by Mike Silver (@stretchmike) The title of this article may be misleading. Officially, we’re not in a recession… yet. But, if you follow the news, you’d be forgiven for thinking it’s time to start using the “R” word.
With all this talk of downgrades, SARS Wars, a weakening rand and slow growth, it’s no surprise that marketing budgets are being slashed. However, in the interest of diplomacy, I’m going to avoid the debate on why it’s logical to do away with the one function that’s sole purpose is to facilitate growth. Instead, let’s explore how agencies and brands may still deliver meaningful brand experiences, even with an uncomfortably tight waistband.
Fighting on the same team
A crazy amount of agency spend is still wasted because of politics and territorialism. In tough economic times, it’s critical that clients tap into the magic of collaboration. Key to this is the client ensuring that an expectation of collaboration is communicated up front and that this is recognised and celebrated when it works.
Experiential is often one of those ‘fringe’ channels and, as such, lead agencies often take it upon themselves to attempt doing the thinking on their behalf. So the client is effectively double-charged for a less impactful service. It’s critical that specialists are left to specialise, collaborating only when the whole is greater than the sum of the parts.
The ‘value’ of likes, trophies and trending
Despite what many agencies think, the words ‘advertising’ and ‘awards’ are indeed mutually exclusive. In a harsh economic climate, where consumer confidence is in the gutter, the reality is that campaigns that don’t deliver are worth less than the faux gold coating found on the trophies. Ultimately, while we work in a creative industry, this industry only exists because of commerce. If we aren’t selling, attracting or convincing, we might as well start a new indie film festival.
Unfortunately, many agencies still only sell the snake oil of ‘equity building’ when strategic business solutions are required. When eBay, a retailer famed for, well, retailing, decided to go experiential, it was no surprise that it had a sales experience at the core. Its social media mobile popup in London tapped into a rich insight of the indecisiveness around Christmas shopping and provided a social media-driven sales solution to solve it, thereby justifying equity driving spend.
Rethinking agency remuneration
Lastly (and controversially), how about we as agencies start putting our money where our mouths are? If we are so certain our concepts are the business (and, more importantly, deliver upon our client’s objectives), how about we put a wager on it? From a client’s perspective, this ensures their agency remains commercially focused in these tough times, with a ‘carrot’ provided to ensure focus.
The performance-based model for agency fees normally looks at discounted rates, provided in exchange for a profit/sales share incentive. US digital agency, Razorfish, took this one step further in 2014 with a 100% remuneration model based entirely on the client’s (Peet’s Coffee & Tea) online sales.
While no one enjoys discomfort, it often occurs when an attempt is made to squeeze a square peg into a (now) round hole. With the rules changing in line with ‘cost-consciousness’, agencies would do well to keep their eye on the ROI prize and avoid tripping over our egos (and trophies) in the process.
Mike Silver (@stretchmike) is director of Stretch Experiential Marketing (www.stretchexp.com). He established Stretch — a specialist experiential marketing agency developing strategies and concepts for national execution — after working in sponsorship consultancy and experiential marketing in the UK.
“Motive” is a by-invitation-only column on MarkLives.com. Contributors are picked by the editors but generally don’t form part of our regular columnist lineup, unless the topic is off-column.
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