Powerful or Grateful?

What kind of an employer are you?

For the last few weeks I have been reading and watching the new Microsoft advertising asking you whether yours is a people ready business. Very thought provoking, if you pause for a couple of minutes and reflect. While Microsoft finally wants us to buy its software, I would like to thank it for bringing a rather intriguing and burning issue to the fore.

The introduction to the campaign is really smart. I quote verbatim from the Microsoft website.

‘A people-ready business is a business that knows people are its most important asset. ‘

‘A people-ready business believes that people, more than processes, systems, machines, location, or outside consultants, are the ultimate drivers of business success.’

Almost everywhere I go these days, from almost everyone I meet, I hear sounds of optimism about business. Double digit growth, diversification, new launches, new markets, exports, outsourcing, insourcing, being recognized by overseas partners and parents, winning accolades by prestigious newspapers and magazines, parent company’s head honcho’s visiting our market, wining big deals. We are passing through exciting times indeed.

I also hear a litany of complaints and frustration. Mostly about people, human resource, talent. Mostly about youngsters. Lack of commitment, no sense of loyalty, flexible views on integrity, openly flirtatious behaviour, excessive ambition, money mindedness, undisciplined, scant respect for experience and seniority, gossipy, impatient, attitude problems. We are passing through exciting times indeed.

All of us know that talent is no longer an easy issue. The challenge is large enough everywhere, perhaps the most acute in service businesses, where talent is all that we have. In service businesses, talent is not just human resource. As we say at Starcom MediaVest Group; it’s our raw material.

Almost all businesses face difficulty these days of finding, attracting, and retaining top talent. It’s not as if people are in short supply. In fact, people with great academic degrees are not difficult to find either. Why do managers complain then?

As I reflect on the manager’s dilemma, it appears to me that a lot of us are trying to solve a 21^st century issue with tools that were useful a couple of decades ago. No wonder, we get frustrated so easily.

Should we redefine employment?

With the exception of dot coms, and other new age companies, most other firms are run by CEOs who started working a decade or two ago. In those days, there were more qualified people than good jobs. Result: many people applied to dozens of companies with the hope of getting a favorable response from at least one. Many of us were fortunate to get a decent job and unsurprisingly, stayed in that job for a long time. Problem of plenty was faced by some lucky ones who got into one of the few business schools or professional courses.

Those less fortunate were to wait longer to get a job. Some tried using recommendations. Some went to employment bureaus. Most were underemployed.

The equation was simple. Your parents managed to get you educated and you got a degree. You needed to find gainful employment. When you got employed, you felt loyal and paid back to the company over a period. The company, your employer, was the powerful benefactor and you were the grateful beneficiary.

My guess is, most of us who grew up in that old world forget that it’s a very different world today. The drives, aspirations, patience, risk appetite of today’s young people are fundamentally different from what we had.

As far as really qualified talent goes, we might be better off turning this whole employer-employee argument on its head. Perhaps we should think of the people as the benefactors and the firm as the beneficiary. Instead of expecting gratitude from our people for having given them a job, we should perhaps be grateful that they have decided to work with us. More than ever before, today’s young people are agents of their free choice. Perhaps we should explore ways of making ourselves attractive to them. It’s not that firms didn’t try to make themselves attractive to prospective employees in the past; they did. In my view, what we didn’t do was to keep ourselves attractive to the people who have already chosen to work with us. That’s something we need to do now.

Who should be loyal to whom?

Many people talk about employee loyalty and do all kinds of things, mostly little monetary incentives, to keep employees loyal. How many of us have given a serious thought to being loyal to our people? Beyond uttering platitudes, what do companies really do to communicate their loyalty? Do our militaristic, top-down structures allow two way loyalty to foster? How many of us hide behind policies to stifle the innate innovativeness of our people? How many of us truly empower our front line people? The old time lalaji employers are reputed to get personally involved in the lives of their people, they knew their employee’s family, and stood by during stormy weather. How many of us new age employers care enough to do that kind of stuff? Or is there so much of b-school in us, that we must make the work place and our relationship with our people, dehumanized, un-emotional and ‘professional’?

Why train someone who will leave soon in any case?

This is a popular grouse I hear. Training costs money and many managers don’t want to waste it behind people, who they know, will leave. I empathise with these managers. They are only trying to save their company precious financial resources. My question is: how do you know who will leave when? Are training and growth not a few of the things people leave to get elsewhere? By not investing enough behind training and skills development, do we not pretty much push our people away and make our own prophesies come true?

What do we look for when hiring?

Experience? Skills? Talent? I know the answer to such a leading question. But how many of us truly look for talent when hiring people? How many companies train their recruiters, often line managers, in spotting talent? Or do we take comfort in the safety of the prospect’s experience and skills? The truth is that the only thing we cannot teach within the organization is talent. Should we not invest a whole lot of managerial time and energy in looking for talent? We must. But we often don’t. Because it’s more difficult. And riskier. And most of us don’t want to go wrong. It’s so expensive. But can we ever avoid going wrong with people? I don’t think we can. That’s the beauty with people. We have to take chances with them. That’s what professional coaches are supposed to do with players. And their whole reputation depends on them. And even they know that unless they play enough prospects, they wont find a player.

Do we hire people around whom we feel comfortable?

Let’s admit it; that’s what we really do. Very few of us managers hire people who genuinely challenge our views. Whose work style might contrast with ours. Who make us uncomfortable, a little nervous perhaps. Exactly the kind of people we should be hiring to be effective in a world in which we did not build our early careers. People who can put some seeds of doubt into our heads. Who won’t hesitate looking us in the eye and disagree, when we are not right.

Do you hear that sound coming from the stomach? If you do, it’s a good sign.

[Published in the Financial Express on July 20, 2006]

Shut down the War Room!

Why the time has come to de-militarise Marketing Thinking.

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The two big, really devastating wars of our times, are several decades behind us. One of the reasons the world has managed to avoid wars of that scale is the rise of diplomacy relative to military as a way of settling disagreements. In fact, today’s generation so prefers living to killing and dying that it would rather restrict world ravaging wars to movies and video and console games.

The Marketing discipline, however, seems to have got trapped somewhere in the thought and actions of the war. In our boardroom presentations as well as everyday choice of language, we so glamorize the metaphor of war that every other way of settling our ‘scores’ with consumers looks nearly naïve. We describe consumers as ‘targets’, segments of them worth ‘capturing’, we talk of marketing strategies in terms of ‘frontal’, ‘flanking’ etc, we expect our marketing communication to be ‘impactful’, and we use ‘intrusive’ tactics of ‘shock and awe’, ‘carpet bombing’, ‘air cover’. We talk of our budgets in terms of ‘firepower’. When translated into creative and media, we quite proudly use phrases such as ‘striking when the target is least suspecting’, we want to ‘outmaneuver’ our competitors, ‘defeat’ or ‘neutralize’ them, and we often try to do this by having a larger ‘share of voice’.

The truth is consumers have evolved from the post WW II days, the glory days of the military and marketing. For a few decades in the last century, they tolerated our armed invasion of their unsuspecting mind. Then they developed their own defence. As media and brand choices exploded, consumers started assuming control. Today, that control is nearly complete, often fueled by technology. The biggest ambassador of technology, the Internet, deeply touches even those people, who don’t think much of it. But while the Internet is the ultimate fuel for choice, choice itself is more than that. Choice is in our TV remote, in our mobile phones…more importantly, choice in our mind, in what can be called the hidden remote. As consumers exercise choice on media, media fragments. Those of us who feel helpless blame consumers, media owners and anyone else who will listen, about the media fragmentation and spiraling cost of reaching consumers.

Our world today is fundamentally different from the one where many of us got educated. Consumers are beginning to reject our ‘exploitative’ marketing techniques. They are punishing us by forcing us to redefine our old notions of brand loyalty. They are telling us to ‘stay out’. They have neither the time nor the patience to hear our long winded ‘me Vs ordinary’ stories. They know our TV commercials are trying to sell, not entertain. And they are skipping ads that we spend millions making. When they are not skipping, they are tuning off, using the mental remote. They are making us question the elaborate systems we have put in place to measure the ‘eyeballs’. As far as consumers are concerned, the eyeball and the brain [or the heart, if you please] are actually two different bodyparts.

The military led marketing is so weak now that Sergio Zyman became a bigger hero when he wrote ‘End of Marketing as we know it’ in 1999, than perhaps he was during the 30 odd years he spent practicing ‘marketing as we know it’. I might not agree with all that is inside Mr. Zyman’s famous book; but I believe that title is even more apt today than it was in 1999.

Our World is truly Connected and Communication is not a part of Marketing; it is Marketing.

Today’s young generation is often referred to as the download generation, unlike some previous generations. described as the ‘Pepsi Generation’ or the ‘MTV Generation’. Brands have less of a meaning to the new generation than they had to us. Forget pushing down the brand story through the consumer’s eyeballs, today marketers cannot even afford to upset the consumer. This is how ‘money back guarantee’, ‘click to unsubscribe’, and ‘opt-in’ have risen in their popularity. In a connected world, people are happy helping each other make choices, rather than wait for brands to come and fight it out inside their minds. The reason why word of mouth is more important than ever. Today, there is no bigger fear to a brand than not knowing when a consumer has rejected it. This is why companies and brands in the evolved markets are falling over themselves to set up official blogs. The begging is loud and clear – “If you have to say something nasty about us; please tell us first”.

Our society is looking down on uncalled for aggression

This is one of many contradictions of our times. Individually many of us are more aggressive in life. You see that at the airport, at the hospital, on telephone. But we want our parents, teachers, elected governments and brands – all those authority figures that dominated us in the past - to control their aggressiveness. We want our parents to be ‘friends’ to our children, we want teachers to stop flogging us in school, our governments to know that if they get too aggressive, we can go on the streets and on the Net and tell everyone to bring them down, and we certainly do not want our brands to intrude our minds and fight for supremacy. Actually, we are far less forgiving of brand aggressiveness, because unlike in the case of parents, teachers and governments, where we have little or limited choice, in case of brands we have nearly unlimited choice, and we are willing to exercise it just to prove a point.

Acceptance of aggression by the target is a precondition for the success of the military. Do we still believe militaristic marketing can work today?

The time has come to change the metaphor

I have often heard the line about ‘half of my advertising money getting wasted’. Is it possible that most of the marketing money gets wasted because of the militaristic blood-letting? Anyone who has tried to win a share of voice [SOV] game in marketing and media will empathise with me. SOV wars are mostly not won; they are lost. I wonder whether over emphasizing the role of competition in business and marketing is not an intrinsically wasteful strategy. Some people agree, I would say. Perhaps why ‘Blue Ocean’ is such a big deal, as is ‘Permission Marketing’.

The time has never been riper for marketing to learn from disciplines other than the military. Diplomacy perhaps? Or, Religion? Or should we learn from how people make friends and fall in love? Do I have an answer? Perhaps. Perhaps not. What is clear as daylight to me is this: Marketing in the opt-in age is less about brands and their firepower than consumers and their power of choice and peer influence. The faster we learn and apply this, the more money we will save to invest in engaging with more people who will buy and recommend our brands to more of their friends. What more could we possibly want?


[Published in The Financial Express May 4, 2006]

Whose agents are advertising agencies?
Look truth in the eye, you will know.

More than a decade ago, before I joined this industry, I read about a guy by the name of Volney Palmer. Palmer was one of the earliest known 'advertising agents' in our trade's Mecca, the US of A.

Whose agent was Palmer? Back in the second half of the 19th Century, Palmer figured a very smart way of getting rich quickly, legally. He negotiated bulk deals with magazine owners and got them to issue him letters of exclusive representation on the promise of steady flow of non-subscription revenue. Then he went to potential advertisers, first timers mainly, and told them that advertising in magazines is sure to increase their sales several fold, and the only way they could advertise in some of the best known magazines, was through him alone and he had letters to prove his claim. He also told them that if they bought advertising space for a long period, say a year, and paid him in advance, he would sell them the space at cost. What's more, he can also help the advertisers save a lot of money by getting the magazines typeset the adverts themselves, no artist fees.

Lies. Lies. Lies.

Lie # 1: The magazines Palmer represented were by no means the 'best known'; the ABC was still decades away from being formed.
Lie # 2: He never intended selling any space at cost, he bought space as low as he could and sold them as high as the advertisers would pay and just claimed that was in fact his cost (there was no printed tariff card to disprove him anyway).
Lie # 3: He did not have the foggiest idea whether the ads would really increase sales, so he got magazines change the manufacturer's claims at the typesetting stage, and insert claims that were never meant to be there. That is how took birth one of America's largest ever categories, patent medicines, which were neither medicinal, nor had any patent. Often claiming to prevent or cure dozens of common and private ailments, patent medicines created more illnesses than they cured. But then that's another story .

Palmer and few other gents of his stature created so much havoc those days that they effectively postponed the growth of a whole segment of media owners - the newspapers, who refused to carry 'those adverts' in the fear that their literate gentry would reject any overt attempts to peddle them manufactured goods.

Jai Thompson: It was to save the whole advertising industry from being maligned and suspected forever and to bring in some semblance of credibility in the agents that a fellow called J Walter Thompson championed the system of Open Contract, which later came to be known as the 15 per cent system. Thomson's idea was simple; the agency brought wholesale business to the Media, who saved on the cost of approaching many Clients, and in turn gave the agency a wholesale discount of 15 per cent - no less, no more. It was a clean and transparent system, which worked largely because all media owners and all Clients followed it. Fifteen per cent having been assured, the agencies then focused on doing what they were perhaps meant to do - try and make each ad work harder and smarter than the previous and then the competitor's. This was when interesting concepts like USP was born.

Every new concept has to degenerate over time, as did this one. Someone wrote that while the battle raged to grab consumer attention in the face of a really debilitating depression, under pressure to deliver continuous revenue growth (does that sound familiar?), and comfortable in a percentage remuneration system, agencies did what, in retrospect, sounds absolutely expected. Find ways of increasing the Client's spend (15 per cent of 2X is double of 15 per cent of X, if my Maths serves me right). Result: Bigger ads, more ads in every campaign, more campaigns every year and so on.

The Fallacy of Composition, which states that what is true for an individual, is not necessarily true for the group the individual belongs to, for once failed. Most advertisers believed, often on prodding by their agencies, than you got to shout louder than your competition to be able to ram home your message into your consumer's mind. So what happens when everyone tries to shout louder than the next guy? Overall noise is louder than ever, which means you have to shout even louder, which means….sshh…more 15 per cent money for everyone to share. (The eagerness to shout louder grew so fast that this guy called Ogilvy actually had to remind advertisers and agencies that the consumer was not a moron; she was their wife. Joke goes thus: When poor David was old and haggard, one of the fellas from his old agency asked him in a party what he meant by that statement - what was the difference anyway?)

What per cent is your soul? Having just crossed Thomson's century, as respectable-sounding newspapers create havoc in Client minds about whether they should pay their agency 15 per cent or 5 per cent, just by writing largely superficial stories and half truths, I am very tempted to go back to the fundamental truth of Thomson's Open Contract System.

So whose agent was the advertising agency? What do you think? Feel a little shifty? Slightly queasy? Face it pal, the 15 per cent did not come from the Client, it came from the media owner. And it kept coming for close to 8 decades. That's the truth of our life. While we kept claiming we were the Client's Agency, we kept working for the Media Owner on the sly, sometimes without realising it, mostly without admitting it. Insecure to the core, but pompous nevertheless, we refused to face the fact that the folks in the big boardrooms we make our presentations to, are actually paying our salaries.

Are agencies the only ones to be blamed for this? By no means. Advertisers accepted the commission system because it was simple, conventional and comfortable. It also made them more certain of their total payout, than other alternatives. It's a shame that even now, many advertisers are quite comfortable in the percentage system, all they are trying to do under pressure, is to cut it down so that they can save money. To me it shows a certain lack of willingness to think.

This is where it gets politically incorrect. So if you are the sensitive type, please click here to go home.

Prostitutes Vs Doctors: A professor in college told us that Advertising was the second oldest profession in the world. It took me several months in the business to understand why. Do you know why? Because the prostitutes needed someone to tell the world about their service. Is it any wonder that we in advertising sometimes behave very close to the practitioners of that oldest profession? (No offence, from now I will say sex worker)..

Have you ever wondered what most of our Clients really want us to be? Consultants, like Doctors, that's what. Funny thing is most of us know it, most of us claim to be consultants, but we still behave like the other type. Here are some of my favourite examples.

How many Doctors have you met who pitched for your 'business'?

I guess if they pitched by telling you how they have cured XYZ ailment of ABC guy, we would say okay. But how would you like it if your physician drew up two equally convincing sets of prescriptions and when you asked which one you should take said, "I like both. You can run with either!" Or "My recommendation is we should run an experiment and find out which one works. Then we will know the other one was not right"?

How many Doctors do you know who expect a percentage of your chemist's bill as their remuneration?

The reason we pay our Doctors is so that she can get us fixed at the lowest cost, not so that she can play golf with the chemist.

Imagine if the chemist suddenly decided to give a higher percentage on aspirin than on digestive? What will the Doc do?

Now think about this. How many times have we recommended to a Client to pull out money from Above the Line and put in Point of Sale or Public Relations or Direct Marketing? Rarely, where is the Open Contract on all these media?

How many Doctors do you know who have readymade prescriptions that are thrown at you the moment you walk in?

Yet, how many times have we heard of campaigns with the interchangeable logos, and scripts with interchangeable brand names? How many times have we allowed Clients to fast-track a campaign out of us in two days? How many times have we agreed to create media plans without even meeting one customer?

Try telling your physician 'C'mon Doc you can do it!' or 'I have deadline to catch, hurry up on that test, will you?' and you will see what I mean.

How many specialists do you know who will guarantee you exclusivity?

Imagine your cardiologist saying 'Sir, in the 10 days that I will take operating on you, I will not see another patient nor will I offer my counsel to any'. Will you let her even think of your heart? Hell no, I won't. I want her to be so busy looking after patients such as me, before, during and after she is on to me, that I would be reassured I am not her test case.

Ditto with lawyers and management consultants.

How come we are so eager to offer exclusivity to our Clients at the drop of a Stetson? Clients want zero-conflict. That has two aspects - confidentiality and exclusivity.

Confidentiality is a valid business expectation, which encourages Clients to share sensitive information with us.

Exclusivity is something we have created in the past as a way of holding on to something that perhaps is not rightfully ours ("Please stay with me because you are the only one I have in the category, never mind what product you are getting"). I am convinced that no Client's interest is served by withholding the agency's future source of revenue. Clients would rather have a great product than a poor but exclusive one.

How many Doctors do you know who will agree to be paid in return for advising how to raise our children, in addition to writing a prescription?

Why do some of us agree to write brand plans or develop market maps for Clients free? Or do research at our cost? Value additions, did you say? Say that again?

Time to Change the Mindset: That's what I believe. It's too dangerous to be politically correct with the guys who pay our salaries. Saying yes without meaning to may mean just postponing getting sacked. Getting under the skin of Client's Business is no longer just a fun thing to do, it's now or else. Trying to cook up 'some ideas that may work for the brand' the night before the presentation is death. What we need is solid freshness and ground breaking ideas in our thinking. The times are tough folks and our Clients are paranoid about their business, trials, volumes, shares. We cannot afford to be paranoid only about our percentage.

So what do we do? I have my counsel (free to try, a million dollars to buy).

If you are in an agency…

• Refuse to treat advertising like a commodity. It's about understanding how fellow humans process information and make decisions. That's not a commodity; it's the closest you can go to Psychiatry, sitting on a chair.
• Stand up and say that you work for the Client. Media Owners are partners in delivering a product to your Clients, not the other way around. De-link your remuneration from the Client's media spend, and link it to your intellectual capital invested.
• Recommend what you believe is right, even if that may mean a lower remuneration.
• Most Clients believe there is no such thing as a free lunch, tell them you believe in it too. Do not throw away intellect free of charge. It's your Client, not your child. Allow the Client to do his / her job.

What if you are an Advertiser? Am I going to deprive you of my counsel? Naah!!!

So here goes…

• Don't throw peanuts, you know what you get when do that. Not tigers.
• Don't give your agency the status of 'commission agents' of the media owners. That's sick.
• Treat the agency and its executives like true physicians, not a chemist. If you need aspirin, you wouldn't go to a doctor, would you? Respect the agencies view, most of them know more about advertising, like you know more about your product. Your points of view may not match, but that's okay. Most of us differ with our doctor all the time, but pop in the pills anyway.
• Do not ask for free lunches (I cannot stop thinking about the time a Client told an agency, "We don't know enough about our products and who uses it and so on. You have to came back and tell us. If you don't, we will find someone who will. What was that? A noble attempt to make a virtue out of laziness? Gimme a break!)
• Never reward an agency for making you spend a lot of money. That's a commission agent masquerading as an agency. (The folks who say 'If my Client has to waste money, I'd rather he did that through me.')
• Pay for an idea and intellectual investment, that's all your agency has got. Do not create pitches, just to get free ideas. Hate to sound moralistic, but stealing really is deceit.

There we go. I have contributed more to advertisers than to agencies. Now who is going to pay me for my time? Can I see some hands please?

On a serious note, it's time for each one of us to look Truth in the eye. If we don't, some day folks may say Advertising is the World's oldest profession. That would be a really sad day.

[Published in 2001 on agencyfaqs!]