Why don’t many ad agencies advertise?

Posted on December 19, 2007 
Filed Under Ad Agency, Advertising

Here is an excerpt of a very interesting article by SinekPartners CEO, Simon Sinek. The article talks about how a traditional ad agency operates when it comes to advertising its own message. I am sure once businesses understand “Do as I say and not as I do” mentality of many ad agencies, they will do their homework to find the agencies that truly care about their needs.

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An excerpt

IF ADVERTISING is so effective, why don’t ad agencies advertise? PR firms tout themselves in releases. Event planners throw their own parties. E-marketers use the Internet. These folks all believe in the effectiveness of their disciplines. Do ad agencies disagree?

In an increasingly cynical age of advertising and mass marketing, modern ad agencies work hard to reinforce the value of their product with their clients. “Studies” are whipped up to prove the effectiveness of the medium. And when client budgets are tight, agencies will provide data to show the importance of advertising in a down market. But this “do as I say, not as I do” mentality raises a suspicious eyebrow.

More than advertising, agencies rely quite heavily on pr. Getting mentioned or singled out in Brandweek, Adweek and other prominent newspapers and magazines supports an agency’s ability to drum up business.

When Donny Deutsch took over leadership of the agency his father started, he tried to drive new business with a full page ad in the New York Times. The ad was ineffective at helping Deutsch attract clients. Deutsch abandoned his own product and hired high-priced pr mavens at Rubenstein Associates to raise his profile. And it worked.

In their own defense, agencies may point out that they operate in a business-to-business environment and their product is more effective in a business-to-consumer landscape. But the argument holds no weight because agencies routinely pitch and promote the value of ads to b-to-b clients, too.

If agencies hype the importance of branding campaigns for public companies to enhance their image among investors, why is it that Interpublic, Omnicom, Publicis and WPP don’t support their brand images on Wall Street?

According to Nielsen Monitor-Plus, the four holding companies spent a total of $3.7 million to promote themselves in the U.S. in 2005, down 15% from the $4.4 million they spent in 2004.

Considering that agencies recommend their clients spend 10% of their revenues on marketing, the big four are spending .01% of their combined $29.3 billion in global revenue. Mull that for a second or two.

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Comments

3 Responses to “Why don’t many ad agencies advertise?”

  1. http://blogcarnivals.blogspot.com on December 27th, 2007 9:27 pm

    I have featured your blog..good luck. If you can find the time to technorati fave us that would be great. BC

  2. admin on January 6th, 2008 5:02 am

    Thanks for the post on your blog!

  3. Microbrand Monday: Little as a Strength « polygraph approved on February 4th, 2008 9:09 am

    […] Microbrands, Free Agent Nations, User-Generated Content are re-shaping the way we do business — even in advertising. Need proof? See this link that’s even truer today on ad agencies shunning advertising of their own brands. […]

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