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The attraction of the new is universal, a

quirk of human nature which drives our

industry - drawing consumers to try the

latest product, be it the newest phone or a

low fat butter. But that which makes can also

break; staff turnover across agencies is very

high. Senior management throughout the

industry have turned their attention to this

issue to address driving forces and ways to

counteract them. There’s an inevitable

movement of workers within any industry.

The focus, however, should be on the quality

and volume of people leaving and how this

stands in comparison to industry norms. Advertising has very low barriers to exit. In the

UK most agencies are centred around a small area

in London and the South

East making a move that much easier. This is

made worse by a culture of frequent moves, due

to the young nature of the industry and the lack

of restrictions this group has.

Different people are motivated by different

things. However, there are several broad Industry

trends that inform an employee’s decision to

move. One such trend seems to be that people

within the industry make diagonal moves for the

promise of instant promotion.

This inevitably creates an environment where the

risk of moving between agencies is outweighed

by the financial gains of doing so. In turn, this

leads to wages and job titles being the driving

force for individuals when considering their

career paths.

Elliot Muscant, Managing Director of Carat

Manchester, focuses on a relevant trend in the

Industry stating, ‘there are too many agencies, with too

few offering true differentiation, meaning that price often

becomes the differentiator.’ This results in a trade off

between their desire to retain staff and maintain

current profit levels, and affects the level of wage

which can be offered across the industry. With wages

already identified as a key driver of churn, this only

serves to amplify the severity of the problem.

This inevitably creates the need for constant new

revenue streams to maintain healthy profit levels,

leading to expansion and development of new

business channels, mainly concerning advances in

technology. This creates new gaps for individuals

and departments to specialise. Agencies often feel

the need to accommodate these new developments

quickly to ensure that they are not overlooked by

clients, which is regularly done by recruiting the staff

needed rather than training up talent internally,

again contributing to increased movement within the

industry. Whilst agencies are restricted by these

industry-wide trends, there are several factors which

are still within their control.

Although wages are a prominent industry issue, it’s

not always about the money. Non-salary benefits and

a culture where employees feel valued and

appreciated are also necessary. Agencies need to

demonstrate that they are willing to invest both time

and resources in their employees for the benefit of

the individual and their future career.

From the data we collected, employees in our

industry stated that career and training opportunities

need to be more reflective of the changing media

landscape and agencies should encourage more

entrepreneurial spirit in their staff. Sumitra

Balakrishnan, Search Director at Resolution Media

states that, ‘Agencies need to provide an environment

that is challenging and creative but where learning forms

an important part of the development process.’ In doing

this, agencies will benefit in the long run as it will

lead to more confident and capable employees,

reflected in the work they do as representatives of

the agency.

In line with training and development, agencies must

ensure that employees are progressing at the right

pace. There is a misconception amongst younger

employees today that they will be able to step up the

corporate ladder quicker than their older peers. This

highlights the need for clear progression structures to

manage expectations along the career journey. Further

to this, agency employees are currently hired from

within a relatively small talent pool which makes

poaching and leaving for a small incentive an easy

and common option. Tracy De Groose, CEO of Carat

UK, addresses this problem when she says, ‘As our

business has become more diverse, now is the time to stop

chasing the same people with the same skill set... we have to

cast the net wider, and now is the time to do it.’

It is also worth considering that the industry has

changed, and therefore so must the way in which

agencies approach acquisition and churn. As John

Forsyth, Founding Partner of adam&eveDDB, states,

‘Media used to be far more commodity based and as it

didn't require such a high calibre of individual, agencies

could pay people less and it didn't matter so much if they

left. Technology has taken on a lot of the administration and

hugely improved the process, so emphasis has shifted onto

more thinking and less doing. As a consequence agencies

need to employ and pay for better people who will be

rewarded by the opportunity of having greater influence’.

Ultimately the high turnover within the industry

resides within the younger generation where there are

lower barriers to exit and increased opportunities for

progression.

‘Today, this has partly been exacerbated by a shift in

generational attitude towards the longevity of a relationship

with an employer. It is no longer the “norm” to be with a

single employer or even 2 or 3 within the lifespan of a

career.’ (Sonali Fenner - Joint Head of Account

Management, JWT)

Amidst a constantly evolving digital landscape there

is only so much that the industry and agencies can

control. Churn is inevitable within any industry and

may not necessarily be a bad thing, but it is certainly

worth considering the reasons why more people are

moving within ours.

When considering the question, it must first be

determined where exactly the value of an idea

lies: Is it the brand’s value that’s the key factor, or

the client’s ROI, and quite simply, can these be

measured?

A brilliant idea might not be that brilliant if it

cannot be monetized for your client’s business.

From studies and industry opinion, the value of

an idea for a business can be attributed to

tangible return on investment (ROI), or the less

concrete metric of improving brand value.

When looking at ROI, studies by Zéghal and

Maaloul (2010) introduced the Value Added

Intellectual Capital (VAIC) model, which shows

that when attributing value to an idea, you need

to understand the value it adds to products and

services, above the costs to produce them.

This idea of adding value to ROI is supported by

industry leaders. Richard Sexton (COO, Carat)

argues, ‘Nowadays it’s about consultancy where we

can add value to our clients’ business. Value is about

creating a demonstrable link between media

investment versus output through improving margins,

profitability or whatever that clients business might

be.’

However, ideas can also be assessed through the

impact they have on long-term brand value,

which is more abstract and more challenging to

accurately measure (Staff survey, Zenith

Optimedia). Other dimensions of value are

creativity and innovation: ‘Many agencies lose

business simply because the client looks at their work

and decides, you’ve stopped inspiring us.... most

importantly [clients] should feel invigorated

and directed’ (Oli Newton, SMG) as well as

scalability: ‘the value of an idea is how far it

travels...how many people are going to share that idea,

and how will this grow exponentially.’ (Richard Morris,

Managing Director, Vizeum)

To assign value to an idea, there needs to be

justification of that value, which is closely linked to

the metrics which an idea is judged against. One of

the main attributes of the digital arena is its ability

to provide proof. Everything is measurable. Once

implemented, an idea can be tracked from

origination to completion. In the words of Dave

Wallace, CTO of JWT, “With digital campaigns, it can

feel like there is nowhere to hide”. He also refers to the

fact that “[digital] campaigns should be able to respond

to feedback and optimise accordingly,” a further

example of how proof, such as consumer

interactions, can impact on ideas.

In this sense, we cannot predict the course of a

digital idea, as Sonali Fenner, Joint Head of Account

Management of JWT explains, “Sometimes an idea

surprises you in the way consumers interact with it,

develop it and share it (Think Old Spice). And the beauty

(and the danger) of digital channels is how well you as a

brand are able to both react and preserve the integrity of

the original idea whilst allowing it space to evolve”.

We are asking our clients to take risks in projects

where the value of an idea and how it develops,

cannot be guaranteed. There are several in the

industry who think that sharing risk with clients,

and moving towards an IP-based revenue model, is

the way forward. As Jon Sharpe, Head of

Innovations at RKCR, explains: “We haven’t jumped

with our clients and put our money where our mouth is

and actually taken the risks...and I think that is

problematic in an industry where we claim to be valued

business partners; what most advertising agencies do

currently is charge for the time it took them to develop an

idea but they don’t actually benefit economically if that

idea is hugely successful and transformative for their

client.”

This is in contrast with Adam Whitaker, Creative

at AMVBBDO, who cited several new start-up

agencies who used this model, but were not able

to afford to pay their staff. For him, the risk and

inherent complexity of trying to put financial

value on an idea before you’ve even had it, makes

agencies too vulnerable. As an alternative, he and

strategist Martin Beverley discussed IP-based

revenue as an additional layer to paying agencies

for their time.

Whilst the risks that the digital landscape

represents, for agencies and clients, are manifold,

it also offers many new opportunities. New

technologies allow us to take a more iterative

approach to campaign planning, enabling us to

take many smaller risks, testing and learning

from a campaign as it happens, and altering the

path a campaign will take according to how it is

performing. In this sense, the digital landscape

highlights some of the industry’s most pressing

issues: the opportunity to continually prove

worth to clients through data, whilst

simultaneously asking them to take the risk to

support unproven ideas.

To summarize, specific value measurement of an

entity as abstract as an ‘idea’ remains complex,

regardless of the channel involved or whether the

measurement pertains to brand value or short

term KPIs.

Within the agencies that were interviewed, the

consensus was that the value of a concept

depends not on the channels used, but, as

Andrew Blake maintains “ what it does for the

client’s business, how it shifts perceptions and how it

shifts sales.”

To understand the question at hand, it is important to

define what is meant by value. In this context, value

could describe the acquisition of brand advocates,

ambassadors, conversationalists or even potential for

income by creating customers or awareness. Although

it is sometimes difficult to work out the revenue

generated by a social media campaign, there is a clear

distinction between rewards generated by actively

engaged fans and followers, the most valuable

customers of a brand, and those with little or no

participation with a brand. This view has evolved over

time, with brands now beginning to question the

meaning of Likes, or even the value of having a

Facebook presence at all.

Facebook, for many brands, is seen as a forum for open

communication and relationship-building, but sceptics

believe these conversations to be artificial and

worthless. Many see a Like on Facebook as an

invitation to join a conversation with consumers,

however the value of this conversation will be

hugely dependent on the content of what is said, its

relevancy and how it will be spread amongst others.

“What matters is driving the right recruitment. If this is

not achieved, then fans are a waste of an opportunity”.

Angus Wood, Director of Paid Social, Iprospect.

According to a recent study by Social Bakers,

Facebook is now reaching 1 billion monthly active

users per month and news feeds are becoming more

crowded with content that wants to be seen and

interacted with. To win your place in the newsfeed

spotlight, a brand has to publish interesting material,

with an emphasis on quality over quantity.

Facebook has a maximum reach of any piece of

content to 16% of fans, and this can only be

improved on if the content is interacted with.

Thus, only engaging and compelling content can

reach a wide range of fans and will result in

added value. The number of Facebook Likes only

has any relevance if actively interacted with.

“Half a million people who regularly reply and respond

to brand content such as comments, engagement,

retweets, follows and replies holds more value than

10m people who hold no connection or intrigue into

your brand.” Oli Newton, Head of Strategic

Partnerships at SMG

There is a growing train of thought that the value

of a large fanbase has been misconstrued. It may

be seen that, despite there being a core audience

of valuable engaged fans, most of the brand-

following within social media is superficial and

opportunistic. These people believe that what

motivates consumers to “friend” brands is a

promotional mechanic to hook people which does

not automatically mean they are brand advocates.

As such, the brand’s focus within social media

should be on its existing real-world customer

audience.

“10m Facebook fans is analogous to a Russian Doll in

that there are distinguishable layers within it. You

have the core fanatics at the very heart of the brand,

and then the ‘tag alongs’ that exist in the outer layers”.

Pedro Avery –MD Arena Media

This is illustrated by Napkin Labs research which

analysed fan engagement for over 50 brand pages,

from consumer electronics companies to retailers,

with between 200,000 to 1 million fans each. As

mentioned the key engagement driver on a

brand’s page

seems to be the core group of devoted fans which

Napkin Labs refers to as “superfans.”

The study found that, on average, the

engagement of each one of a brand’s 20 most

engaged fans is equivalent to 75 average fans.

Each month, the so-called superfan likes 10 posts,

shares five pieces of content and comments once.

The importance is that these fans tend to receive

significantly more likes and comments on their

posts than average fans, which in turn helps drive

engagement on the brand’s page.

“The strength of social is ultimately tied to the

strength of the brand. There are obviously exceptions,

but really, if the brand doesn’t engage an audience,

then Facebook won’t help. It’s really just a brand

extension” (Hal Stoke - Head of Social - Essence)

We can see that there are many different views

that exist surrounding the value of Facebook fans,

whether it be 1 or 10 million. However, a

recurring theme that has emerged, is that the

quality of the fans and the amount they engage

with a brand, is much more relevant than the

number of them. Moreover, to maximise the

value, it must be a two way street with brands

providing relevant and current content to fans. To

convert this to monetary value, brands must

strike the balance between raising awareness and

actively incentivising sales. Until the acquisition

of a Like equates to accurate monetary value, the

lack of clear ROI’s within social media will attract

scepticism. However, few would argue against

the value of obtaining engaged brand

ambassadors and advocates.

“If they are passing on your brand messages to their

friends and influencing people, then that is an earned

communication that is adding value and building your

brand but brand value is notoriously difficult to

measure.” (Jerry Bulhmann - CEO Aegis Media)

In the past there has been ‘a misconception that data

opposes creativity’ with ‘the old argument that intuition

is an inventive force that should not be constrained by

what the dry numbers seem to suggest’ (Simon

Richings, Digital Creative Director, Tribal). In

reality, data has always been used in some way to

inform the creative process. However, thanks to

technological advancements, and the quantity,

range and speed at which data has become

available, its use has changed, leading to the rise of

‘big data’.

Traditionally, data has been used at the outset of

the creative process, as it ‘reinforces the authenticity of

an insight so there is greater conviction in finding the

right idea’ (Jon Forsyth,

Founding Partner, adam&eve DDB), as well as

post-campaign to evaluate effectiveness.

However, a key development is that data can

now be used in real-time, making its input crucial

across a whole campaign. It can assist in the

development of ideas, the targeting of an

audience and more effective positioning of work

across media channels, enabling for live

optimisation mid-campaign, to contributing

learnings from post-campaign analysis which can

help identify new creative ideas resulting from

the work. To think of the process as a ‘virtuous

cycle’ means we can access how data plays a part

and at which points.

For the first step of the creative process,

the development of the creative idea, data is an

increasingly useful tool that can lead to an insight

but it cannot provide the idea itself - a creative

leap is needed beyond the insight to get to this

idea. As marketing is a discipline based on the

need to create preference for new products and

audiences, creative ideas for clients must contain

new and interesting content to present to

consumers, which cannot be achieved with data

alone. ‘Data in itself can only inform about stated

preference, about pre-existent consumer behaviours

and therefore it needs new ideas and new ways of

thinking to make it relevant and interesting’ (Ian

Pearman- CEO, AMV BBDO). Data has a clear

role at this stage in the creative process but

cannot alone create something interesting for a

potential consumer.

When we move on to creative implementation

and deciding what media channels will be

appropriate, data is essential to define and target

an audience, as well as to show why they would

be receptive to the creative on a given platform.

Users are targeted depending on their attitudes

and behaviours, so it is essential that the creative

is displayed in the appropriate and most effective

destination. The placement of creative relies

wholly on the data that is collated surrounding

audience insight. Therefore it is essential that all

data used in the audience analysis is timely,

concise and relevant to allow for accurate

assumptions to be made. Online behaviours are

constantly changing and therefore real-time data

is imperative to ensure that consumer’s ever

changing needs and behaviours are measured

and considered to

guarantee the creative process remains both

relevant and effective.

When a campaign is live, real-time data can be

extremely influential, both in terms of creative

content and media. Creative copy and ad

placement can be optimised using live

performance analysis as it can provide insights

into audience response, making for a better and

more informed experience for the consumer. In

an ever-changing media landscape agility is

crucial; agencies need to make small, incremental

changes throughout a campaign, fuelled by data

insights.

Finally, it is imperative data is analysed at the

end of each campaign to identify key learnings

which will shape future activity. Data in post-

campaign reviews should be treated as an

opportunity for both creative and media agencies

to work together to determine key insights. These

insights should form the foundation to the

planning process for future campaigns, whilst

also providing agencies with an ideal opportunity

to work even more collaboratively moving

forwards.

In conclusion, when it comes to a creative idea,

data is a key tool in leading us to the right

solution but it cannot provide the idea itself due

to the need for marketing, and thereby

advertising, to constantly innovate and disrupt. It

can show us something right, but it can’t, in itself,

be an interesting creative idea, and ‘there is a big

difference in being right and being interesting’

(Martin Beverly, AMV BBDO).

This question can be approached in two ways. Firstly,

whether hierarchy in agencies will be disrupted by

the need to have specialist knowledge of emerging

technologies, and secondly, the way in which

technology potentially changes how agencies work

internally.

There have always been technological advancements

and so far that hasn’t had a great impact on the

traditional hierarchical structure within agencies

because what you need from a leader doesn’t change.

Whilst it is essential that there are teams within the

agency that understand the latest technologies and

how to use them, it is more important for leaders to

understand the bigger picture: how the industry

works and how to manage these specialists

effectively. “Digital technology is not at the heart of ad

agencies, consumer behaviour is at the heart of agencies.”

(Rohan Tambyrajah, Digital Innovations Director,

Arena Media). Being able to run a business well is not

just about understanding technology but about

experience.

Agencies have started to acknowledge the need to

have insight from junior employees who have grown

up with mobile and tablet devices in their hands.

Whilst the conventional structure is still in place, it’s

less rigid and more open than seen previously.

However, it would be risky to assume that just

because junior people within an agency may be

‘digital natives’ they will be able to deliver more

effective digital campaigns. ‘Consumption and craft are

completely different things.’ (Jon Sharpe, Head of

Innovations, RKCR/Y&R)

The younger generation are embracing advances in

technology and know how to utilise it. This provides

the opportunity to create a point of difference that

sets them out from other employees within an agency.

‘Some parts of technology didn't even exist two years

ago...we will find that people are in positions that didn't

exist earlier.’ (Dan Friel, Managing Partner, MEC).

However, it is a common misconception that all

senior people within agencies don’t want to embrace

new technologies. Most do, but the priority is running

a successful agency. Business leaders can always hire

people who have the knowledge that they themselves

don’t.

In fact, it is up to senior management within an

agency to cut through complicated technological

details and turn them into simple and effective ideas

that clients can understand.

As digital becomes even more integrated into our day

to day lives, it is inevitable that agencies will have to

develop new skills and understanding. Eventually the

current junior members of agencies will be leading

them, but then there will be further new technologies

to understand. This doesn’t mean that hierarchy will

or should cease to exist. In fact, junior levels may

resist that as much as senior ones. A flatter structure

would remove the satisfaction of ambitious

individuals who want to work upwards in their

career. They may measure and define their success by

progressing upwards as a part of this hierarchy.

There is a stronger argument that technology will

affect the operations of an agency, rather than its

structure. Considering technology in its most literal

form, it provides a space for more transparent and

accessible communication. Social media is one of the

key aspects of this, as it is an attribute giving

opportunities for interaction between all levels within

the industry. As boundaries are removed, it is easier

for people to build sustainable networks that provide

the opportunity for education and to build a

professional profile. This can be beneficial for creating

a network both within an individual agency and the

industry as a whole.

‘Technology as an enabler also takes away the “commander

control” aspect, as people on all rungs of the structure can

work collaboratively on one thing’, (Pedro Avery,

Managing Director Arena Media). Integrating

technology into the way agencies work is important

to drive efficiency, and using it to its full potential can

provide quicker, smoother, more integrated work.

The nature of technology provides transparency

which enables accountability and responsibility

between people within an organisation. This aids the

way hierarchies work, as it provides a greater

understanding of the strengths of individuals.

The hierarchy of agencies won’t be forced to change,

but those that use technology to work more

collaboratively will benefit through greater levels of

knowledge sharing.

The concept of bravery and how it relates to risk

depends on the client. Bravery should grow

organically from a close relationship and a shared

understanding that innovation is crucial to any

client’s business.

There is no universal rule of how brave clients

should be or even what bravery means. The

agency’s role, according to Jenny Zirinsky, Head

of Digital at OMD International, is to know the

client’s tolerance to risk and push it appropriately

whilst being sensitive to balancing risk-taking

with the client’s business needs and structure.

Andrew Blakeley, Social Strategist from

Adam&EveDDB, emphasises the importance of

understanding the culture of your client’s

business: Is there room for creative scope? How

risk averse are they? What internal incentives are

there for experimentation? Having a better

understanding of this will enable the client to be

confident when being held accountable

internally. Being aware of what competitors are

doing can also demonstrate to the client the need

for bravery.

“If you don’t go for it, your competitors will, and you

will be left behind.” Alex Smith, Digital Client

Director at Maxus

It is crucial to have a balanced client relationship;

it is better for agencies to work with clients rather

than for them. The key is to develop a

collaborative relationship with openness and

trust that allows the free exchange of ideas.

Involving the client from an idea’s infancy in a

co-creation process ensures shared ownership of

the proposition. This lets agencies be transparent

with clients about the potential risks and

rewards. Ultimately, a stronger relationship

means that both agency and client better

understand how to balance risk-taking and

innovation with tried and tested approaches.

With this closer relationship agencies will be in a

position to better inform their client’s media

budget. It has always been important to allocate

some of a media budget to innovation, but in an

economic climate that encourages conservatism,

the importance of experimentation has never

been greater. Industry consensus points to some

variety of the 80/20 budget split, with the

majority reserved for strategies we know work

(and which can be clearly measured by ROI), and

the rest allocated to riskier strategies with less

predictable results.

The data explosion means that testing and

learning has never been so valuable. The message

from across the industry is that this data can

inform campaign creation and optimisation - and

that if we don’t encourage clients to take

measured risks with their marketing then our

competitors definitely will. It is easy to look

immediately to ROI, but with the proliferation of

new media channels there will always be an

element of risk.

Nishma Robb, CCO of iProspect, advises: “We

need to promote the idea of failing fast and encourage

clients to do this in a controlled way: test, try, and re-

deploy quickly and if successful feeding back to the

client. This gives the client security about what they

can achieve.”

We need to work with clients on a definition of

long-term success, and shift the focus away from

immediate changes to their bottom line.

Of course if agencies want to encourage clients to

be brave, they must be prepared to show that

they have delivered: ‘It’s all about the goals,

objectives and KPIs of the client’ - Mark Fagan,

Head of Search and Performance Media,

iProspect. We need to support our campaigns

with hard metrics and measurements and ensure

both parties understand what success looks like.

Bravery should grow organically from a close

relationship with the client and a shared

understanding that innovation is crucial to any

client’s business. As Jon Forsyth of

Adam&EveDDB says, ‘Agencies need to push for

getting the criteria for success clearly defined up front

and agreed internally, so bravery is not an

experiment.’

The need for balance between encouraging clients

to be brave and meeting their expectations is not

new. Digital hasn’t changed how important it is

to understand their client’s culture, to foster an

open and honest partnership, and be prepared to

advise on measured risk.