Reminiscing & Advice by Drew McLellan at AMI

When I was in high school, I took one of those aptitude tests to see what I should be when I grew up. It was really just an exercise of curiosity because I already knew I was going to be a psychologist (I’ll tell you how that went sideways over a drink sometime). When I got the test results back I was stunned to see that military officer was one of the top suggestions. If you know me at all, you know that would have been an unmitigated disaster. All I could envision was me apologizing to my troops for making them get up early!

As I think about the mini-plan I want you to focus on this week — your team plan — it reminds me of a bootcamp scenario. Our people are out of their natural work element, we’re asking them to work at odd hours with lots of obstacles, and they’re under a ton of pressure. They’re worried about how their performance will influence the ultimate outcome and what impact that will have on their lives. But, unlike a military bootcamp, our role needs to be a little different than a drill sergeant. We aren’t going to mold our team into soldiers and then send them on their way. This is OUR team — so we can absolutely hold them accountable but do so by creating a healthy, candid environment.

If you remember, the five mini-plans I want you to develop are:

• Operational/financial plan (How will you get the work done on time and on budget? Then, determine the minimum acceptable profit margin for your agency and use agency math to manage your way to never dipping below it.)
• Team plan (How will you keep them motivated, efficient, profitable, and striving to serve each other and your clients?)
• Client plan (You need to proactively guide each client into a position of readiness so that when they can step back in — they’re ready and more prepared than their competitors.)
• Prospect plan (What can you talk about that will be valuable? Base this on what your prospects are ready to hear at any given moment in time.)
• Vision of the future plan (What parts of normal are worth rushing back to and what could/should be different?)

I believe that in a crisis people reveal their true selves to you. By now, you’ve been surprised and impressed by some of your team members and maybe a little disappointed by others. I know you’ll give everyone the benefit of the doubt. But, even beyond that, you’ve been given some important insights into your team. As we slowly work our way out of crisis mode, do not lose track of those insights.

Now is not the time to ease up on holding everyone accountable. When every penny counts, we have to make sure we’re as efficient and effective as possible. A couple weeks ago my podcast guest, Adam Carroll, had some easy to follow tips for holding your team accountable with his HEAT framework.

Here are some of the ways the agencies that are really performing well are managing their team:

• Daily Zoom huddles (Traffic meetings.)
• Honoring their one-on-one meeting schedule.
• Leave-no-man behind Zoom calls. (Personal check-ins to make sure each of your team members is doing okay personally.)
• Weekly agency update with lots of transparency around money, job security, client activity, biz dev, etc.
• Playtime (Virtual happy hours, word games, getting to know you questions, photo contests, Zoom background competitions, etc.)
• Group and individual goal setting and sharing (We all do better with something to work toward.)
• Investing in new learning and skills development (If your team is not fully deployed — this is a smart way to prep for our re-entry.)
• Peer and supervisor recognition. This is such good medicine as we socially distance. If you don’t already have a peer recognition program in place, this might be the time to start one.
• Review of company values. Re-teach everyone how they look in action.
• Serve others together. Whether that’s a community project, everyone coming together to help a client through a sticky situation, or supporting a team member who is having a tough time, about to have a baby, etc.

COVID-19 is calling on us to be the best version of a leader we can be. You absolutely need to be kind and understanding but at an equal level, you also need to hold each employee to a very high standard. Think of yourself as a benevolent drill sergeant and do all you can to not only get good work from your team today but even more importantly — prepare and assess them for the future version of your agency.

Are they the people you want to go into battle with? If so, do everything you can to guarantee their success.

Silly question you might say, but what’s your website for anyway?

Before You Had Your Website:

Before you had a website, you should have had an agency brochure. Something you kept in inventory for those times when a prospect conversation ended with “can you send me something?” Off went the brochure with an accompanying cover letter. That conversation and package was normally sent by the person charged with agency business development and followed a meaningful telephone conversation. The cover letter was written accordingly.

A good “agency business development person” (ABD) would make a follow-up call to confirm package receipt and continue with a probative conversation. Using what was learned during that call, the ABD now sent a very carefully considered and grouped collection of materials designed to emphasize and confirm the agency’s suitability and candidacy for handling the client’s business.

This process was carefully tailored to each client and each client’s interest; when speaking with a B2B client, there was generally no “show and tell” of fashion-related experience. Conversely fashion prospects were not burdened with industrial examples. Thinking back, didn’t this all make sense?

What’s Your Website Today?

What’s your website today? A pithy mini tome declaring purpose and intent; a collection of everything you do and have done; an introduction to smiling team leaders with photos and bios, text hopefully appealing to all visitors, samples of current work in all categories, a listing of current but seldom past clients, concluding with a “Contact Us” page. Not necessarily in that order, but available for viewing.

Many variables determine why an agency is selected by a client, but all will agree that “chemistry” or likeability plays a deciding factor in the final selection. Knowing that, good agency people also know that “chemistry” plays a factor from the very beginning. Meaning – “You never get a second change to make a first impression” and undeniably the ABD can make or break your chance for success from the get-go.

If that’s the case, why not give your ABD star billing on the Contact Us Page? A handsome photo, and brief but credentialed bio, and multiple contact options. And while you’re at it, if your ABD is engaged in multiple forms of proactive outreach, rather than pointing to your website in those materials as your competitors do, suggest they engage in an initial telephone conversation; then respond with a “custom digital agency brochure” tailored to that discussion.

How About A New Website?

As to your website? How about other alternate versions – just a powerful page or two featuring a vertical market, then declaring your understanding of the importance of relationships and of one-to-one conversation. Agency-to-client and client-to customer.  Let them know your initial conversation will lead to a uniquely-selected collection of samples and examples specific to their interest and needs. Not like other “we-do-it-all” agency websites.  Incorporate AI to let them schedule a day and time for their call and conversation. Confirm by email plus a real honest-to-goodness agency business card via USPS.

Oh BTW – agency websites are used to recruit new hires too. But rather than burdening someone on staff who often has limited HR experience, why not engage an employee search consultant to narrow the field and present only qualified candidates? (as they’ve done for years)

Traditional media has met its match with the advent of digital, and the advertisers have been weighing out the pros and cons for each medium to make spending decisions ever since. Media players however, are now saying the debate should stop because at the end of the day, content is king.

Havas Group Singapore’s chief executive officer, Jacqui Lim said that contrary to popular beliefs, the first steps for her team after receiving a brief and budget from the client is not to build a media plan and decide which channels. Instead, a lot of planning goes into optimising metrics and understanding what hits the right key performance indicators. This is driven by clients’ expectation for the agency to look at things in an integrated, platform-agnostic and audience-centric fashion.

Your Guide Chuck Meyst, Chairman

To decide on the right medium, there are several dimensions to consider, Lim said. For example,

Clients believe in a much more trackable and attributable kind of platforms, but the traditional or broadcast media comes in to help us amplify.

Rather that choosing traditional “or” digital, general manager of Unilever Singapore Banjo Castillo advises that advertisers shift their mindsets to “and”, and move the conversation towards how they can make the best use of finite resources.

With consumer journeys crossing not just media platforms but different screens as well, Castillo said that the company is focused on building its data-driven capabilities to boost campaign efficiency. This includes precision and performance marketing.

Havas’ Lim suggested a more unified currency for traditional and digital media buys, where television goes programmatic, and measurement and targeting are as transparent as that of digital. She added that making interaction and engagement metrics possible will also assure clients that they are making meaningful connections with their customers.

Understanding consumers

Additionally, the panellists at the event hosted by Mediacorp urged marketers to focus on effective storytelling as content is what matters to people and catches their attention. Ajay Vidyasagar, regional director, YouTube partnerships, who had previously also spent almost two decades in the television industry, said that digital has not only changed the way viewers consume, but allowed people to create content as well. This was what led to a surge of users on YouTube. He added,

“The walls between digital and traditional media are truly breaking. Consumers want content when they want it, in a form that they are able to consume, on a device they are comfortable reaching out to at that moment.”

Meanwhile, Castillo said that marketers can leverage digital to craft messages and develop products tailored to customers’ wants and needs. Digital has for instance, changed the way Unilever gets to know its customers.

He added, “When we do consumer research, it takes three to six months to come in, before we even get to analyse it. Now, through the power of digital, we can actually do social listening, and learn about consumers on the fly.”

by Avelyn Ng Courtesy the MARKETER

by Lindsay Stein, Campaign Magazine

But the agency president and copywriter does believe in work-life balance.

Connelly Partners’ President and Copywriter Steve Connelly believes that working from home kills agency culture. However, he also tells employees, “If you don’t have a life outside of the office, you are useless to me.”

These are two of Connelly’s “strands of DNA,” which he tells Campaign US is a “blend of pragmatism and some basic human tribal beliefs I have that help us yield good work.”

He explained that no one can be creative 24 or 12 hours a day and he doesn’t expect staffers to work very long hours, but he does want them to be focused when they’re in the office.

“I have kids in their 20s and I certainly hear a lot about liberal work from home policies and I think that’s fine if you’re into productivity and staying connected, but if your focus and priority is culture, which mine is, then you have to be in the office, you have to talk to people and feel the energy around you,” he said.

But this doesn’t mean the agency doesn’t believe in work-life balance. Connelly said that if a staffer needs to work from home because he or she needs a mental health day or has a sick child, he’s totally fine with that. Plus, the shop offers unlimited vacation days.

“What you need to do to take time to refresh and stay charged and bring new experiences into the office you should do, but I’m not saying that I’ll pay for three days and then have you work from home on the fourth and fifth day. That’s not culturally beneficial,” he said.

Mothers who want or need to work from home are on a case-by-case basis. Connelly said he wants to make sure he stays connected with working moms and gets them back in the workplace, but he says if you’re in a leadership position, “You can’t lead by phone – you need to lead by example.”

He said he’d rather have a working mother tap into a truncated schedule in which she comes in earlier and leaves earlier than have her work from home.

Connelly also strongly believes in having a life outside of the office. “The more successful you become in this business, the more you’re taken away from what made you successful – the everyday things and people,” he said.

He added:” If you’re job is to tell so a wide range of people, you better be able to observe a wide range of lives. Go learn, live and find, and sometimes you suck up experiences without even knowing it.”

The agency’s culture is “familial” and “imperfect like most families, but with a lot of honest inside,” according to Connelly. The shop was built around a living room, kitchen table and bar because those rooms are often where the best conversations take place. “It’s a very educated treehouse,” said Connelly.

For agencies looking to figure out or build their own cultures, Connelly has some advice: “Please understand that culture is organic  If you’re going to commit to culture, understand that you are the dirt, not the seed or plant, and your job is to provide the best growing environment.”

Note: Steve Connelly and his agency are proudly “one of ours!”

Creating value is the foundation of your firm’s success, and it rests on a clear definition and understanding of the specific client challenges your firm is best prepared to address. Most firms approach this question precisely backwards, showcasing the obligatory bullet point list of services as the standard bearer of their business strategy. But the capabilities you offer must emanate from the types of business problems you solve for your clients. Clayton Christensen frames this in context of Jobs to Be Done Theory; the idea that clients hire a specific service to solve a specific problem.

The essence of this leg of the model is to clearly define and articulate “What are the problems we solve for our clients?” The most powerful way to do this is to state these problems from the client’s point of view, in first-person language.

Equally important is a clear articulation of the markets you serve. The answer can’t be “everyone with money,” as some firms regrettably define their target market. Peter Drucker famously observed that marketing starts with the question “Who is your customer?” and this question applies just as much to professional firms as to the clients they serve. Your target market doesn’t have to be a type of industry category; it can be a type of audience or even a type of brand.

Delivering value is the second piece of your business model. This means developing and supporting an effective engagement model, which is comprised of your operating model and your production system. Most agencies get high marks from client organizations when it comes to responsiveness; meeting deadlines, reply client requests, and fulfilling scopes of work. In other words, we’re seen as very responsive. (Unfortunately, client ratings for agencies being proactive are dismally low.)

When it comes to the operating model, the central issue agencies must address is differentiating between short-, mid-, and long-tail offerings. These solution sets vary widely in perceived value to clients, and must be delivered in very different ways by agencies. Short-tail offerings are the agency’s unique blockbuster competencies; uncommon services and programs that provide high-value solutions to client problems. Mid-tail offerings are capabilities that are routinely applied in most engagements. And long-tail offerings are the widely available executional services and activities that are seen as standardized (and therefore commoditized) by most clients. These three classes of offerings must be developed, delivered and priced in very divergent ways. The mistake most firms make is bundling all three service classes under the banner of the dreaded “blended rate,” the absolute worst way to address the continually-evolving disintermediation of agency services.

Capturing value is the part of the business model where professional firms struggle the most. The root of the problem is trying to package up the value of knowledge work in a unit of time; a hugely suboptimal way to get paid for the expertise and intellectual capital that resides in your firm.

Effectively capturing value is dependent on having an actual revenue model (billing for your costs is not a revenue model, it’s just a reflection of your cost structure). Professional firms with actual revenue models have replaced their rate card with a “pricing stack, a variety of ways to capture value in ways that align with the principles and practices of modern pricing. These include such approaches as dynamic pricing, two-part pricing, royalties, licensing IP and more. At the very least, it means pricing based on the perceived value of the outputs or outcomes, not the cost of the inputs.

To fully capture the value you create also requires commercial alignment; uniting the entire organization behind a shared vision of what you really sell and how you should get paid for it.

Not planning, but choosing

Especially if your firm has been in business a decade or more, it’s very likely that you’ve arrived at your current business model more by default than by design. You are living with an emergent strategy rather than a deliberate strategy. If this describes the current state of affairs at your firm, you have the opportunity (if not the obligation) to deliberately design your business model.

Your remix is not necessarily to make plans, but to make choices. Business planning is about taking steps and deciding what to include. Business strategy is about making choices and deciding what to leave out. As you examine each element of your business model, the job is to not to figure out how you can be better, but how you can be different. As design thinker John Koklo recently observed, “Leading companies say No much more than they say Yes. Rather than chase the market with follow-on features, they lead the market with constrained focus.

Propulsion is written by Tim Williams of Ignition Consulting Group, a global consultancy devoted to helping agencies and other professional firms create and capture more value. 

Remember those goals you created in your retreat, summit, on a long car drive, in the shower, etc. for 2018?

That seems like eons ago, doesn’t it? You had plenty of time. You just needed to get a few things off your plate before you really dug in and got started.

Well, guess what — we have about 90 days left. In the US, Thanksgiving is three months from today. And whether you celebrate US Thanksgiving or not, we all know that by December 1st, things begin to grind down to a crawl for that last month of the year (and the first two weeks of January). So if we’re going to make hay, we need to do it right now.

One of the most paralyzing things we do to ourselves is to bite off more than we can chew. Our grandiose plans are so overwhelming that we don’t even know where to start. It’s time to trim that plan down to the essentials.

I want you to identify the two things you can do that would have the most impact on your agency by the end of 2018. It might be getting rid of a toxic employee. It might be doubling down on mentoring an AE so they can take more day-to-day work off your plate. It could be a new business push or fixing an internal system or process that is broken.

Whatever they are — no more than two. And then this week (yes, before the end of the day Friday) put together a simple plan for making it happen. Calendar it. Commit to it. Build an internal team if you need to. But, the finish line is now visible to the naked eye, so we can’t put these things off any longer.

You’ve got 90 days to set yourself up for success in 2019. Don’t dilly or dally. Just get it done!

Thank you Drew!

Guest Author, Tim Williams

You’ve just found $100 on the sidewalk. Should you put it under your mattress or buy a lottery ticket? What role does your tolerance for risk play in your decision?

In business circles, risk is almost always treated as something to be minimized. But can risk also be an economic positive?

The iconic Peter Drucker made a profound observation when he said “All profit is derived from risk.” Ponder that truism as you consider the nature of the compensation agreements you developed over the last 12 months. It’s likely you injected little to no risk in your proposals, which is in directly violation to the principle that if you want to make more money, you must take more risk.

Harvard’s Benson Shapiro offers this perspective: “Performance-based pricing is insurance. It insures that the seller does not undercharge the buyer.” In other words, introducing an element of risk in your compensation agreements not only holds the potential of making more more, but also making you a better pricer.

Who Bears the Most Risk in Agency-Client Relationships?

Now let’s look at risk from another perspective. Jack Skeels of AgencyAgile believes “The primary mediating characteristic of buyer-seller relationships is how risk is handled.” Says Skeels:

“When we ask agencies, ‘Who carries more risk in the relationship, you or your client?’ the answer is almost always ‘We do.’ Nothing could be further from the truth. Your client carries more risk than you do … by a million miles … Clients are completely vulnerable to your efforts (which they don’t see, understand or control), and when you fail, they can die.”

The method of agency compensation is an important factor here. Clients who buy hours are really only buying buckets of inputs that may or may not correspond directly with the needed outputs. But more importantly, these inputs may or may not produce the desired outcomes. Herein lies the risk being taken on by the client. The agency will work its hours and collect its fees regardless of whether or not the work is effective. While every good agency desires to do good work, there is no real economic incentive for them to do effective work.

True, the agency can get fired at the end of the contract period, but that misses the point. After nearly 30 years using the hourly rate system, smart clients have realized that this approach has a fatal flaw. Brand growth has been stagnant for more than a decade, and most major marketers have been slogging along in a low-growth mode, unable to generate the needed ROI on their marketing investment. These clients have now concluded that the hourly rate system does absolutely nothing to help this situation; they’re simply “renting people” in advertising agencies.

Accompanying this current low-growth cycle for brands is an understandable low-cost mentality. Hence the rise and power of procurement. The prime directive at corporations everywhere seems centered on efficiency and cost cutting.

But what are these client organizations truly buying? No company ever saved its way to success. My friend Tom Lewis, formerly of the IPA, observes that professional buyers of marketing services are now squarely in the habit of attacking the seller’s cost base, insisting on as low a profit margin as possible while purposely leaving workload ill-defined. This, Lewis says, results in a low seller’s profit and a low cost of purchase for the buyer. In return for a lower price, the buyer unknowingly accepts compromised quality and effectiveness.

So instead of complying with buyer requests to lower costs— which will not provide the client with what the results they’re attempting to procure — could agencies instead lower their client’s risk?

Three Things Clients Buy

One of the world’s foremost business strategists, Michael Porter, asserts there are three main reasons businesses buy the services of companies like agencies:

To increase their revenues
To lower their costs
To decrease their risk

While most agencies don’t know it, even the most hard-core procurement professional thinks in these terms. Former WPP head of procurement Tom Kinnaird emphasizes that cost is just one of four areas in which procurement professionals seek a “win.” They also seek to obtain value, maximize cash, and minimize risk. This risk can take the form of:

The risk of suboptimal performance by the seller
The risk of not receiving the promised features and benefits
The risk of the service provider not producing the agreed-upon results

Writing in the WPP publication Atticus, Scott Brenman proposes the idea of a “threat audit” to help identify risks your clients face. He then recommends including on briefs a section about risks and threats to keep both agency and client focused on ways to minimize them.

KBS+ co-founder Jon Bond believes that agencies aren’t really in the ideas business — or even the results business — but rather the insurance business. The best agencies, he says, embrace the idea that their essential purpose is to reduce risk for their clients. Bond proposes that agencies should proactively sell their services this way, which he believes leads not only to more new business wins (risk reduction is a powerful proposition) but also better pricing (the best insurance companies command the highest premiums).

In the end, Bond says, “Economics are more powerful than negotiation.”

Propulsion is written by Tim Williams of Ignition Consulting Group, a U.S.-based consultancy devoted to helping agencies and other professional firms create and capture more value.