<FONT COLOR="#FF0033"><B>Guest Article:</B></FONT> Biju Joseph Dominic: Advertising Industry: In desperate need of a revolution

Biju Joseph Dominic

Mudra

What happens if you put a frog in boiling water? It will sense the heat immediately and jump out. But if you put a frog in normal water and heat the water slowly, the frog keeps getting used to the rising temperature. When the heat is too much for the frog to take, it is too late. It dies in the boiling water.

The advertising industry is in boiling water. The ad industry is no more an integral part of the client's strategy team. The few creative stalwarts that the clients look up to for creative solutions are clearly an exception.

Studies have shown that most knowledge based industries get paid 10 to 60 times more for their per hour work as compared to the ad industry. The easy days of media inflation and 15 per cent commission filling up the cash counters are long over. Since then the per hour income of several ad agencies have come down more than five to fifteen times in the last few years. Even the best of the ad agencies do not have any credible reasons to ask their clients for incremental per hour income year on year. Most of the agencies are making up for the short fall in income by indulging in short term, self defeating solutions such as underpaying their employees or over working their employees.

A few years back, I asked the CEO of a leading advertising agency to point out at least one person from the junior rank, who has the potential to become the CEO of that agency, 20 years down the line. He could not point out even one person.

Shortage of talent in the industry has reached scary proportions. The industry is forced to put 'trespassers will be hired' boards outside their offices. With the talent buckets leaking all over, the ad industry senior management including even the ad industry CEOs have no option but to attend client meetings which few years back would have been handled by the agency's middle management.

For the past several years, clients have been exhorting the ad industry to change. They have been shouting at the top of their voices that the 'dream factory is on fire'. Over the years, the speeches by some of the biggest advertisers at the 4A's functions clearly echo this feeling.

It is clear that the ad industry is struggling to hold its head above water. But these tell tale signs of the 'temperatures rising all around' are lost on the ad industry that evaluates itself not in the market place but at the industry award functions. There is no other industry in the world that gives itself so many awards. But the biggest irony of all most all those

awards is that those awards do not take into consideration the effectiveness of the ads in the market place, the only reason for which the clients have spent their hard earned money for. It is also a fact that most of those award functions are huge profit making events, masquerading as barometers of industry strength.

The distress calls from the market and the clients are lost in the self congratulatory applause coming from the beaches of Cannes. The self congratulatory mood of the industry even as it facing severe all around pressures, reminds me of the old Roman Empire. The decline of the mighty Roman Empire started ever since it accorded more importance to winning fights at the amphitheatres than in the battle fields in the borders around the country.

What needs to be done to make sure that the ad industry does not become the modern version of the mighty Roman Empire?

Ad industry needs to understand that it cannot survive unless it's per hour income dramatically increases. To get the clients to pay more for their services, the agencies will have to become much more accountable for contributing to the client's revenues.

There have been no paradigm shifts in the knowledge base of the advertising industry for decades. In the absence of any new knowledge, most ad agencies survive by talking exactly the same language, they spoke decades back.

Taking a cue from successful knowledge organisations, ad agencies need to make substantial investment in developing an even deeper understanding of the consumer and the communication process. This newly created knowledge will help ad agencies increase their per hour income.

To develop new perspectives in consumer understanding and communication, agencies will have to attract a talent pool from much more wider fields than today. The existing job profiles will have to be completely rewritten so as to retain good talent. Good talent does not come cheap. So to pay more salaries the agencies will have to get more income for their services. It is a catch 22 situation...

A mere incremental change in its workings is not going to help the ad industry to tide over this difficult situation. Nothing short of a revolution is going to help.

Any revolution begins in the minds of the brave few who have done an honest appraisal of the existing situation and have realised that the existing situation is so bad that incremental changes will at best delay the inevitable tragic end. The ad industry leaders, who believe in the need for a revolution, please stand up. The time to make a difference is now.

I am very happy to be living in these interesting times.

( The writer is vice-president with Mudra Communications, Mumbai. You can write to him at

b.dominic@mudra.com)

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