It’s About the Clients, Stupid

MonsterBy Peter V. Stanton

With the announcement of the Publicis-Omnicom merger, the first thought that comes to mind is “What about the clients?”

That does not seem to be the first thought in the minds of either CEO.  Maurice Levy of Publicis stated blandly that “…size will matter.” Omnicom chief executive John Wren said the merger would enable the new behemoth to “…leverage [my emphasis] a tremendous roster of global and local clients.”

What neither said was that the two-headed monster would be better able to “serve” its clients, or that the resulting conflicts were in any way beneficial to those clients.  Fundamentally, this is a bad deal for clients of both firms and a breach of the faith they entrusted in the individual firms at the time each was retained.

Whether it is advertising, marketing, public relations or anything else that falls within the broad definition of communications these days, what really occurs when a client engages a firm is that a relationship of trust is established.  The client trusts that the agency will share its business objectives and apply its best talent, creativity and energy to the realization of those goals.  After more than 30 years in the agency business, I have never known a client relationship to be about anything else.

Sure, clients want the work done economically and they want to know their firm has the resources to do the job in an efficient and creative fashion.  And surely on the ad side, there is the imperative to secure the best rates.  But in the end, it inevitably comes down to whether the client and the agency share the same priorities.

With Coke and Pepsi now under the same roof, how can that be so?  Of course: the new firm will claim that separate account teams and firewalls will ensure the integrity of the work.  Were this the merger of two law firms, one representing a plaintiff and the other a defendant, would that claim hold water?  It will not in this case either. That has been the fundamental flaw in the holding company model since its inception.  Not everyone has turned a blind eye.

At a recent meeting in Cracow of public relations agency heads from more than a dozen different nations, the common emphasis was on the importance of independence.   At a time in our industry when it seems every firm is somehow owned or allied with one of the global holding companies, there remains a strong commitment to independence and a view of its inherent value for clients.

The independents care about one thing – clients.  They mount fierce battles to win business against the global monoliths that increasingly are chasing smaller budgets in their desperate pursuit of growth.  Once independents win those clients, the quality of the work and the integrity of the service take over.  Within the independents, you still hear professionals discuss the “craft” of public relations or communications.  The independents dedicate senior professionals to every client engagement and not just to the sales presentation.  A firm president I admire stated recently that he has no interest in growing his business above a certain level because he believes only at a fairly modest scale can he assure clients the attention and care that is his hallmark.  Imagine the wrath that would befall a mega-agency head who set the firm’s business model at “small and client-centric” versus “growth-oriented.”

The requirement to meet shareholder forecasts leads to another major problem the global one-stops prefer you ignore.  Clients that have used the multi-nationals report an innate tension between their priorities and those of holding company shareholders.   The latter seek strong quarterly returns, while the former require a longer-term horizon.  Independents understand the periodic need to accept budget limitations or reductions from clients even as programs for those clients continue apace.  The emphasis in the independent firms is on long-term partnerships rather than short-term budget achievements.

In a field whose very name references relations, it is the relationships of trust between clients and agencies that matter most and produce the best results.  When those relationships are fostered, great things happen.  When they are subsumed to the interests of “size” and “leverage,” clients lose.

A presidential campaign was won in recent history on the basic statement, “It’s about the economy stupid.”  The campaign for the future of the communication profession might easily paraphrase that slogan in light of the Publicis-Omnicom merger.

Peter V. Stanton is the President and CEO of Washington, DC-based Stanton Communications. This blog entry originally appeared in his firm’s The Strategy Room Blog . Peter is an accredited member of the Public Relations Society of America and its distinguished Counselors Academy. He has served on PRSA’s continuing education faculty. He is published on the practice and principles of effective communications. He is a member of The National Press Club and holds graduate and undergraduate degrees from Loyola University in Baltimore. You can reach him though the Stanton Communications website and through Twitter.

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About prsancc

The National Capital Chapter of the Public Relations Society of America (PRSA-NCC) is a professional public relations organization of more than 1,400 members in the Washington, D.C. metropolitan area. The Chapter provides professional development programs, accreditation instruction, and networking events. The Chapter also promotes public relations education through five area Public Relations Society of America Student chapters, as well as a Career Academy for inner city high school students. For more information, please visit http://www.prsa-ncc.org or call (703) 691-9212.

One thought on “It’s About the Clients, Stupid

  1. Peter, thanks for writing about this. The Economist had a really good piece in its Aug. 3 issue on the proposed merger and what it means for the advertising (and by extension PR) industry. I would recommend it to anyone who cares about the future of our business.

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