GoaFest2008: Ad agencies should bring more value to the table

At GoaFest 2008, a session with two speakers, Harit Nagpal, director, marketing and new services, Vodafone Essar, and V Shantakumar, chairman, Saatchi & Saatchi, started as a skit, carried on as a debate, and then turned into a discussion, with both parties finally agreeing with each other.

The session, called Adwaale: Kaarigar ya Kalakaar, started with Shantakumar and Nagpal enacting a skit where the former plays a tailor and the latter, a small-time shop owner who wants to get a suit stitched.

The conversation between the two has the shop owner trying to explain what kind of a suit he wants and the tailor pushing his luck and saying he wants to go abroad to get the perfect material for the suit. While they discussed this, their presentation connected it to the advertising industry and said, “Pushing personal wishes into the script.”

Shantakumar then pointed out that the agency should understand its client’s needs and have the courage to lose the business if it wishes to be known as a true artiste.

Nagpal talked about how clients outsource work to agencies because they are “specialised units” and because clients can’t do that kind of work on their own.

While the session was meant to be a debate, Shantakumar said that he agreed with Nagpal on many points. He said, “What is it that we are doing that could change the value paradigm? We keep complaining about costs being cut. Do we ever get beyond the transaction? Rather than protest about money, we should look at what we are being paid for and what value we generate as an agency.”

He said he felt that the fundamental problem was that ad agencies are known as “agencies”, which is related to being brokers. Or mere facilitators of a client’s ad spend, which catch the commission that falls. Apart from real estate agencies, commodity brokers and arms dealers, no industry in the world works on a commission basis.

Shantakumar pointed out that agencies have to be accountable. “We cannot hope to be a partner in another’s business if we are not accountable.” He said he felt that if a client has sleepless nights because his brand is not making a profit, the agency should too, and not just worry about whether the 30 second ad went on air or not. “Once we are accountable, it frees our mind to think out of the box, to think beyond the 30 second ad. If we are committed to be custodians, we have to go all out.”

“We want to be valued better, but we have to perform better,” he said repeatedly.

Another point made at the session was that the less you can do something yourself, the more you’ll pay somebody else to do it. The two pointed out that ad film directors, photographers and research agencies make the most money in the business because clients and ad agencies don’t want to or cannot do these jobs. Then the client also says to the agency, “I gave you the insight and the brief.”

At this juncture, R Balakrishnan (Balki), chairman and chief creative officer, Lowe, who was in the audience, made the point that the value that agencies bring to the table is the value of the idea.

Shantakumar said, “Agencies are not structured to create value. We are not coming up with the goods. Then how do we expect to be valued? We need to be prepared to be more involved.”

Nagpal agreed here that clients do not involve the agencies as much as they should. But Shantakumar exclaimed, “We barge into meetings anyway. We should barge into client meetings, too!”