Why would a company need an advertising agency?

Melbourne Herald Sun, Thursday January 30, 2014
Do companies still need advertising agencies? Especially the big corporations, which these days control most of the food we buy in a packet, the supermarkets we shop in, the cars and petrol - just about everything we consume.

Each has a big staff of marketing people, and PR divisions, all very bright and qualified and highly paid. So why bother with an agency at all?

Modern computer graphics mean after a few months' training a bright secretary can produce an acceptable looking ad. Even TV commercials are easy - hire a freelance cameraman, pick presenters from staff, maybe even run an office competition for ad ideas.

The advertisements have already been written - by the company's sales and marketing teams during their goal-setting bonding weekend at a resort in Queensland or Bali.

You know what you want to say because you spent a whole day developing your mission statement, and that covers it all.

Your marketing manager gives the campaign to a media placement company which negotiates excellent spots on the top-rating TV shows and in the best pages in magazines and newspapers.

Just name the date, everything is done, didn't need an agency at all, it's launching on Sunday.

And the world is exposed to yet another meaningless, excruciatingly boring, totally mis-directed advertising campaign, of which we are seeing so many these days.

The trouble is that companies, with a few notable exceptions, do not understand advertising. In fact some of the big ones scarcely understand marketing. Yet they believe they can develop an advertising campaign.

Well it's all laid out for them. In the world of the board room it all comes down to the share price and stock holders' returns. If a product is doing poorly it will be axed or retired to the back of the stock cupboard.

If an innovative competitor is making inroads into their market, that's great. They buy it, making the inventor happy and rich, and add it to their stock list. They already know that the public wants the product, so they don't have to create anything new.

The alternative is to bring in a favourite from an overseas division. "This sweet is a huge hit in Brazil and taste tests show Aussie kids will love it too." And the work is done. Marketing with your eyes shut.

But those of us who aren't giants, still have to market the old fashioned way. Develop a product, cultivate a market, generate consumer desire, find distribution and sell furiously.

Here companies face a problem. Their marketing people know the product too well, they see it with all its history and problems, talking to the same people about it every day, they lose the big picture.

This is why they still need agencies. Ignorant of the history, agencies are outsiders - a team who don't know your product intimately, but they do know what the public is searching for, they know the consumer's heart.

The company knows where the product fits in their manufacturing and financial mix. But a good agency can identify a product's consumer market position. Their objective view is not always the same as the client's.

Then the agency, if it's any good and the creative process is allowed to run freely - can add that sprinkle of magic dust. The creative campaign, which will get the product noticed, tried, talked about. It has to make the product exciting, desirable. The client has lived with it for several years. The agency should see it with fresh eyes and present it as new and sexy.

Phil Ruthven Shows the More Things Change, the More They Haven't Changed At All

Melbourne Herald Sun, Thursday January 23, 2014.

Those were the days my friend, eh? Well, actually, no. Those supposedly great bygone days were rather crummy and if there was a very best time to choose to be alive - this is it.

I've been reminded of this in a report by one of my favourite people, economist Phil Ruthven. We are lucky to have Phil around in this land full of bull dusters and fantasists. Because when they tell us that we are working harder, earning less, struggling more, suffering bad health - Phil takes up his keyboard, punches in a century's worth of Australian Bureau of Statistics and other data, and proves that it just ain't so.

What about that hard work you're doing, and all that commuting? Well it turns out the number of hours worked in a lifetime are the same now as they were in 1800. What has changed is your lifetime - you have twice as many years to spread out those 80,000 hours, so each day's work is halved.

What about "a woman's work is never done"? They work harder than men don't they? No. Years of surveys have shown that adding up the things that men work at and those that women do - maybe one drives a truck, the other feeds the kids - give you much the same number of hours worked by each.

So have we run out of full time jobs compared to the good old days? No, the figure of 40 percent of the population in a daily job has been pretty constant for 120 years.

Gee at this rate we'll have nothing left to argue over at the pub! What about the fact that we are all getting old? Well yes, the average work participation age is around 40, whereas in 1901 it was 30. But then, what is old? It no longer makes sense to say "Life begins at 40" because most of us are still well into the swing of things at that age. Instead we hear "70 is the new 60". In just 50 years average life span has gone from 67 to 78 years, so 40 is just half way.

Much of the improvement in our lives comes from science and medicine, social flexibility, nutrition and education. And it's in these areas that politicians need to encourage, finance, allow growth - and stand back.

A half century has seen the throwing out of oppressive sex discrimination, homosexual illegality, wife bashing, child beating. Some still happen of course, but now they are not "allowed".

Trade is free almost anywhere, any time, whether it's shops opening or ships importing. There's universal superannuation. And our university population has risen from 50,000 to 1.4 million. All in just 50 years.

What have we have lost - stable marriages? No. For three hundred years marriages have averaged 20 years. It's just that living longer, we are more likely to take a second or even third pick of the cherry. 20 years at a time.

But with the growth of violence around the world we have more murders now? No. Recent figures put the homicide rate at 1.3, down from 1.9 in less than a decade. That's your chance in 100,000 of being done in. Should make you feel pretty safe.

OK here's a good one: we all have more vehicles than ever. Yes? Nope. If you count your horse, bicycle, buggy, whatever was your "personal transport", you get an average 1.6 vehicles per home - for 200 years.

We didn't have TV, computers, cheap flights - so you're living in the golden age. Enjoy it.