The Difference Between 2007 and 2010 in PR/Ad Agency Battle for Social Media

In 2007 I wrote about an AdAge article that focused on the battle for social media client budgets between ad agencies and PR firms.  At the time, the popular momentum, or at least AdAge’s view was that advertising agencies were better prepared to capture this opportunity.  Ad agencies have definitely had some high profile wins blending social media and traditional advertising, with Wieden + Kennedy being at the forefront with their work for Old Spice.

Despite the success of the recent Old Spice campaign, in 2010 Ad Age is singing a different tune with an article headlined, “Social Media Helping Public Relations Sector Thrive.”  I think PR is going to continue to grow into advertising spends with social media for a few reasons.

Different Types of Time

PR agencies for the most part are structured to make money and bill clients based on billing for the time their employees spend working on projects for clients.

Most ad agencies are structured to make money based on buying time on media.  This allows ad agencies to generate much higher revenue in general than PR agencies of the same relative size.

The thing with social media is that there aren’t huge ad buys.  Sure, there are some. There is integration with print ads, and television and radio campaigns. There are also online ad buys, but these don’t have the dollar amounts or margins associated with them that broadcast buys do.

Social media is about people putting in time to interact with other people. That’s what PR agencies do.  They used to just do it with reporters, now they do it with everyone.

Campaigns vs Engagement

Most advertising programs are built around campaigns that have a specific beginning and an end.  Some social media activities are structured as campaigns with a beginning and an end, but more often they are about long-term customer and public engagement.  This isn’t something that ends.

What now?
Ad agencies and PR firms are becoming more adept at creating products to sell or to demonstrate their chops. This may be social media monitoring tools or widgets to distribute information, but they are all things to sell to try and add value to clients and allow them to be more of a one stop shop. This move to development on both sides is going to continue, but I’m going to keep my bet on the PR agencies, at least the smart ones to continue to pull ahead.

You never know who you’re going to touch or inspire

I was just at home, having lunch with my wife who had just returned from volunteering in the classroom of one of our daughters. Before I go further, let me set for perspective that my wife was a classroom teacher for seven years.  There was a student in my daughters’ class with learning disabilities and a dedicated assistant to help them.

Our discussion at lunch was about trying to mainstream students and also about how our daughter hadn’t mentioned anything about the other student acting out at all this year, which he did several times while my wife was in the room.

On the way back to the office, it’s a five minute drive- if I miss a light, I was listening to the BBC and there was an interview with Natalie Merchant talking about her song, “Wonder. and the unintended impact this song has had with parents of children with special needs.

Maybe, I’m just getting old and soft, but it was an incredibly powerful interview that spoke to people finding inspiration all around them.  So, my message for the day is don’t give up on people, just help them and help them find inspiration.

Also, I highly encourage you to listen to the whole interview, at the BBC site it’s about six minutes.

Agency Lessons from Mad Med Episode 405 – “The Chrysanthemum and The Sword”

Over the past few years, I’ve been writing about real agency lessons from Mad Men episodes.  Season four continues to include real issues faced by advertising (and yes PR firms) in an incredible show. If I wasn’t in this industry, I’m sure I would still be a fan of the show, but for me I get a bonus. I get to watch situations I encounter all the time dealt with by others.

The origin of the “Chrysanthemum and The Sword,” episode title is a 1946 book about Japanese culture by Ruth Benedict, and it is required reading around Sterling, Cooper, Draper, Pryce (SCDP) as the team has the opportunity to pitch the Honda motorcycles account. According to what Pete Campbell has heard, the company which has 50% of its market is unhappy at Grey (a much more established firm).  This gives me the chance to point to Ed Moed’s great blog on a “mole free environment.”

A few points for agency folks from this episode:

  • Do you go after all new business? What if you can’t afford to pitch it?; and
  • It’s OK for younger employees to thrive – just don’t tell Roger Sterling; and
  • Your competition is who the market thinks is your competition, not who you do.

The Honda pitch comes with a few strings:

  • Roger Sterling has very, very strong feelings against the Japanese based on his having served in WWII and lost friends in the war;
  • There is a cap of spending $3,000 on the pitch and the rules of the pitch specifically prohibit presenting finished work such as a full television commercial;
  • SCDP has recently lost two pieces of business to an upstart firm, CGC; and
  • Money is tight at SCDP so even if they wanted to spend a lot of money on the pitch, they can’t.

Don Draper would like to actually shoot a full commercial for the pitch, but since they can’t afford to shoot it on spec, they assume that similar-sized firm CGC can’t either.  The SCDP creates a ruse wherein they trick CGC into thinking they are shooting a commercial for the pitch and then after CGC presents their commercial to the prospective client, Don resigns from the process with his thinking driven by a quote from The Chrysanthemum and The Sword;

“A man is shamed by being openly ridiculed and rejected. It requires an audience.”

Without reading into how this quote should impact Don in his real life, we see that he benefited his firm by learning about his potential client and their culture.  As CGC didn’t follow the rules, SCDP didn’t feel they could participate and by viewing the spec commercial Honda had broken their own rules. Lesson learned?  Use all available information. No, don’t go out and try and be sneaky, but know the playing field and use all available tools to help you and your agency.

The next issue for agencies in the episode is the “passing of the torch.”  There is a confrontation where Pete Campbell tells Roger Sterling that he is sabotaging the potential Honda business as he is afraid winning new business will make Roger less valuable to the firm as his primary client, Lucky Strike, accounts for 70% of revenue.  Reminder to Roger, clients don’t stay around forever, it helps to have someone who wants to hustle and bring in new business. Reward them. They’ll remember and be much more likely to keep you around after your big client can’t advertise on TV any longer.

The episode opens with Don Draper getting a call from Walter Hoffman of the NY Times asking if he has a comment on the new business recently won by CGC away from SCDP.  The reporter quotes the principal of CGC, Ted Chaough, as saying, “Every time Don Draper looks in his rear view mirror, he sees me.” Don’s response? “I’ve never heard of him.”  Whether Don views CGC as competition or not, the NY Times does, and more importantly potential clients do.

Don’s tune changes and he takes CGC seriously, given his antics described above to try and take them out. Your competition is who the market compares you to.

Agency Lessons from Mad Men Episode 404 – “The Rejected”

Image from AMCTV.com

Over the past few years, I’ve been writing about real agency lessons from Mad Men episodes.  Season four continues to include real issues faced by advertising (and yes PR firms) in an incredible show. If I wasn’t in this industry, I’m sure I would still be a fan of the show, but for me I get a bonus. I get to watch situations I encounter all the time dealt with by others.

The big issue I’m going to focus on here is one I’ve written about before:  loyalty.

Pete Campbell hasn’t always made the best decisions. OK, that’s an understatement. He’s usually a spineless cad (wow, that was fun to write).  In episode 404, “The Rejected,” he gets a chance to make a good decision, and act as a good and loyal man, even if it may be for the wrong reasons.

Pete’s father in law is in charge of the marketing decisions for Clearasil.  It was his position that allowed Pete to bring this important account to the new Sterling, Cooper, Draper, Pryce (SCDP)and become a partner.

SCDP has recently brought on board the Pond’s account which according to the new client is in conflict with the Clearasil account.  Since the Pond’s account is bigger than the Clearasil account, Pete is tasked with telling his father in law that they have to resign the account.

I’m a big believer in “dancing with the one that brung ya.”  Clearasil went with a new agency and they deserve a little loyalty for taking a risk.  Pete might feel the same way a a bit, but more than likely he just doesn’t want to lose leverage at the agency, since Pond’s isn’t his account, and he doesn’t want to have to tell his father in law that the agency he took a risk on is firing them.

So, Pete steps up and “encourages,” his father in law to bring more business to SCDP bringing the total billings to more than Pond’s so they get to keep Pete’s account.

The end result is that SCDP stays with a client that helped them get started.  My point is that it doesn’t always matter why you do the right thing, as long as it gets done.

Lots of talk about social media stuff that “sucks”

I just read two separate posts focusing on social media content that sucks.  The first is about video that sucks, and the second is about copy writing that sucks.

A few months ago, I wrote about how the “C word,” was now banned here. It’s still banned but it’s still a problem.  Don’t focus on creating “content.”  Make stuff people want to see and read.  Stop focusing on the technology of delivering this stuff and do it well.  Hire professionals.  There are lots of very good writers, videographers, photographers and editors looking for work. Hire them and leave the “social media experts,” on the sidelines.