Wednesday, November 23, 2005
Integrated Marketing- The new price of entry
The New York Times yesterday (Click headline for link) quoted new CEO McCleeland's arrival at advertising agency Cliff Freeman as "indicative of the efforts that agencies are making to bolster the ranks of senior management to address the challenges they confront as consumer behavior and media continue to change.
Mr. McCleeland's experience in what is known as integrated marketing -
that is, campaigns that include non-traditional elements as well as
conventional outlets like TV and print - is of particular value as
marketers strive to broaden their media selections beyond the usual choices".
McCleeland goes on himself to say, "Now for an agency, integrated marketing is the price of entry to compete for clients," Mr. McCleeland said. "You can't talk to them without the goods."
We could not agree more. And it's particularly gratifying to have a maverick like Cliff Freeman agreeing with the position we have held for years now, ever since Omnicom owned DAS CEO Tom Harrison began expanding his roll-up strategy. While Integration has been an enigmatic goal for many since Stanley Tannenbaum's book "Integrated Marketing Communications" was published in 1992, it was not until Harrison really initiated the momentum amongst the nearly 200 Omnicom marketing services companies in his DAS group which now contributes well over 50% of Omnicom's revenue.
Harrison,an ex-entrepreneur who founded one of the first DAS companies, Harrison Star,has now written his own book, "Instinct" (Warner business Books 2005).
While this book deals with entrepreneurial instinct and not integrated marketing specifically, Tom's inspiration to integrate marketing services is raw entrepreneurialism and the opposite of the bureaucracy some holding companies are falsely accused of.
Omnicom refers to itself as a holding company of talent. But one could argue that that is just another way of saying a holding company of entrepreneurs.
Like Tom, many of the DAS company CEOs founded and built their companies from the ground up. I have built two and now work for a Global giant holding company.
In every discussion with Tom and other senior Omnicom executives, the subject is entrepreneurial. It's what the Harvard Business School would call the Service Profit Chain based on the book written by Professor James Heskett, Baker Foundation Professor at the Graduate School of Business and Len Schlesinger, CEO of The Limited Inc.
Integrated Marketing is simply the exploitation of Jim's SPC.
Each marketing company used to deliver customer service is a link in the chain. As the cliché goes, "a chain is as strong as it's weakest link".
But the chain needs to be strategically grounded to be relevant and must be executed on a simultaneous but integrated basis.
This is where most integration becomes disintegrated as the marketing services silos retract into their own shells to execute their discipline and deliver their P&L at the expense of integration. (See 11/15 post).
Tom recognized a long time ago what others are just seeing now. Integration is not a theory or a new buzzword for a fad. It's good business.
But like any good business, it needs to be properly structured and managed. This has been the challenge in the past. Now we have developed best practices based on years of solid experience and in market results.
Marketers no longer have to pay for experimentation. Provided they hire experienced people to set up and run Integrated Marketing according to proven best practices.
Mr. McCleeland's experience in what is known as integrated marketing -
that is, campaigns that include non-traditional elements as well as
conventional outlets like TV and print - is of particular value as
marketers strive to broaden their media selections beyond the usual choices".
McCleeland goes on himself to say, "Now for an agency, integrated marketing is the price of entry to compete for clients," Mr. McCleeland said. "You can't talk to them without the goods."
We could not agree more. And it's particularly gratifying to have a maverick like Cliff Freeman agreeing with the position we have held for years now, ever since Omnicom owned DAS CEO Tom Harrison began expanding his roll-up strategy. While Integration has been an enigmatic goal for many since Stanley Tannenbaum's book "Integrated Marketing Communications" was published in 1992, it was not until Harrison really initiated the momentum amongst the nearly 200 Omnicom marketing services companies in his DAS group which now contributes well over 50% of Omnicom's revenue.
Harrison,an ex-entrepreneur who founded one of the first DAS companies, Harrison Star,has now written his own book, "Instinct" (Warner business Books 2005).
While this book deals with entrepreneurial instinct and not integrated marketing specifically, Tom's inspiration to integrate marketing services is raw entrepreneurialism and the opposite of the bureaucracy some holding companies are falsely accused of.
Omnicom refers to itself as a holding company of talent. But one could argue that that is just another way of saying a holding company of entrepreneurs.
Like Tom, many of the DAS company CEOs founded and built their companies from the ground up. I have built two and now work for a Global giant holding company.
In every discussion with Tom and other senior Omnicom executives, the subject is entrepreneurial. It's what the Harvard Business School would call the Service Profit Chain based on the book written by Professor James Heskett, Baker Foundation Professor at the Graduate School of Business and Len Schlesinger, CEO of The Limited Inc.
Integrated Marketing is simply the exploitation of Jim's SPC.
Each marketing company used to deliver customer service is a link in the chain. As the cliché goes, "a chain is as strong as it's weakest link".
But the chain needs to be strategically grounded to be relevant and must be executed on a simultaneous but integrated basis.
This is where most integration becomes disintegrated as the marketing services silos retract into their own shells to execute their discipline and deliver their P&L at the expense of integration. (See 11/15 post).
Tom recognized a long time ago what others are just seeing now. Integration is not a theory or a new buzzword for a fad. It's good business.
But like any good business, it needs to be properly structured and managed. This has been the challenge in the past. Now we have developed best practices based on years of solid experience and in market results.
Marketers no longer have to pay for experimentation. Provided they hire experienced people to set up and run Integrated Marketing according to proven best practices.
Tuesday, November 15, 2005
A New Breed of Executive needed- Integration Experts
The following article appeared in the Wall St Journal today. (They still don't get viral media so no link, here is the whole article).
"They all talk about it, but everyone is having a difficult time of doing it," says Al Stefl, senior vice president of communications for Nestlé USA.
At Omnicom we have been doing it for the last six years. The only thing we agree on is that it is not easy.
But we are apparently five to six years ahead of the pack in experience based on this article.
So to Al Stefl and any Marketers frustrated by the difficulty, if you really want true integrated marketing from your marketing services companies, we know how to get it done.
We have done it for Mercedes-Benz and other blue chip brands in the USA. We are doing it for Bank of America Globally. Exxon-Mobil is benefiting from the shortened experience curve as the best practices learned the hard way are applied in people, process and technology are being honed into leading edge Global practices.
We can apply it regionally and even retail like 7-11 and Lowe's.
There's no business like Integrated Marketing. Don't experiment with people who have not learned the hard way. Experience.
Multimedia Killed the TV Star:
Ad Firms Revise Their Approaches
By SUZANNE VRANICA
November 15, 2005; Page B9
The makers of television commercials have long called the shots at most Madison Avenue ad agencies, reflecting the central role historically played by TV in advertising. But as advertisers put more emphasis on direct marketing and other techniques, the center of gravity within agencies is shifting.
Rising in prominence are executives who can devise ad campaigns that integrate all types of media, including less-glamourous "marketing services," such as direct marketing, public relations and "in-store" advertising.
In a sign of this shift, ad agency Publicis USA this week is expected to promote the head of a marketing-services unit, Debbie Yount, to a new post with the encompassing title of "chief holistic officer." Ms. Yount's job is to get agency staffers to think less about TV-centric campaigns and to devise campaigns that use whatever media suits the client's target audience.
[Debbie Yount]
Ms. Yount will have access to all of Publicis' clients and will report to Susan Gianinno, the ad shop's chief executive. That puts her on an equal level with regional ad agency heads who also report to Ms. Gianinno. Publicis USA is a unit of Paris-based Publicis Groupe.
Two other agencies took steps in the same direction last week. WPP Group's Ogilvy & Mather decided to combine the internal profit and loss statements of its ad agency and its OgilvyOne marketing-services unit in North America, hoping to encourage the two businesses to collaborate rather than compete for client dollars. The firm also elevated executives from the two units to be co-chief executives of Ogilvy North America.
In a similar vein, Interpublic Group's Foote Cone & Belding plans to hire creative executives capable of generating ideas that can be used in all types of marketing -- not just TV. Money for the hirings will come from eliminating a layer of existing management, the firm said last week. "Agencies are waking up to the fact that it isn't about TV anymore," says Steve Blamer, chief executive of FCB.
The shift on Madison Avenue comes as new technologies, such as digital video recorders, are making it easier for viewers to avoid TV ads. Just last week NBC Universal agreed to offer ad-free versions of some of its broadcast and cable shows on an on-demand service offered by DirecTV. "Consumers are not waiting around to see our next 30-second TV commercial," says Ms. Yount.
Advertisers increasingly see TV ads as one part of a broader campaign that might also include online ads, public relations and direct marketing. To devise such campaigns, agencies have to get their different units to work together.
That's a task easier said than done. Creative executives have long treated colleagues in marketing services "as poor second cousins and not respected" their businesses, says Ms. Gianinno.
"They all talk about it, but everyone is having a difficult time of doing it," says Al Stefl, senior vice president of communications for Nestlé USA, referring to the ability of agencies to break down barriers and move beyond TV ads.
At Publicis USA, Ms. Yount won her stripes by playing a key role in winning business from Tumi, the luggage maker. Rather than showing off a conventional TV commercial, the standard centerpiece for such a pitch, Ms. Yount's team skipped TV and proposed a campaign revolving around airport advertising.
For several years, Publicis Groupe CEO Maurice Levy has argued that the firm needed to use a "holistic" approach to servicing clients, rather than focusing on TV. The firm was one of the first to merge internal profit-and-loss statements for advertising and marketing services.
"They all talk about it, but everyone is having a difficult time of doing it," says Al Stefl, senior vice president of communications for Nestlé USA.
At Omnicom we have been doing it for the last six years. The only thing we agree on is that it is not easy.
But we are apparently five to six years ahead of the pack in experience based on this article.
So to Al Stefl and any Marketers frustrated by the difficulty, if you really want true integrated marketing from your marketing services companies, we know how to get it done.
We have done it for Mercedes-Benz and other blue chip brands in the USA. We are doing it for Bank of America Globally. Exxon-Mobil is benefiting from the shortened experience curve as the best practices learned the hard way are applied in people, process and technology are being honed into leading edge Global practices.
We can apply it regionally and even retail like 7-11 and Lowe's.
There's no business like Integrated Marketing. Don't experiment with people who have not learned the hard way. Experience.
Multimedia Killed the TV Star:
Ad Firms Revise Their Approaches
By SUZANNE VRANICA
November 15, 2005; Page B9
The makers of television commercials have long called the shots at most Madison Avenue ad agencies, reflecting the central role historically played by TV in advertising. But as advertisers put more emphasis on direct marketing and other techniques, the center of gravity within agencies is shifting.
Rising in prominence are executives who can devise ad campaigns that integrate all types of media, including less-glamourous "marketing services," such as direct marketing, public relations and "in-store" advertising.
In a sign of this shift, ad agency Publicis USA this week is expected to promote the head of a marketing-services unit, Debbie Yount, to a new post with the encompassing title of "chief holistic officer." Ms. Yount's job is to get agency staffers to think less about TV-centric campaigns and to devise campaigns that use whatever media suits the client's target audience.
[Debbie Yount]
Ms. Yount will have access to all of Publicis' clients and will report to Susan Gianinno, the ad shop's chief executive. That puts her on an equal level with regional ad agency heads who also report to Ms. Gianinno. Publicis USA is a unit of Paris-based Publicis Groupe.
Two other agencies took steps in the same direction last week. WPP Group's Ogilvy & Mather decided to combine the internal profit and loss statements of its ad agency and its OgilvyOne marketing-services unit in North America, hoping to encourage the two businesses to collaborate rather than compete for client dollars. The firm also elevated executives from the two units to be co-chief executives of Ogilvy North America.
In a similar vein, Interpublic Group's Foote Cone & Belding plans to hire creative executives capable of generating ideas that can be used in all types of marketing -- not just TV. Money for the hirings will come from eliminating a layer of existing management, the firm said last week. "Agencies are waking up to the fact that it isn't about TV anymore," says Steve Blamer, chief executive of FCB.
The shift on Madison Avenue comes as new technologies, such as digital video recorders, are making it easier for viewers to avoid TV ads. Just last week NBC Universal agreed to offer ad-free versions of some of its broadcast and cable shows on an on-demand service offered by DirecTV. "Consumers are not waiting around to see our next 30-second TV commercial," says Ms. Yount.
Advertisers increasingly see TV ads as one part of a broader campaign that might also include online ads, public relations and direct marketing. To devise such campaigns, agencies have to get their different units to work together.
That's a task easier said than done. Creative executives have long treated colleagues in marketing services "as poor second cousins and not respected" their businesses, says Ms. Gianinno.
"They all talk about it, but everyone is having a difficult time of doing it," says Al Stefl, senior vice president of communications for Nestlé USA, referring to the ability of agencies to break down barriers and move beyond TV ads.
At Publicis USA, Ms. Yount won her stripes by playing a key role in winning business from Tumi, the luggage maker. Rather than showing off a conventional TV commercial, the standard centerpiece for such a pitch, Ms. Yount's team skipped TV and proposed a campaign revolving around airport advertising.
For several years, Publicis Groupe CEO Maurice Levy has argued that the firm needed to use a "holistic" approach to servicing clients, rather than focusing on TV. The firm was one of the first to merge internal profit-and-loss statements for advertising and marketing services.
Kirshenbaum and Bond a bridesmaid-again
No-one likes an I told you so. But on 08/24 I wrote in "BMW Review Update" that this fine agency whttp://www.blogger.com/img/gl.link.gifas unlikely to be able to win an automotive account.
I know having talked to the MDC people that they are not thrilled with the costs of finishing second, which is as we have said before, the most expensive place in an agency review.
AdAge today reported that GSD&M won the BMW business from , the final two. (Click link on title for full article).
The reasons will never be public. While I am delighted for my kissing cousins in Texas who won, I really feel for Jonathan and Richard. They deserve better. There should be more automotive business run out of New York. Maybe they will finally get the message that as brilliant as they are, they need specific automotive help to break this multiyear multi pitch losing steak on automotive accounts.
Win the next one guys, hire a specialist. Not a "Car Guy" in the derogatory sense, but someone who can go toe to toe with a Tom Purvis (BMW CEO) and be credible. Someone who can help you overcome the inherent prejudice automotive companies have against New York agencies which was well articulated in Rothenberg's "Where Suckers Moon".
It's hard guys, but there are people out there who can help you next time. And there will be a next time.
I know having talked to the MDC people that they are not thrilled with the costs of finishing second, which is as we have said before, the most expensive place in an agency review.
AdAge today reported that GSD&M won the BMW business from , the final two. (Click link on title for full article).
The reasons will never be public. While I am delighted for my kissing cousins in Texas who won, I really feel for Jonathan and Richard. They deserve better. There should be more automotive business run out of New York. Maybe they will finally get the message that as brilliant as they are, they need specific automotive help to break this multiyear multi pitch losing steak on automotive accounts.
Win the next one guys, hire a specialist. Not a "Car Guy" in the derogatory sense, but someone who can go toe to toe with a Tom Purvis (BMW CEO) and be credible. Someone who can help you overcome the inherent prejudice automotive companies have against New York agencies which was well articulated in Rothenberg's "Where Suckers Moon".
It's hard guys, but there are people out there who can help you next time. And there will be a next time.
