ANALYSIS: Advertising - Should agencies take their own medicine? Few ad agencies put their sermon into practice by running house campaigns

<p>To advertise or not to advertise when sales head for the ditch? </p><p><BR><BR> </p><p>It all depends on who is doing the talking. If it's an advertising </p><p>agency speaking, nine times out of ten, the likely message would be: </p><p>stay on course with the advertising. </p><p><BR><BR> </p><p>Sounds like a self-serving spiel from agencies? Hardly. There's plenty </p><p>of documented evidence showing that the biggest names in business - </p><p>Coca-Cola, IBM and Intel - got to where they are partly by keeping the </p><p>marketing taps on even when economies headed south. </p><p><BR><BR> </p><p>What if the shoe was on the other foot? Shouldn't the preacher also put </p><p>his gospel into practice? Shouldn't agencies run ads in regional </p><p>business titles or television spots to reach potential clients? In a </p><p>word: no, say agencies. </p><p><BR><BR> </p><p>Indeed, house advertising campaigns by agencies are few and far between </p><p>in Asia, whether the economy is in rude health or slumping. Not that </p><p>this is any different elsewhere in the world - save for maybe South </p><p>Africa, where a business title pulls in regular campaigns from the </p><p>agency fraternity. </p><p><BR><BR> </p><p>Among the small minority that have tooted their horns with advertising </p><p>are Saatchi & Saatchi, M&C Saatchi Hong Kong, and, to a lesser degree, </p><p>D'Arcy, though the latter did so to court a particular client. Under </p><p>Saatchi's former regional chief Pete Watkins, it ran ads asking: "Can an </p><p>agency change the world?" Watkins had a clear mission for doing so. </p><p>Saatchi was then a new face in a region where its international rivals </p><p>had been operating for about 20 years. </p><p><BR><BR> </p><p>Seven years on, Saatchi is again trumpeting its offer with full-colour </p><p>pages in a regional business title. Instead of an image campaign, </p><p>Saatchi is talking up its capabilities in China, positioning itself as </p><p>one that understands Chinese consumers on the strength of a 20-city </p><p>research it regularly conducts. Pitcher says the agency chose to </p><p>highlight China because it presents the biggest marketing opportunity </p><p>and Saatchi is the mainland's top-billing agency. </p><p><BR><BR> </p><p>Far more surprising is the route M&C has taken for a three-phase </p><p>campaign to underline its development. It headed outdoors, a strategy </p><p>helped by having a client which runs one of Hong Kong's biggest outdoor </p><p>networks. </p><p><BR><BR> </p><p>But rivals have questioned the effectiveness of doing so. However, M&C's </p><p>chief executive Ian Thubron says the campaigns ran in financial, </p><p>commercial and premier residential sites to reach the business </p><p>community. "We're advertising where they work and where they live," he </p><p>says, adding that the campaigns was created to dispel perceptions of M&C </p><p>as a "gweilo boutique", showing it as a full-fledged agency. </p><p><BR><BR> </p><p>For the first phase, the creative showed the M&C name among the many </p><p>property and services-style advertising stuck on city blocks and store </p><p>fronts around older, urban neighbourhoods. Says general manager Janice </p><p>Chan: "We wanted to show that M&C has become part of the fabric of the </p><p>local community and that we understand local consumers." This was </p><p>followed by the mid-year Inspiration campaign, with agency staff talking </p><p>about the lengths they will go to for clients, culminating in a series </p><p>of executions positioning M&C as a challenger agency. In one, a man </p><p>pokes his tongue out with the tagline: "Does your agency speak to your </p><p>consumer or insult them?" Critical of most house efforts, which Thubron </p><p>feels are done to win awards, he says there was a clear strategy and </p><p>message behind M&C's efforts. </p><p><BR><BR> </p><p>That may be the case, but rival agencies still believe they have </p><p>compelling reasons for not putting their sermon into practice. Top of </p><p>the list is the high wastage factor advertising incurs. Agencies </p><p>essentially fish for business in a very small pond. Ogilvy & Mather's </p><p>regional chairman Miles Young says advertising to reach regional clients </p><p>is "unbelievably wasteful" since client conflict issues limit the target </p><p>audience agencies could approach for new business. </p><p><BR><BR> </p><p>O&M's founder, the late David Ogilvy, was a firm believer in house </p><p>campaigns. </p><p><BR><BR> </p><p>In his book on advertising, he wrote of being puzzled why so few </p><p>agencies took their own medicine. Perhaps it was because the partners </p><p>could not agree on what to say, he surmised. Worse yet, he wrote of copy </p><p>writers and art directors doing house campaigns to impress their </p><p>peers. </p><p><BR><BR> </p><p>During his time with the agency, Ogilvy wrote a series of classic ads to </p><p>tell potential clients about the agency's wide-ranging expertise. </p><p>Pointing out that these were run in the early years, Young, however </p><p>doubts advertising will offer O&M as much value today because of the </p><p>awareness it now enjoys. </p><p><BR><BR> </p><p>Even those without this level of awareness see criticism, stemming from </p><p>agencies' reluctance to advertise as a sign that they don't believe in </p><p>advertising, as misguided. Grey Asia-Pacific president Eric Rosenkranz </p><p>said he tried and was disappointed with the results of a campaign he ran </p><p>a decade ago in Japan. The phone didn't ring after Grey ran a print </p><p>campaign, positioning it as the agency which brought big Western brand </p><p>names into Japan. </p><p><BR><BR> </p><p>Neither has the phone been ringing off the hook for Saatchi or M&C. Says </p><p>Pitcher: "We haven't had a big multinational company call and hand us a </p><p>piece of business. That was not really the intention. The intention was </p><p>to provide an understanding of Saatchi." </p><p><BR><BR> </p><p>But Rosenkranz argues that agencies are being very intelligent when they </p><p>don't advertise. "We're practicising what we preach. One of the critical </p><p>things is to understand who your target audience is, the choose your </p><p>media vehicle to effectively go after that target." </p><p><BR><BR> </p><p>Leo Burnett regional managing director Richard Pinder say agencies </p><p>cannot be compared with their clients simply because they are </p><p>communicating to other businesses and not to consumers. Which means a </p><p>more appropriate bait than advertising is needed to reach the target </p><p>audience, a group that goes beyond prospective client companies. The </p><p>very nature of agency operations these days means agencies need to </p><p>position themselves within the industry for recruitment purposes, to </p><p>existing clients as well as financial analysts. </p><p><BR><BR> </p><p>"It's a very focused business-to-business communication and while there </p><p>is a role to consider for advertising, it's far more cost efficient and </p><p>targeted to do so with direct marketing," Pinder says. </p><p><BR><BR> </p><p>The larger international agencies say they spend significant sums on </p><p>initiatives that go directly to the target audience, from direct mail </p><p>shots and credential brochures. On top of this, PR activities, speaking </p><p>engagements at international business events and client seminars rate </p><p>higher when it comes to positioning agencies to the local business </p><p>community. </p><p><BR><BR> </p><p>It's a route that appears to strike a chord with client companies. A </p><p>handful of clients media spoke to say house efforts are unlikely to sway </p><p>them. Nike Hong Kong's marketing director Rosanna Hon, who has an agency </p><p>background, says: "Ads won't make me want to include an agency on the </p><p>pitch list." </p><p><BR><BR> </p><p>If anything, house campaigns potentially carry a greater risk - clients </p><p>say they'll be quicker to write off agencies if their campaigns are only </p><p>slightly less brilliant. In assembling a pitch list, Hon says the first </p><p>thing she normally does is check out an agency's latest work and talk to </p><p>people she knows within the industry for a general perception of the </p><p>agencies. "What people say about an agency can tell you a lot about </p><p>internal morale and that in itself is a factor that affects an agency's </p><p>output." </p><p><BR><BR> </p><p>As for creative awards, agencies see them as a morale boost for staff, </p><p>but clients say they provide a barometer of an agency's creative </p><p>abilities. </p><p><BR><BR> </p><p>"I would rather agencies let their work speak for them rather than </p><p>agencies talking up themselves through advertising," says Coca-Cola </p><p>China's non-carbonated beverage brand director Joanna Mobley. It also </p><p>boils down to budgets which put advertising a distant second to direct </p><p>marketing in an agency's communications arsenal. There's also the issue </p><p>of timing. </p><p><BR><BR> </p><p>Pinder notes: "Advertising's expensive and for agencies to do so in the </p><p>current climate it's like the MD buying a new car while he's laying off </p><p>staff." </p><p><BR><BR> </p>