Learn to live with search consultants
Heres their advice for ad agencies.
By John Emmerling
February 12, 2001
Aaah, to be an accountant, lawyer or management consultant. These folks get their clients through referrals. Nice and cozya couple of genteel meetings in oak paneled rooms and the new client is welcomed into the fold.
Advertising, however, is a different animal. More and more advertisers are turning to agency search consultants to help find their next shop; and for agencies, these gatekeepers have changed many of the new business rules.
As current chairman of the American Association of Advertising Agencies agency management committee, I recently hosted a working lunch at the Four As Manhattan offices with a number of search consultants, then followed up by interviewing several more. These happy warriors included Catherine Bension, Al Geduldig, Bob Lundin, Chuck Meyst, Skip Pile, Dick Roth, Linda Urben-Peterson, and Leslie Winthrop. (If you don't know which firms these people represent, see point two, below.)
Why search consultants exist:
The $112 million fortune made by CEO Bob Jacoby when Ted Bates Worldwide was sold to Saatchi & Saatchi in 1986 was a kick in the head for advertisers. Who was really paying the tab for those three-martini lunches? How could advertisers assure that compensation was fair, but not excessive? Search consultants, who often came out of the agency business, were there to guide advertisers on compensation matters.
However, as downsizing began to clobber corporate staffs in the late 80s, marketing chiefs with shrunken departments also retained these consultants to set up organized competitions between appropriate agencies.
(It wasnt easy to get straight answers on agency billings and experience, the consultants told us: "You lied too often.")
Today, consultants also educate clients on the changing agency landscape that includes specialized interactive firms, Web-design companies, and new-media technologies.
Getting on the radar screen:
An ad agency has to be sold like a brand. The consultants we spoke to recommended: "Decide who you want to be, and then be that agency." Identify the search consultants in your area (the Four As maintains a current national list) and begin to communicate.
The advice from consultants was unanimous: "Send us some basic information on your shop; and if you include your TV reel, we promise we'll look at it." They suggested that agencies call and ask for a get-to-know-you meeting.
How about those quirky dimensional mailings (the talking clown in a box)? Most consultants called them a waste of time and money: one quick glance and the clown is in the trash. The best advice was to "...constantly stay in touch." Send all press releases. Send a one-page data sheet with updated information at least once a quarter. But limit the e-mails to really important bulletins.
What determines the initial list of shops?
At the first meeting between advertiser and search consultant, the search criteria are set. This includes agency size, capabilities, account experience and possible areas of conflict. "Oh, and I've got a little list here," says the advertiser, pulling out a sheet of paper with some shop names scribbled on it. All search consultants agreed that client suggestions would be included only if those agencies met the search criteria.
And when it comes to matching accounts and agencies, how big is too big? One consultant wanted to keep the prospect from overpowering the agency: the new account's revenue should be no more than one-third of the agency's total revenue. Another said the new account shouldnt be the shops smallest or largest account; ideally it would fall into the top third of accounts ranked by billings size.
The client might typically visit the offices of six to eight agencies, then select three or four finalists to be given a specific strategic assignment based on the first deliverable. For a small review, the losing agencies are often compensated in the $10,000 to $15,000 range.
What influences the final decision?
If there is a speculative assignmentand there usually is with a search consultantthen fulfilling the assignment is critical. Is the strategy insightful? Does the creative match the strategy? (One consultant was harsh: "If it's brilliant creative, but doesn't reflect their own strategy, the shop loses.") Does the creative just parrot the client's strategic ideas? (Rewards do not go to lazy thinkers.) Next, there is the need for "integrated communications." More than buzz words, agencies must demonstrate they can integrate communications across all media. And for shops that survive the face off to this point, chemistry is the tiebreaker. As the consultants agreed: "Chemistry colors everything."
The actual voting is generally left to the advertiser. Most consultants guide and focus the client, but dont play an active role in the final decision. (However, a prominent consultant said, "I won't allow my client to make a mistake.")
For the loserswhat was missing?
Often a losing shop has "a big gap between the agencys top creative talent and the next level." However, a smaller agency can turn this to advantage if they can promiseand deliverthe agencys top talent as someone agile enough to be seen, heard, and felt on every account.
Well, there you have it. There are currently 50 search consultants on the Four As list and theyre here to stay. So learn to luv em. (Youll be glad you did.)
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