by Herman Manson (@marklives) Johanna McDowell, the managing director of the Independent Agency Search and Selection Company (IAS), has a storied career in South African advertising.
She became managing director of Grey-Phillips advertising in 1988 and later launched her own PR agency. in 2006, she founded IAS — a consultancy that assists marketers with agency selection in South Africa — with her partner, Dan Moyane.
We caught up with McDowell (@jomcdowell) to ask her about the secrets to successful pitching, managing client chemistry sessions, how important awards are to winning business and why using pitch consultancies doesn’t mean marketers are abdicating their responsibilities.
Why did you start IAS?
Johanna McDowell: I founded the IAS here as a result of an experience I had with the AAR Group in the UK back in the ’80s. I worked in advertising in the UK during the late ’80s and came across AAR. Their role was to help clients find agencies and to provide feedback to agencies post-pitch. Those were the fundamental reasons behind the business and I knew that, if I returned to SA at any time, it would be a great business to start.
Prior to working in the UK in the ’80s, I had worked for 12 years in SA in advertising and had experienced both client business and new business — in fact, I was the first new business director at Grey Philips in the mid ’80s. When I went to the UK, the agencies there latched onto my new business experience and that was how I got into the ad business in the UK.
Having said all of that, I grew up and was educated in the UK. My tertiary qualification is in marketing and my first two jobs were on the clients’ side. I had no intention of working in an ad agency but when I came to SA at the age of 22 on an adventure, the ad-agency world beckoned.
When I came back to SA in the late ’80s, it was to run Grey Philips as CEO. This was the largest and most creative agency in SA at the time, with more than 200 staff and 150 clients. I was then 36. I did this for a few years and then left as I wanted to have shares in the company and none were going to be made available. So I spent a year on client side once again, at Absa as chief manager: marketing for 12 months, before starting my first business, which was Integrated Communications.
As part of the process of founding the IAS some 18 years after I had first come across the AAR Group, I approached AAR to ask them if I could open their business in SA. They were delighted and indicated that they would not want to take any equity in the company but would be more than happy to train me in their systems — for a fee, of course!
I was trained at the AAR in London over a week and then, every year since, we work together or consult each other on the business. Through the AAR I was introduced to AdForum and the AdForum Summits, which I have attended ever since we started the business here in SA in 2007.
What is your revenue model — who pays for what?
JM: Clients — marketers and advertisers — pay for the projects we do for them such as pitch management, agency reviews, relationship management and general consulting, and training of marketing teams in agency management . These fees are bespoke to each service and product that we offer.
Agencies pay an annual low subscription fee — based on the size of their agency or agency group — and for that they receive a variety of services, including master classes, pitch feedback, pitch simulation, inclusion on our website, [and] access to AdForum.
How many pitches do you help facilitate in an average year?
JM: Between 25 to 30 pitches per year are handled by us. At any one time, we will have about six pitch processes in progress, as the process takes about four months from start to finish, including contract negotiation. In terms of opportunities for agencies, we create more than 200 pitch opportunities per year for them.
Describe the facilitation process as managed by IAS.
JM: Five stages all based on elimination:
- Initial report, where we trawl the market to find a long list of suitable agencies who might fit the brief
- Call for specific credentials – this is sent to a reduced list from the Initial Report — and Talking Heads
- Chemistry sessions with the five or so shortlisted agencies
- Final pitch with a maximum of three agencies
- Contract and negotiation
Some might suggest that marketers are placing too much responsibility in the hands of third parties, thus abdicating their own responsibilities in the agency-selection process.
JM: On the contrary, we believe that marketers who use intermediaries are taking far more responsibility than those who do not.
First of all, they have made a financial commitment to the pitch process — this is a clear indicator to candidate agencies that the marketer is serious about the process. Secondly, the marketer makes the decisions; all we do is provide the information and the guidance to the marketers and their teams — most of whom have never had experience in agency pitches.
Our role is to bring the marketer as much choice as possible and we are always delighted when the marketer comments on how unexpected the level of choice was during a pitch.
When an agency presents its credentials what do you look at first?
JM: The agency submits credentials to us; we like to see their Talking Heads showreel as that really tells us what the agency is about. Then we look for the content of the case studies which are often crucial to the elimination process.
Tell us what you recommend on how agencies manage the chemistry sessions? [Tips for getting better results, what to do, what not to do!]
JM: There are some key points:
- Stick to the time
- Manage the team and its behaviour — make sure the people in the room are the team who will work on the business
- Make sure that agency asks really good insightful questions of the client, which will indicate that agency has done some homework
- Watch the room temperature
- Switch off the mobile phones
- If serving food, make it easy-to-eat food and readily accessible — sounds obvious but you would be surprised how often this is wrong
How important are awards in the selection process? Many agencies are quite convinced that, without a strong awards showing, they won’t be selected for pitch lists?
JM: Awards are overplayed here in South Africa. They are an industry hygiene factor — which is good — but they are not pitch winners. Marketers like to see that their agencies do well but they are not impressed by a string of awards unless a particular advertising-effectiveness award might be relevant to their business.
Marketers want to see results — and those results are marketing-specific, not awards-specific. Results such as increase in brand share, greater consumer awareness, improved sales — those are the results that impress clients and make a marketer want to do business with an agency. Not the number of Facebook likes or a Loerie.
Many agencies are complaining about the involvement of procurement departments in the agency-selection process. Is there reason for concern and how influential are they really in terms of the final decision-making?
JM: Agencies should be very conscious of the role of procurement. No marketer will be able to appoint an agency without procurement’s involvement.
The IAS works very closely with procurement on all pitch processes; in fact, if they are not involved, I would be very concerned. Procurement does not choose the agency in the end; the marketer does. But procurement is a key influencer in the decision-making process in terms of sustainability of the agency – they will point out the weaknesses in agency structures if an agency is too small, for example. Procurement does not just look at price.
Why do you filter out agencies with competing business on their books?
JM: Marketers, in general, will not work with agencies who have competitive brands on their books. Confidentiality of marketing strategy is critical to the success of any corporate.
Some would argue they deserve the opportunity to pitch as they would be willing to resign competitive brands?
JM: We think that this is a very unwise practice for agencies to resign a client in favour of another. Most clients view that kind of strategy with apprehension and distrust. After all, the same could happen to that client if that is the way an agency behaves. Those are not good business ethics.
Are you noticing any trends on client side in terms of the type of agency they want to work with?
JM: Marketers want to know that they are ahead of the game with their agencies. So, at the moment, with marketers asking “ What’s next?”, the digital agencies and the social media/content agencies are the current trends.
We are seeing a lot of M&A activity in the market at the moment — especially from WPP and Publicis Groupe — how are clients viewing it?
JM: With interest, of course, and especially to see how this might enhance agency activity in Africa, which in turn will help them as marketers.
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