Agencies boost biz acumen with client marketers at helm

The culture of an agency trickles down from the leader in the big corner office and some industry watchers believe there is a real line in the sand being drawn between agencies headed by someone on the creative versus the account side of the business. We're also seeing additional business acumen being brought to the mix with the migration of senior client marketers to top agency spots.

The culture of an agency trickles down from the leader in the big corner office and some industry watchers believe there is a real line in the sand being drawn between agencies headed by someone on the creative versus the account side of the business. We’re also seeing additional business acumen being brought to the mix with the migration of senior client marketers to top agency spots.

For example, Chris Jordan, a veteran with both client and agency experience, recently signed on as president and CEO of Young & Rubicam Canada. In addition, former Molson Breweries VP and global advertising director Rob Guenette has moved over to be CEO at Wolf Group Canada in Toronto, while Labatt Breweries’ director of marketing, Mike Robitaille, has become a partner in Labatt’s new agency, Grip.

Richard Foster, of Toronto headhunting firm The Richard Foster Company, attributes this trend to a desire on the part of agencies to offer integrated marketing services, which clients have come to demand more and more. Having a former client marketer as agency head, he says, would appear to make the shop more open to other solutions as opposed to just a large TV effort.

‘They understand that if you have a tool bag, [traditional] advertising is just one of the tools. [Client leaders] may be a little more understanding about it being a direct marketing or sales promotion issue and will try to offer integrated services to clients.’

But does leadership from outside creative ranks run the risk of making one agency less creative than another?

Alan Middleton, associate professor of marketing, Schulich School of Business at York University, thinks there is a risk to an agency’s creative reputation when it brings in a client president.

‘Aggressively creative people won’t go to shops they see as business management dominated. The goal is to get an equal balance between the two [business and creative]. Our [Canadian] ad agencies lurch between being strategically checked out and dull and boring, to creative but completely lacking in strategy. I see very few agencies that occupy a comfortable middle ground.’

He says the appeal for agency groups bringing in a client-side person as president is their broader palette of business management experience.

‘The diversity of management issues you’ve had to face and involvement in more senior-level strategic planning tends to be much greater than somebody who has just come up the agency side.’

Chris Staples, partner at Vancouver agency Rethink, suggests clients take note of whether an agency is headed by someone with a creative or business focus, since they go to an agency for creative expertise, and already know how to run a business.

‘If you have an agency that isn’t owned by people who are creative, you have to ask yourself why you’re even there in the first place. To me that’s the big reason you’re hearing clients squawk about agencies so much – it’s because agencies aren’t providing the service they were intended to provide, which is big creative thinking.’

Staples believes that the perfect agency model is similar to Rethink’s, where the ownership represents both the account and creative sides of the business. For large multinational agencies, he explains, it doesn’t matter whether they’re headed by a creative, account or client person because the culture isn’t dictated by them, it comes from the owner in New York or Europe. He points out that such agencies are in the business of generating 18% profit every quarter for their parent company, while a smaller shop like Rethink is in the business of ‘coming up with breakthrough creative ideas that will move a client’s business.’

‘We’d be the last people to talk to [clients] about the actual running of their business,’ he adds. ‘That’s not what agencies are supposed to do.’

But many senior industry executives don’t agree with this philosophy. Doug Lowe, SVP and chief of staff at Young & Rubicam in Toronto, argues there isn’t a surefire textbook on how to run an agency, and that every shop has its own set of circumstances due to its clients and the members of its senior leadership team.

‘From our perspective with [Jordan], we think we’ve got the best of both worlds. This is somebody whose recent history is not only on the client side with high profile, senior marketing positions but his background is also agency. We don’t feel that we’re taking a great leap of faith from that perspective because this is somebody who obviously has done both sides before.’

In an ideal world, says Lowe, the agency head knows a thing or two about leading an organization and it shouldn’t matter if the person comes from the client, creative or account side if they’re a team-oriented leader.

‘There are plenty of case studies of pretty creative shops led by account people. It depends on their overriding philosophy and what priority they put on the work. [They recognize] that they’re going to have to have the appropriate person in place to drive the creative. They let that person do their job so they can do theirs.’

While Jay Bertram, new president of TBWAChiatDay in Toronto, hasn’t had client-side experience, he has worked at three agencies with very different cultures and values: J. Walter Thompson, TBWAChiat Day and most recently at Cossette Communication-Marketing as SVP corporate development.

He believes it’s really the people assembled around the agency leader that counts. ‘If [the leader] is a client, creative person or a pure account guy, they’re still going to add to their team other skill sets that are different from theirs. That makes the team stronger.’

While someone from the client side would bring a new perspective and understanding of client needs to an agency, Bertram believes that agency leaders today have a greater sensitivity to the pressures that clients are under and how agencies can help.

‘Good people are good people,’ says Bertram. ‘There are great client leaders who would be great agency leaders as well.’

Rob Guenette would concur with that viewpoint. He was a very involved client and vocal supporter of advertising and the Canadian industry while on the client side at Unilever and then at Molson. Guenette believes that since he loves the advertising business and has a long history in positioning brands he’s well suited to run an agency.

‘The skills and discipline you require to run an agency are the same that you need to run any business,’ he says, adding that he knows the difference between running an ‘ad agency versus running a donut shop or a manufacturing facility.’

‘I find already that most of my skills are transferable because I’m treating this business as a brand. As a client, you run profit and loss statements all the time so running a balance sheet is not the challenging part. Positioning the business within its community and making it attractive to clients – that’s the part that needs the work.’

Guenette’s first task at Wolf will be to fix what he sees as its biggest problem – its lack of a clear positioning in the marketplace. He says he will rename the agency later this year to reflect that repositioning.

The new Wolf CEO also believes it’s folly to assume that just because a former client or an account person is running an agency it will impact creative product negatively. With his business background, however, he did feel it was important to have the right creative partners at Wolf. He brought former BBDO team Craig Cooper and Briony Wilson in as co-CDs to fill that role.

As a result, while he concedes he’ll approach business from a client perspective, he believes it will not dumb down the creative process. ‘I’m going to take the same principles to this agency that I had as a client – creative advertising that works. It builds brands and produces results.’

On the client side, Mike Welling, VP brand development, foods at Unilever Canada, implies that an element of business maturity and understanding at the agency level has become essential. ‘You advertise not for the purpose of saying ‘look at the wonderful piece of art I produced,’ you’re looking to stimulate consumer behaviour to generate revenue or a behaviour change,’ he explains. ‘You have to make sure [the agency] has an appreciation of that. If [the president] is a creative director, they need to find somebody who has the appropriate business skills to make sure the day-to-day business of an agency is being run.’

Welling says there isn’t any reason why a creative head couldn’t run an agency but it also depends on the size of the agency. The bigger an organization gets, he believes, the tougher it is for one person to continue to try to wear multiple hats, and this diminishes the amount of time they have to oversee creative product.

Adds Welling: ‘A client perspective is good because it’s very easy in an agency environment for people to be caught up in the notion of the creative process for the sake of the creative process. They forget the business realities clients are faced with. The best agencies are where they get the best blend of these skills.’

But he also adds that when it comes to a client heading up an agency, it depends on the talents of the person. While he expects Rob Guenette to be successful at Wolf Group because of his experience and skills, he admits others may not fare as well.

David Strickland, SVP of marketing for Zellers, agrees that not everyone can make the jump from client to agency or vice versa because the businesses are so very different. But he is also wary of agencies that put too much emphasis on creativity. ‘Certainly if it was a creative person [in charge] who thought the only thing that makes a difference between success and failure is the creative, then that would worry me.’