GROWTH:

How Did We Go From “Mad Men to Sad Men”?

Creativity in the marketing industry racing a slow death march

Go to any marketing conference or seminar these days and you are likely to hear someone lament declining creative standards and the loss of brand magic.

The agency business has changed a lot since the “Mad Men” days. What used to be a diverse industry of creatively is now lead by junior associates directing accounts with minimal guidance from veteran visionaries. Many of whom are too costly to retain thanks to the constantly shrinking budgets caused by clients forcing agencies into a race to the bottom.

The reality is the financial pressures have put a squeeze on marketers’ abilities to unleash their creative talent. We can’t have first-rate capabilities with second-rate fees.

I don’t blame clients for seeking out low rates. After all, there are only two ways for a business to make more money:

1. Increase revenue
2. Cut costs

But, what’s your brand worth?

Yes, there was probably too much fat around the edges in the old days, but the pendulum has swung too far the other way now: it’s too fragmented and there are increasing pressures to cut costs too much.

Given that creative agencies offer wildly different rates for what clients assume is the same service, it’s no surprise that many buyers of creative services try to cut project costs by going with a low bidder.

Could we have won the bid? Sure, by charging half of what we normally charge, but where would that leave me, the business owner? I’d be paying my team more than we bring in, which is the definition of a failing business.

Clients are willing to spend millions for media buys but they have problems investing more than a dime for the actual creative. It’s not their fault. It’s now all about the price tag and the commoditization of everything.

The race to the bottom always starts out with quick wins

At the starting line, the race began with smart efficiencies. Hard choices are made and they lead to better outcomes. The problem with the race to the bottom, though, is that you might win. You might save a few more shekels for now, but not for long.

The race has harmed the whole creative industry, all stakeholders and, most importantly, the mission of a creative agency. Someone is always willing to become the next agency for one point or full-time employee less. We know that competitors want to drive their costs to zero so that they will be the obvious commodity choice. We know that many that seek to use creative resources want all of it fast, cheap, and now.

The race to the holy grail of cheapness has led to questionable moral and ethical choices when it comes to choosing agencies. Cutting agency compensation down to the brittle bone.

As an agency that participates in a race to the bottom, it’s clear who’s the biggest loser: the agency. When you reduce the headcount to get the contract, you have to cut corners, force people to do the job of two, scrimp on culture, never find time to train, become a mediocre agency. You have to be harsher and more authoritative than you want to be. You become the agency and the employer you never wanted to be.

Congratulations you lose.

The race to the top makes more sense to me. The race to the top is focused on a collaborative economy. Mutual respect between clients and their agencies freely giving each other dignity, stability and yes, generosity when it might be easier to be selfish.

Do you really want “cheap” or do you want “a good value?” Sure, I look at the costs and I do comparison shopping across the internet to make sure I’m getting the best value, but I don’t focus on cheap, and I bet you don’t either when you make a major statement purchase for yourself.

So, why do you think everyone else is different than you, and just want cheap at the expense of great value?

No great brand is known just for being cheap

I would encourage companies who are shopping right now to consider that cheaper is not always better. At the end of the day get what you pay for.

Clients who read this article may start to view our service differently. That’s my hope, anyway.

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How Did We Go From “Mad Men to Sad Men”? was originally published in Marketing And Growth Hacking on Medium, where people are continuing the conversation by highlighting and responding to this story.

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