Stop the Self-Loathing

For the past few years, the ad industry has been beating itself up, proclaiming its business model old-fashioned and out-of-date. As one creative director put it, “Agencies … they’re dinosaurs.”

We watched, somewhat enviously, as our clients integrated their businesses through technology, developed e-business solutions and created efficiencies through supply-chain management. Today, these clients are taking their business models to the next level, the new new thing: customer-centricity.

I had a revelation recently as I was scanning a number of business publications. A piece in the Harvard Business Review suggested the cure for “customer fatigue” is to remember that you’re developing a relationship with human beings. A headline in CIO Insight shouted, “The customer is always right.” Technology Marketing pleaded for marketing people to “stop the madness, start interviewing customers. Get to know them and their concerns well.”

Popular new business books include titles such as How Customers Think, by Gerald Zaltman, and Customers Are People: The Human Touch, by John McKean. And look at the new ad campaigns: IBM’s promise of “On demand.” Home Depot’s “You can do it. We can help.” And many others.

Businesses have gotten religion and discovered the importance of a customer-focused approach. And in that respect, I can think of no better role model for clients than one of the oldest businesses around, one that is right in their own back yard: the ad agency. No business is more “on demand,” more focused on its customers’ success or more dedicated to customer service. Just consider:

Ad agencies give their ideas away for free if it’s the right thing to do for a client’s business.

Ad agencies accept the fate of being publicly fired when their work fails to produce results.

Ad agencies recognize that the price of entry for a pitch is knowing as much about a prospective client’s business as the client does (and sometimes even more).

Ad agencies are willing to tie their compensation agreements to exceeding (not just meeting) a client’s expectations.

So, if businesses have suddenly discovered the fact that a strong customer relationship is the key to competitive advantage, here are a few lessons they might take from the ad agency:

Know your customers. Sometimes agencies understand a client’s consumers even better than the client does. They have to. Or else the work wouldn’t work.

Be accountable. If an ad campaign doesn’t work, the agency is asked to change it immediately. Failure and excuses are not an option.

Make the customer the focus of all the “silos” in the company. Creative (product development), planning (customer insights), account management (customer relations) and new business (sales and marketing) all share the same knowledge and have the same mission: to help the client.

Have a sense of urgency. There has never been a more apt description of the agency business than, “More, better, faster.”

Tie some part of performance to the ability to exceed customer expectations. Successful agencies delight and surprise clients with new ideas and new approaches. Perhaps this also explains why the agency business still boasts longer client relationships than most other industries.

A Booz Allen Hamilton survey conducted with Northwestern University’s Kellogg School of Management in 2001 indicated that companies that invest in “relational assets” (relationships with customers and suppliers, alliance partners and employees) outperform other companies financially. Trust-based, mutually satisfying long-term relationships between people have enormous value. Isn’t that what business is all about?

Maybe it’s time ad agencies started acting like the role models we are and doing what our clients do at their industry meetings: hold ourselves up proudly, beat our chests and brag about how we set a new pace for business in general.

Our time has come, so stop the self-loathing.