The Adverati are once again gathered in Cannes for the annual ego festival. The business press is also in place, in case anything important happens. If nothing important happens, the press will fall back on what someone said.
According to Reuters, Mark Read, Co-Chief Operating Officer of WPP, and the holding company’s former digital boss, said some things.
The world’s biggest companies are not questioning the value of spending on their brand or message, rather they are changing how they target consumers in a world of mass, but fragmented, content.
Just like us, clients realized that they needed to more radically examine their costs, he said. If you look at the production of content, clients don’t want a 5 percent reduction in the cost, they want an 80 percent reduction.
So it’s about redirecting resources and sometimes that requires a more radical examination of your cost to take the legacy cost out and redirect it to the future.
Read is acutely aware of the price pressure that clients are placing on agencies, sometimes for legitimate reasons. Plenty of agency budgets are bloated and there’s a lot of fat that can be carved from the agency beast, but an 80% reduction is not a fat-trimming exercise. It’s death by a thousand little cuts.
Creativity Is Never A Commodity
Everyone in the agency business knows what “price pressure” feels like. It’s common haggling and as common as daybreak.
We can blame clients for not properly seeing the value in our specialization, or in our ability to broadly solve marketing problems. Or we can blame ourselves for not properly establishing our true specialty and its marketplace value.
Clients don’t argue with their doctors, accountants, and lawyers about price because they don’t think they know better than these board-certified professionals. But advertising…I mean how hard can it be?
— WPP (@WPP) June 20, 2018