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The Evolution of the Advertising Agency posted on Thursday, 24 April 2008

Why firms must think like “business managers” versus “account executives”

By Reid Carr, President & CEO
Red Door Interactive

As a frequent attendee of local marketing association events, I am perplexed by the occurrence of regular, prevailing discussions that focus more on areas such as the best use of Google AdWords and less on aligning the campaign’s goals and metrics with that of the corporation as a whole. The days of such practices operating in silos are numbered to say the least.

The old adage is true – if you don’t know where you’re going, how will you ever get there? Good campaigns focus on developing impactful, creative and powerful messages that generate expected, desired and measurable calls to action. This is where many advertising agencies fall short; determining the success or failure of a campaign must be based upon a clearly defined set of quantifiable and relevant business objectives.

A Business Leader First, A Marketing Expert Second
In effectively measuring the value of campaigns, advertising firms must recognize that they are business managers first and marketing professionals second. Before any tactical initiatives are drafted, the account team – or what should be more appropriately called the business management team - must thoroughly understand their clients’ plan for the initiative in question, such as a product or service launch. Secondly, the agency must have a working knowledge of the established goals for their counterparts in sales, product management and other relevant areas. This is critical; only by understanding each business unit’s objectives will marketing firms be able to align programs and resources to support its goals.

Agencies need to realize that they should not be managing an “account” as they have in the past, but rather lead a business unit based on a clear set of measurable, metric-oriented expectations. Gone are the days of account executives who maintain a short-sighted eye on maximizing the agency’s revenue. Instead, advertising firms must embrace the future where they leverage readily-available data in order to be held accountable for achieving ROI-oriented results for their clients.

To do this, agencies must be aware of how their clients’ executive teams measure both success and ROI. While sales may be the most frequent answer, other aspects of the business may also be as valued, such as:

• Profit margins,
• Distribution and technology partner agreements,
• Investor interest,
• Rate of customer acquisition,
• Strategic product roadmap,
• Average sale price per customer and so on.

Advertising firms will fail to realize true success if their evaluation differs – or worst case contradicts – the criteria of the organization as a whole.

Align Your Promotion Campaigns Accordingly
With the business goals identified and understood, most advertising agencies will create tailored messaging for each audience segment they target. That’s certainly no surprise. However, many will stop at just understanding the unique communication barriers of each group and not what will get them to respond in a way that supports the established objective. For a campaign to reach its strategic goals, agencies must understand the interdependencies of each stakeholder group – such as decision makers, influencers and end users – and how their organization can solve their specific problems or needs, and how to get them engaged in the discussion.

Change For The Better
Advertising firms that embrace the need for their efforts to be measured based on their impact to a company’s business goals will realize greater client acquisition, retention and referral rates. Moreover, agencies will also find themselves spending more time in the strategic service of their organizations, and less time explaining its value. In essence, advertising firms can commit to achieving results that matter – and reap the rewards as a result.

Reid Carr is president of Red Door Interactive, a San Diego-based Internet Presence Management firm that manages clients’ online presence by analyzing their unique challenges, advising them on Internet-based solutions and implementing strategies to help them profit from their Web initiatives. Clients include Overstock.com, Cricket Communications, Rubio’s, Souplantation, TaylorMade and adidas. Find out more about Red Door Interactive at www.reddoor.biz.

Posted by John Lincoln