Why agencies need to do for themselves what they do for their clients.

Advertising agencies, like everything else, are brands. Yet as a group, agencies are as undifferentiated as cows on a hillside. Of the 12,000 firms in America that call themselves “advertising agencies,” painfully few of them have a unique reputation of any kind. When you deal with clients in this situation, chances are you would help them carve out a meaningful position in the marketplace. You would help them develop a branding strategy.

Agencies need to do for themselves what they do for their clients: build a strong, distinctive, memorable brand. But they are usually so eager to be a “full-service integrated agency” that they try to stand for everything. Crack the pages of a typical agency brochure and you see language like this:

“Jones & Smith is a full-service, diversified marketing communications firm serving a wide variety of client, from health care to high technology. From advertising to public relations, from television to Web sites, we offer comprehensive solutions to every client’s marketing problems.”

Or this:

“The Roberts Group is dedicated to making clients successful by generating results through effective advertising, public relations, and related marketing communications.”

While it’s good and noble to want to produce results for a client, that should be the purpose of every agency. There’s nothing differentiating about the notion of producing results. There’s also nothing differentiating about being “full-service,” “diversified,” “integrated,” or “comprehensive.”

Is it any wonder that most clients have no idea what distinguishes one agency from another? Standing for everything is just another way of standing for nothing. As Bill Bernbach said, “If you stand for something, you will always find some people for you and some against you. If you stand for nothing, you will find nobody against you, and nobody for you.”¹

Another way of looking at the issue of branding for agencies is to ask, “What reason can we give prospective clients outside our market to do business with us?” Most agency-client relationships are the result of proximity – you simply happen to be close by. But what about the larger accounts (with more money) that are 2,000 miles away? How can you throw your hat into that ring?

Allen Rosenshine, CEO of BBDO, observed, “Over the last decade, agency identities have become more muddled, less distinguished, and unfortunately, more like commodities than brands. And every day we come dangerously closer to confusing our clients about who we are, what we are, and why we are valuable to their business.”²

Imagine the credibility problem of a restaurant claiming to specialize in French and Mexican and Brazilian food. Ad agencies are no different. An agency that puts everything on its menu might as well have no menu at all. As Confucius said, “Man who chases two rabbits catches neither.”

Brand Strategist Adam Morgan wisely observes that when it comes to defining a brand, we must not only decide what we are, but what we are not.³ It jolts many agency professionals to realize that the goal of defining a strong agency brand isn’t to try to appeal to a larger number of clients, but fewer. A great Thai restaurant appeals only to those who like Thai cuisine, not everybody who likes food.

A brand is more than a familiar name

Just because others have heard of your agency doesn’t mean you have an agency brand. Name awareness and brand equity are only indirectly related. A lot of us have heard of agency names but we have no idea who they are, what they do, or what they stand for. These agencies have name awareness but no brand equity.

Branding puts meat on the bones of simple awareness. Once a prospective client knows the answer to the question, “Who are those guys?” the next question he has is “What are these guys all about?” Just like any other product category, clients like to buy brands, not generic products.

The generalist vs. the specialist

“If the essence of advertising is differentiation,” observes one agency executive, “not only are all agency offerings virtually indistinguishable, so is the level of differentiation that they can offer their clients. There are now hundreds of virtually identical agencies, all producing an un-original me-too product.”⁴

It’s a challenge to distinguish one firm from another in a world of agency generalists. Consider what a difference it would make if your agency became more of a specialist. For starters, who charges more for their services, the generalist or the specialist? A family doctor or a brain surgeon? Not only does the specialist make more money, but a good brain surgeon is likely to attract business from all over the country, not just his own community. And brain surgeons don’t compete with every other doctor in the country – only other brain surgeons. Could this logic possibly apply to ad agencies?

Marketing consultant Jack Trout argues that being a specialist creates a strong halo effect:

“People are impressed with those who concentrate on a specific activity or product. They perceive them as experts…Conversely, the generalist is rarely given expertise in many fields of endeavor no matter how good he or she may be. Common sense tells the prospect that a single person or company cannot be expert in everything.” ⁵

Why have traditional department stores died while niche players like Home Depot, PetsMart, and Office Max have thrived? It’s a story of the generalist vs. the specialist. Business consultants Michael Treacy and Fred Wiersema advise companies to stop trying to be all things to all people and instead find the unique value that it alone can deliver to a chosen market. The essence of their best-selling book, The Discipline of Market Leaders, can be distilled into three sentences. “Choose your customers. Narrow your focus. Dominate your market.” ⁶

It’s just like the client who wants everything in his ad to be of equal size – the photo, the headline, the copy, the logo. Wise agencies remind their clients that all emphasis is no emphasis. The same is true for the way agencies position themselves.

You can’t please all of the people all of the time

Agencies do a great job of helping their clients achieve distinction in the marketplace. There’s no reason why your agency can’t do the same – with a distinctive philosophy, distinctive capabilities, a distinctive identity, and a distinctive way of doing business.

In other words, you shouldn’t just be concerned with building an agency, but with building an agency brand. Jim Mullen, founder of the respected Mullen agency says, “A smart organization takes pains to define its brand identity and manage its public perceptions among all of its key constituencies by continuously reinforcing its core values. Only a foolish organization will allow its brand perceptions to be shaped by the street or, worse yet, by its competitors.”⁷ Yet, more often than not, that’s how most agency reputations are created.

If you transform your agency from a commodity into a brand, you will naturally exclude some people. Not everybody will be a prospective client. That’s because branding means creating strong, sometime polarizing differences. Some clients will be attracted to you and some won’t. That’s O.K., because the ones who are attracted are strongly attracted. And that’s what gives the agency its competitive advantage.

It’s a scary proposition for most firms to think about intentionally limiting their audience. But, as Adam Morgan likes to say, “the greatest danger facing a brand is not rejection, but indifference.”⁸

Or as Bill Cosby once said, “I can’t give you the formula for success, but I can give you the formula for failure: try and please everybody.”

Underpromising and overdelivering

You could visit, at random, any one of the thousands of companies who call themselves advertising agencies (or design firms, or PR firms, brand consultancies), pick up their promotional literature, and you might be tempted to believe that they are very close to perfect.

According to their brochure, they have a reputation for outstanding service, brilliant creative work, attention to detail, making deadlines, delivering out-of-the-box thinking, executing killer media buys, and saving the client money. Not only are claims like these naïve, they are quite unbelievable. Every client knows that very few agencies can do all of that, all of the time.

Ironically, the agencies who really are that good never claim to be. They prefer soft sell over hard sell, knowing that the credibility of their brand is at stake. They actually underpromise, then overdeliver. They usually produce not just better work than other agencies, but vastly better work.

In fact, on every important dimension of quality, great agency brands are a clear cut above the norm.

A strong agency brand is a brand with both substance and style. The substance part is unequivocally first and foremost. I can’t count the number of times I’ve walked into the lobby of what looks like a very impressive agency (a lot of style) only to find that behind the marble reception desk lies an agency that’s no better than any other (very little substance).

A fashionable look is not a brand. A cool business card is not a brand. A staff that dresses entirely in black is not a brand.

These could all be elements of an agency brand, but not the essence. The best agency brands don’t just have quality offices, they have quality work. And they don’t just talk about producing quality work – they actually do it.

Discovering your agency brand

You don’t define your agency brand as much as you discover it. It’s already there, deep inside your agency soul, in the form of your natural strengths and core competencies. When you plumb the depths of your agency character, you begin to wonder about several crucial questions:

• What is the best way to focus our agency for the future?
• What do we need to change to achieve our new focus?
• How can we make sure we stay true to our new focus for the long term?

The key word here is focus – the willingness to stand for something.

Discovering the agency brand cannot be a matter of deciding the future of the agency over lunch. To produce a lasting effect, defining the brand must involve all the major stakeholders: principals, management, and employees. The best place to start is by asking all of these groups their opinions about where the agency is now. You can usually get a good read on this by asking five simple (but not easy) questions:

1. Does the agency have a distinctive mission or positioning that makes it different from other agencies? If so, how would you define it?
2. How well do you think the agency lives up to its mission or positioning?
3. Should the agency's mission or positioning be different? If so, how?
4. What do you perceive to be the agency's greatest strength?
5. What do you perceive to be the agency's greatest weakness?

In most agencies, the answer to question number one is usually “no.” Comments like these are common:

“I don't recall ever reading or hearing the mission of the agency. It's not even in the company brochure or in the employee manual.”

“I haven't been aware of an official agency mission other than producing great advertising and making lots of money.”

Those willing to take a stab at attempting to describe the “mission” usually do it in vague terms:

“To provide outstanding creative solutions to every advertising, marketing and public relations challenge.”

“To offer the best advertising, PR and other marketing communications to our clients.”

“To serve all of our clients’ communications needs.”

It may or may not surprise you to learn that for most agencies, this is as good as it gets. Pretty pathetic for the industry that invented positioning.

Ken Roman, the former head of Ogilvy & Mather, was fond of reminding his staff, “The essence of positioning is sacrifice.”⁹ That’s why defining a brand is so difficult for agencies; it involves sacrifice. It means giving something up. It means not only deciding what you are, but what you are not. In fact, sacrifice is the very core of defining a successful agency brand. As branding consultant Al Ries says, “If there is no sacrifice, there is no branding strategy.”¹⁰

In branding your agency, the goal is to be exclusive, not inclusive. To divide perceptions, not unify them. To appeal to some clients, but not all clients.

To most agency principals, this is pretty scary stuff. But ultimately, agencies need to find the answer to the question, what reason can we give important prospective clients outside our city to do business with us? Just like any other successful product or service, agencies need a meaningful and distinctive position in the marketplace.

Bringing the positioning to life

Once your positioning has been defined, it’s time to ask the soul-searching question, “What needs to change in our organization in order for us to bring our positioning to life in everything we do?”
It’s not just a matter of producing a slick new agency brochure, ordering new letterhead, and revising the Web site. Branding starts from the inside out. It’s reflected in five important areas of your business (which, coincidently, all start with the letter “P”):

1. Your product
2. Your people
3. Your promotion
4. Your process
5. Your place of business

Bringing the agency brand to life is all about aligning your product, people, process, promotion, and place to support the brand. In other words, it’s about aligning your practices with your positioning. Agencies that are serious about establishing an agency brand begin to ask questions like this:

Product

1. Do we need to add new services and capabilities?
2. Do we have the right clients?
3. Do we need to do a better job of integrating your services and capabilities?
4. Do we need to find new business partners?
5. Do we need to develop new strategic alliances?

People

1. Do we have the right people with the right skills?
2. Do we have them in the right assignments?
3. What kind of new people do we need to hire to support our agency brand?
4. Have we clearly defined roles and responsibilities for all employees?
5. Have we adequately defined our expected performance outcomes?
6. What kind of standards should we apply to selecting new employees?
7. What kind of training program do we need to help employees live the brand?

Promotion

1. What immediate changes do we need to make in our agency corporate identity?
2. How can we more narrowly define the criteria we apply to prospective clients?
3. What should we say differently in our self-promotion materials?
4. How should our new business approach change?
5. How can we better use publicity to tell the story of our agency brand?

Process

1. Does the agency need to be organized differently to better support the agency brand?
2. Do we have agency systems and procedures that run counter to the brand?
3. What changes or improvements should we make to the way jobs are processed through the agency?
4. Have we allocated the right resources to the right clients?
5. Is our workload distributed evenly?
6. What changes should we make to the way our services are priced or the way we are compensated?

Place

1. How can we change our working environment to better reflect our positioning?
2. What do we need to do to our offices to make a different first impression?
3. Are we providing an environment in which our people can do their best work?
4. Do our people have the right resources?
5. How can new or different technology help us achieve our branding strategy?

Right about now you might be thinking that you really don’t have time for this. After all, you have a business to run. Clients to serve. Payroll to meet. Too many urgent issues and problems to be spending time thinking about fluffy things like agency branding. You could, of course, simply keep doing what you’ve been doing. Just remember that the definition of insanity is repeating the same behavior expecting different results. And you’re really just talking about saving hours when in fact you may be wasting years.

There is no better use of your time than thinking deeply about how to set your agency apart from the competition. “Differentiate or die” is a warning worth heeding.¹¹ Defining what makes your organization different, then making it different, is the best leadership you could possibly provide your agency.

It’s also quite possibly the best way to add value to your agency, whether you plan to sell it some day or not. According to most estimates, the average market value of well-branded companies (including agencies) is about 70 percent greater than the value of their tangible assets.

Chances are your agency is already doing a good job of adding value to your clients’ companies. How about taking the time to add some value to your own?

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• Outcomes of a clear agency positioning »
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