“…I get so lonely especially when business is bad and there’s nobody to talk to. I get the feeling that I’ll never sell anything again, that I won’t make a living for you, or a business…”
…Willy, Death of a salesman, Arthur Miller 1949
In the summer of 2004, I had the privilege of attending a global agency network conference, which held in Barcelona that year. In attendance were the managing Directors, agency heads and creative directors of the network agencies from across the world.
It was a gathering of some of the smartest people in the business of building brands, but there was only one problem. They all came from the agency side. In what had become an annual conclave to discuss the state of marketing communications across the globe in general and within one of the most successful global flagship agency networks more specifically, I looked on with astonishment as grown men in thousand dollar suits griped and complained bitterly about business.
It was just after the dot com bubble burst after all and millions of dollars in market cap had just recently been wiped away from stock markets across the major financial centres of the world not to mention the consequential brutal slash that had been made to marketing spends across both Europe and the America’s.
It all seemed strange to me at the time. I was rather young. One of only two agency heads attending from Africa and the Middle East, and more so from a country where we spent cash, still struggled with phones let alone having a decent internet connection, not to mention internet startups.
Our biggest accounts then were still the traditional FMCG companies, even as the newly formed telcos had started to find their feet with the market. I was at best a very distant fringe player in the agency network coffee club I had been invited to attend, and the issues being discussed seemed remote.
Yet one of my most profound moments occurred at that conference. I recall that it happened during a conversation with a man who had founded a small direct marketing agency in Soho London and then sold it to the agency holding company some years earlier after having grown it very rapidly into a successful global network operating in over 20 countries. I asked him how he had achieved such a remarkable feat.
Indeed the heart of the question as I was keen to learn from him was how you keep a marketing agency alive and well through both good and bad times. The gentleman hadn’t been educated in some fancy school, nor was he one of the savvy MBA types (like I was) who were now being recruited into marcoms in Europe and the US at the time.
He was a hardnosed direct marketing crafts man who had come up the hard way and built an agency business brick by brick. He humoured me on that evening over generous drinks and he told me quite candidly, “I always endeavoured to have at least four clients and always made sure the fourth client was Interest income!”
I have always remembered that conversation over the years, beguiled by the sheer cheek of it, the brutal truth of it and perhaps the irony of it as well. Today, now more than ever before that admonition seems well suited for those who have chosen to make their living as proverbial ‘mad men’; the agency guys who seat at the bottom of the marketing food chain hoping to serve brand owners in what has become a severely depressed and volatile marketing communications market, that seems to have so rapidly and radically changed before our very eyes. Anyone in the professional services has always known that if the client sneezes then the service agency is bound to catch cold.
What many did not realize perhaps is that an entire creative industry would be doomed to life support on account of a full blown life threatening economic pneumonia. So we find ourselves in similar dire straits as our colleagues in Europe and the US have thrice been in the last fifteen or so odd years, ravaged by the financial crises of the dotcom bubble burst, the collapse of the sub-prime housing market and the credit crunch.
Yet in my view, ours seems to be an industry unprepared, and reluctant to adapt to the realities as the marcoms industry was forced to in those markets. Indeed we are now faced with he brutal realities of recession on this industry: depleting budgets, thinning briefs, unprofitable trade terms, negative cash flows, debt, anxious talents, recalcitrant banking partners and even more fragmentation and commoditization of what should be a high operant resource based industry.
If industry attractiveness as currently structured should dare not be questionable, the market logic certainly must. The service dominant logic seems to be collapsing, and with it the erosion of a healthy service ecosystem of mutually respecting partners. It is a peculiar time requiring different approaches and while survival is what the new song sheet several players seem to be singing from is about, many of us on the agency side have sadly not been as far sighted nor empowered enough as my old friend to have built interest income into a sizeable fourth client.
It leaves the agency in dire straits at a momentous time. As the dynamic of the client agency contracting relationships retreat from the creation of value in context to the more basic one of exchange, am reminded of the dilemma faced by the protagonist in ‘Death of a salesman’, the seminal theatrical piece by the late American playwright, Arthur Miller. As he sees his world collapse around him he finds the courage to question.
As we also now on the agency side, must ask the brutal question of what now happens to equity?
To be continued..) Dr Rotimi Olaniyan (FNIMN), Olaniyan is Principal Partner at Advantage Marketing Consulting, a faculty Member of the school of media and communications at Pan Atlantic University and currently President of the Experiential Marketers Association Of