Peter Levitan & Co.

The New Business of Advertising

Smart Agencies

Would You Buy Your Advertising Agency?

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If You Put Your Advertising Agency Up For Sale… Would You Buy It?

I could turn the important question, “Would you buy your advertising agency?” into a long blog post. But, good news, I won’t. I’ll get to the point.

I just finished listening to Kara Swisher interview Khosla Ventures’ partner Keith Rabois – On The Future Of Innovation In Silicon Valley on Recode Decode.

Wowzer… is this guy smart and opinionated. Please listen to this interview. I also follow him on Twitter – @rabois.

This is his investment criteria. If you applied it to the sale of your agency, would you buy you?

What is anomalous? (As in, deviating from what is standard, normal, or expected.).

What “secret” is the company predicated on? What could this be?

Could this be one of the most important companies on the planet?

What is the accumulating advantage?

Can the founder attract the talent requisite to achieve the vision?

Why do we have a comparative advantage?

These are really tough questions. Especially if you think that advertising, PR and design agencies can’t generate meaningful differentiation. But, they can.

Are you working on that?

Will you ever sell your advertising agency?

I sold mine. It took a very strategic effort to build value a year plus ahead of that sale. If you want to sell your agency, even a couple of years from now, you need to build it for a sale.

Ask the big question… “Would you buy your agency?” If the answer is no. Well, its time to rethink your offer.

I have written more about selling an agency: Will you ever sell your advertising agency?

 

Advertising Agency Strategic Planning And Insights

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How Your Advertising Agency Can Leverage The Value Of Strategic Planning And Insights For Growth

I am sitting next to a 1.5-inch three-ring binder from Saatchi & Saatchi Advertising Worldwide called “Saatchi Insight. Strategic Planning Tool Kit”. This book was our advertising agency strategic planning and insights bible.

 I took this tome with me when I left Saatchi in 1995. At that time, I was running business development across North America and, sadly, this was the last year that Maurice and Charles Saatchi ran the company. No, don’t be too sad. The brothers went on to build the smarter M&C Saatchi and I moved into digital marketing and publishing. I believe, as do many, that 1995 was the end of the great Saatchi & Saatchi reign.

The “Saatchi Insight. Strategic Planning Tool Kit”.

This toolkit includes 15 sections with strategic process brand names like MASTERBRAND, BRAND Detonator, The Saatchi Temple, The Consumer Connector, Funneling, The Media Monitor and Scenario Planning (at a time when this term was rarely used outside of Saatchi). The brand names helped position us as super smart in our new business pitches and, of course, with resolving existing client issues.

I’ll be hitting up insights from this book in a few blog posts because I think that advertising agency marketing-oriented strategic planning is an underutilized agency specialty. I strongly believe that having a clear and compelling strategic program can be a differentiator for today’s look-alike advertising agencies. [Read more…] about Advertising Agency Strategic Planning And Insights

Cures For Poor Advertising Agency Profits

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Cures For Poor Advertising Agency Profits

I work to provide cures for low advertising agency profits. That is my specialty. I do not get many calls from super successful, as in high-margin agencies unless they are very very hungry to expand.  I LOVE those call from the relentless.

Here Is A Key Question

Within the range of the business questions that I use at the start of an agency business development assignment, there is one simple, but revealing question:

Why do you run your advertising, PR, digital agency?

This question generally yields a somewhat standard answer…

The marketing communications industry (advertising, digital marketing, PR) is fun.

No surprise here. Marketing hits many sweet spots including working with a wide array of clients and their issues (great for advertising people with ADHD); delivering marketing that drives sales is fulfilling; the daily use unique skills; being paid for creative thinking; working with fun people; it beats owning a dry cleaner shop. I don’t usually get told that people make a pant load of money. For most ad shops, those days are (unfortunately) over.

Super high-profit days are in the past due to the move to fee-based compensation; absurdly competitive price cutting; the art of giving services away for free; incessant cost-cutting; increasing workload; increasing advertising platforms; staffing issues; the commoditization of services; claiming the impossible to own “we are creative”; not zeroing in on the most important client need of all… business results.

OK, OK, Enough!

Elemental Cures To Grow Advertising Agency Profits

[Read more…] about Cures For Poor Advertising Agency Profits

Does Your Advertising Agency Do Content Marketing Right?

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Is Your Advertising Agency A Savvy Content Marketer?

I’ve read acres of advertising agency content (blogs, white papers, videos, on LinkedIn, etc.). Some rock and some suck. Many agencies, once they have stellar content, do not put in the effort to spread the wealth. As in, they do not amplify their brilliant thinking across a range of social media and traditional marketing platforms. This is a missed efficiency driver. Here’s a how to maximize your hard content building work.

To be clear, ‘content’ means the stuff that agency’s use to deliver their insightful thought leadership programs which are designed to sell the agency’s brains, expertise and to drive inbound visits and interest. Just for the hell of it, here is the definition of content from Google…

A type of marketing that involves the creation and sharing of online material (such as videos, blogs, and social media posts) that does not explicitly promote a brand but is intended to stimulate interest in its products or services.

Here is another well-crafted definition from the Content Marketing Institute…

Content marketing is a strategic marketing approach focused on creating and distributing valuable, relevant, and consistent content to attract and retain a clearly defined audience — and, ultimately, to drive profitable customer action.

Great Content: Part One

One of the best content marketing companies I’ve visited/read is TrinityP3 an Australian-based global marketing management consultancy with offices on four continents. TrinityP3 is a primary thought leader in the advertising client and agency space.

Darren Woolley, founder and Global CEO, along with Mike Morgan, are the driving force behind TrinityP3. To date, they have hundreds of blog posts covering a wide range of subjects including agency management, agency search, compensation, media buying, procurement, and scope of work and, even infographics. I’m talking lots of content.  [Read more…] about Does Your Advertising Agency Do Content Marketing Right?

Harley Davidson And Ad Agencies

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Let’s Start With Ad Agencies

It is nice to see that ad agencies are willing to pivot.

I read today that Cal McAllister of Seatle’s now closed Wexley School For Girls is starting a new agency. Having visited Wexley in the now distant goodish old days, I am not surprised that Cal has shifted from running a super creative ad agency to a specialized ‘new and improved’ version. The new Paper Crane Factory is dedicated to growing early stage business and is teaming up with VC’s in Seattle and Silicon Valley. As Cal says in ADWEEK (strangely at Cannes — well, I guess it’s a good old-fashioned place to launch a new age agency)…

“The opportunity to do game-changing work with brands is happening at a much earlier stage,” said McAllister during last week’s Cannes Lions.

McAllister is initially opening offices in Seattle and Silicon Valley, taking a leaner and digitally focused approach with his client base and building more around equity with partners, as opposed to the traditional agency model.

“The billable hour—I think is broken,” noted McAllister. “The fact is, the way agencies make the most money is by putting more people on jobs and having it take longer. This is precisely what clients don’t want now. We are focused on taking clients who are willing to pay part of the fee in equity, so our wins are their wins, and their wins are our wins.”

A New Model Ad Agency

Let me start by saying this type of agency isn’t a brand new idea. However, aiming to work with start-ups for equity plus fees is a decent 2018 idea for a new agency.

A key point for my readers is that the agency is highly specialized. Wexley worked with a range of clients. Paper Crane Factory is dedicated to a much narrower category. It is a hell of a lot easier to be distinctive when you are specialized that a generalist.

Harley Davidson And President Trump And Advertising $

I never get into politics here. However, it is becoming clear to me (and, I hope you) that Donald Trump does not actually understand big business.

The news that America’s great brand Harley Davidson is moving manufacturing and jobs to Europe and, a few months ago Thailand, is a direct result of two #MAGA policies that clearly do not get how large-scale manufacturing works. Or, how a public company should work for its shareholders. As in, grow sales and profitability. (See below.)

Europe’s tit-for-tat motorcycle tariffs are obviously a result of the #MAGA trade tariffs (and an interesting aim at Wisconsin) and the move to Thailand is a direct result of America’s withdrawal from the Trans-Pacific Partnership (TPP.)

Why does this matter? More of this type of movement of USA dollars to foreign countries is, I think going to accelerate. This move will result negatively on large brand USA advertising.

According to S&P, 43% of Fortune 500 sales happen overseas. If, as in Harley Davidson, your USA sales were in decline while sales in Europe and Asia were growing, where would you put your ad dollars?

(Below…)

Harley Davidson would have to raise the price of each motorcycle it ships to the EU by $2,200 if production doesn’t leave the U.S.

That’s a dealbreaker, considering Europe is Harley’s second-biggest market (driving 15% of its revenue).