At 4A's, A Show Of Strength With Talk Of Compensation

Recruiting talent, creating a more diverse workforce and reconnecting with media planners were among the key issues at the American Association of Advertising Agencies' 87th annual management conference last week. None were particularly new, but attendees seemed happy getting back to basics after several years in survival mode. Armed with a renewed sense of confidence and value, they also revisited the persistent topic of compensation and getting paid more fairly. In his opening address to the 380 attendees (up from last year's 330), 4A's chairman Ron Berger quoted Benjamin Franklin's personal motto—"Annuit coeptis. Be favorable to bold enterprises"—to illustrate that "if you want to make a buck, you are going to have to take some risks." Andy Berlin, CEO of WPP Group's Berlin Cameron/Red Cell, urged agencies Friday to demand more pay for work that drives sales. Agencies and clients should establish a fee structure in which they share not only production and media costs but also financial rewards for moving product, Berlin said. "Clients live and die by what we do," he said, yet under the most common of today's deals, "bad advertising and good advertising are compensated exactly the same way." If fair practices aren't implemented soon, "the big risk is that we're not going to have an industry," he said. Nina DiSesa, chairman of Interpublic Group's McCann Erickson, New York, said the 4A's should lead the charge with clients. "Right now, we're selling time," she said of the way shops are paid. "But we really sell ideas. The whole idea of timesheets is archaic. What happens if you have an idea in the shower? ... We need to have the money to take care of talented people."Some embraced the philosophy but questioned how to put it into practice. Glenn Hollis, managing director of WPP's JWT in Toronto, told Adweek, "As a suit, how do I meet those metrics? We all have shareholder needs to meet. How do you say to a client, 'We won't do that'? " Susan Gianinno, North America CEO of Publicis, said Berlin's idea is "old news for people involved in the 4A's. We've been working on it for years." She said Procter & Gamble's Jim Stengel has already implemented a system in which agency compensation is tied to product sales. During a speech Thursday, 4A's CEO Burtch Drake cited efforts such as a joint task force with the ANA, a "real usable metrics" initiative and ongoing seminars featuring economists and industry leaders. "There's a lot of stuff in the works, and I think it's going to bear fruit," he said. The return of compensation as a topic marks progress even since last year's conference. Then, the focus was on regaining pride and marketing the industry better; now, it's on growth opportunities. "There's a lot of [new-business] activity out there, and I think that's helping," said Chris Shumaker, director of development for North America at Grey in New York. "This is the first year more people are looking to the future instead of dragging their heels," said WestWayne CEO Jeff Johnson. "I think it's a watershed year."

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At 4A's, A Show Of Strength With Talk Of Compensation

Jim Lovel

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Jim Lovel