Agencies Deserve A Break Today. The Ugly Part of the Ad Biz.

agencyIn my youth I worked at Needham Harper & Steers (1976-1977) and BBDO (1977-1989) in their respective New York offices. Later in my career I was the leader of two different Philadelphia area ad agencies.

It’s been 17 years since I created my consulting business, and obviously the communications industry has changed dramatically. However, one thing that hasn’t changed is the scapegoating of agencies by some clients looking to blame the agency for the weak sales of their inferior product. God knows many agencies deserve to get fired for lousy work and/or lousy service. I am not afraid to admit there were times in my past that my agencies deserved (and got) the boot. But it turns my stomach to see agencies that do good work get blamed for an inferior product by the CMO du jour.

My first job in the business was at Needham Harper & Steers in their New York office. Ad historians know that Needham Harper & Steers combined with DDB as part of the “Big Bang” formation of Omnicom in the spring of 1986. The Needham part of DDB Needham was ultimately dropped. I worked in the NY office as an AE on the Amtrak account, a terrific learning experience. In retrospect those were my happiest years in the business. Some of it was the shear excitement of the industry in that era and obviously it was the first time around the block for me. But Needham Harper & Steers was a terrific agency that valued the power of ideas both in New York and in its larger Chicago office where we handled the McDonald’s account. I remember the pride I felt viewing a teleconference (a big deal technologically at that time) and watching Keith Reinhard show us the new McDonald’s campaign, “You Deserve a Break Today”. I had nothing to do with the McDonald’s account and it wasn’t even in my office, but nonetheless I was proud that my agency did this great work. Ironically Needham would go on to lose the account but win it back, and handled it along with Leo Burnett, another great agency for many years.

mcdonalds-logoFast forward to today, both DDB and Leo Burnett are now in review with the recent announcement of the review of the McDonald’s business. I may not be an expert on every part of the McDonald’s business, but this I know for sure– McDonald’s food is largely crap. And yes I eat it myself on occasion, but it is dreck. And the American public knows McDonald’s serves crap, and is a leading player in contributing to growing American obesity (Yes, I am a member of the club too). Enter the “new CMO” Deborah Wahl who joined the company from home builder, PulteGroup, 2 years ago. Deborah, if Pulte built homes with faulty construction, would you have blamed your ad agency?

Be that as it may, the dance has begun and the incumbents DDB (Omnicom) and Leo Burnett (Publicis) are “invited to participate”, along with the other mega holding companies. Let me understand this, McDonald’s couldn’t get great work from 2 long time great agencies so it needs to satisfy its corporate ego by asking the industry’s largest holding companies to compete? I don’t buy it. The size and marquis value of the account is such that all invited will no doubt compete.

Maybe the incumbents will retain the business, but more likely one or both will be toast. What’s even more likely is the small one liner in 2018 in the press that McDonald’s is looking for a new CMO while Ms. Wahl is “seeking new opportunities” having fired a great agency or two in her wake.

And unless McDonald’s dramatically improves its food quality, then merely being able to get an Egg McMuffin at 4pm won’t change its plight. And the next ad agency will suffer the same fate by the next CMO. That’s the part of the ad business I don’t miss at all.

Additional note: Check out the latest 5/23/16 in terms of McDonald’s view of agency compensation. Another reason I will stop eating there (in addition to their lousy food).

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