SAN FRANCISCO MDC Partners CEO Miles Nadal today acknowledged the harsh realities faced by holding companies and their agencies -- including the pressure to do more for clients for the same or less compensation -- but added that it's a great time to demonstrate the ability to innovate.
Nadal (pictured), speaking at the Leadership Conference of the American Association of Advertising Agencies, described advertising as an "industry under siege" that's not likely to recover until mid-2010 at the earliest.
Interviewed by Suzanne Vranica of The Wall Street Journal, he did not avoid any of the harsh realities faced by agencies and their holding companies, but he also described these as "great times" for the industry because of the level of innovation that is being required of all players.
He also noted the "chill factor" now adding to agency pain, referring to the additional strain generated by clients demanding the same level of service for stagnant or reduced fees.
Looking to the future and the shape of the industry after the recession has ended, Nadal said advertising still has not fully embraced the shift to digital communications and pointed out that agencies cannot cut their way to success. "The silos still need to be eliminated," he said.
Given that profound innovation in all areas is now essential for survival, Nadal looked forward to the future when those companies that endure will have shown themselves to be exceptional businesses. As a final pointer he said that one unchanged feature of the industry is that "clients still seek brilliant work."
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