Ad Groups Say Mars' 120-Day Payment Scheme Will 'Decimate' Industry

Well, it's about time someone stood up to this idiocy. The Association of Independent Commercial Producers and the Association of Independent Creative Editors have sent a strongly worded letter blasting Mars Inc.'s new 120-day payment policy. The AICP said the practice would "simply decimate the way the industry operates" and the AICE called the policy "patently unfair." Defending the 120-day policy, Mars spokesman Ryan Bowling said that it will be gradually put in place and with gleefully noncommittal, mealy-mouthed blather, added: "We are looking at all categories but I can't confirm what industry or what suppliers, due to confidentiality." And then with complete disregard and insanely twisted logic, Bowling added: "We look at what is mutually beneficial. That's our No. 1 priority with each supplier." Mutually beneficial? Exactly how is making a partner/suppliers wait 120 days to get paid mutually beneficial? Who in their right mind can sling this bullshit with a straight face?

So who won what in Cannes last night? Norwegian agency Anti Bergen won the Design Grand Prix Lion for its Bergen International Festival brand campaign. adam&eveDDB London won the Press Grand Prix for the Harvey Nichols "Sorry I Spent It on Myself" campaign. The agency also won the Promo & Activation Grand Prix for the same work. G-Star Raw Amsterdam and FHV BBDO Amsterdam won the Product Design Grand Prix for "Raw for the Ocean." Ogilvy Johannesburg won the Radio Grand Prix for its Lucozade "Give Me Strength" campaign. Dentsu Tokyo won a Gold Cyber Lion for Honda's "Sound of Honda." CAA won a Cyber Grand Prix for Chipotle’s "The Scarecrow." Forsman & Bodenfors Gothenburg won a Cyber Grand Prix for Volvo Trucks’ "Live Test Series." Iconoclast Paris and Pharrell Williams won a Cyber Grand Prix for "24 Hours of Happy."

McCann has announced the promotion of John Mescall to the new role of global executive creative director. Mescall is currently executive creative director of McCann Australia, a position he has held since October 2011. Mescall will relocate to New York in the coming months and join recently announced Global ECD’s James Dawson-Hollis and Bill Wright as part of McCann Worldgroup Global Creative Chairman Rob Reilly’s initiative to strengthen the agency’s creative leadership. Of the move, Reilly said: “John’s all talent and no ego and he has helped lead McCann Australia to become one of the best agencies in the world. John now has the opportunity to magnify what he does on a global stage. I am certain that John’s reputation for delivering stellar work will be a magnet for recruiting the best and brightest to McCann." A writer and creative director, Mescall has won more than 30 Cannes Lions, including 5 Grand Prix for Metro Trains “Dumb Ways to Die” and in 2014 1 Grand Prix for Creative Effectiveness for V/Line. His other awards include: Black and Yellow Pencils at D&AD, Best of Show at The One Show, and multiple Clio and Webby awards.

Jared Leto had all kinds of things to say when he was on stage with Benjamin Palmer of The barbarian Group. But when it came to advertising, he couldn't contain his excitement and offered up a bit of existentialism, saying: "I actually love advertising. I rail against it sometimes, because I don't think the world can be solved by advertising alone. I think that's a bad mission. I also think that if it's creative, it's not advertising. If it's creative, it's entertaining and informative. It's a conversation. When advertising is great, it's transcendent. It's art."

While it's no surprise that clients and agencies do not see eye to eye on many things, seeing that notion represented in a study takes on an entirely different tone. Conducted by RPA and USA Today, the study -- appropriately released during Cannes Lions this week -- found that 61% of marketers and 70% of agency executives do not share the same vision of creativity. Furthermore, just 25% of marketers believe creative work can make a dent in a brand's business, while 48% of agency executives believe creative can impact business. Most agency executives -- 75% -- say clients are too afraid to take risks, while 56% of marketers claim their agencies are more interested in selling them cool creative rather than solving business issues. And while 88% of clients believe they are open and honest with their agencies, just 36% of agency executives believe this to be the case.
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3 comments about "Ad Groups Say Mars' 120-Day Payment Scheme Will 'Decimate' Industry".
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  1. Adam Kleinberg from Traction , June 19, 2014 at 9:34 a.m.

    As an agency guy who has to deal with contracts with procurement groups, I think that the reason this guy would actually be smug about something like this, is that 120 day payment terms are not their end game. It's become very typical to get contracts from big companies that expect a 2% or even more discount when they pay bills within 10 days of receipt. When you are on Net 30, or even Net 60 terms, that kind of discount is not very palatable. We don't generally accept it when we negotiate and I suspect others do the same. That 2% seems a lot more appealing when the alternative is 120 days.

  2. Stuart Meyler from Beeby Clark + Meyler , June 19, 2014 at 10:44 a.m.

    Most clients do this. We had one large B2B conglomerate that had 120 day no penalty terms. In other words, no terms. This is anti-American and hurts the industry as a whole. Clients claim they want "innovation". How many young, entrepreneurial companies can weather 120+ payment terms. When you add in Byzantine PO processes, you aren't getting paid but twice a year in many cases.

  3. Maarten Albarda from Flock Associates (USA) , June 19, 2014 at 2:21 p.m.

    The 120 days is an awful concept which I have argued against here:http://malbarda.blogspot.com/2013/06/the-media-agency-conundrum-advertisers.html#more

  • Financial Sector To Up Digital Budgets To $10 Billion Annually By 2019

    It's not a surprise that many brands are shifting their marketing budgets away from traditional media and toward  digital media but the financial segment is set to experience big shifts over the next four years according to recent eMarketer research. 

    The researcher forecasts an 11.7% compound annual growth rate between 2014 and 2019 for the financial sector, resulting in a $10 billion annual digital ad spend. According to Kantar Media, between 2013 and 2014 alone, television spending (across all sectors) dropped 4.7% from $3.4 billion to $3.2 billion, while online spend increased 20.4% from $2.4 billion to $2.9 billion.

    Dramatic spending drops were seen in magazine (down 7.3%), radio (down 10.9%) and outdoor (down 11.4%).

    In terms of spending objectives, eMarketer forecasts that the financial sector will allocate 62% of budget (or $4.46 billion) to direct response and 38% of budget (or $2.73 billion) to branding by the end of 2015.

    Search will dominate paid media spending for the financial sector in 2015, representing $3.40 billion or 47.3% of U.S. financial services total digital ad spending. eMarketer estimates that paid digital display will closely follow, with $3.02 billion of the financial sector’s budgets projected to flow to the category by the end of the year.

    Mobile is also an active area for financial brands. According to eMarketer, mobile advertising for the sector is expected to hit $3.49 billion by the end of 2015 in comparison to $3.7 billion spent on desktop.

    Social media has also seen significant spending increases, with financial brands increasing the share of budget to 8.8% in 2015, up from 5.9% in 2014 according to Duke University's Fuqua School of Business.

     

  • SS+K Gives Middle Finger to Open Office Haters

    Recently, there's been increased debate surrounding the open office concept and its effect on productivity. Various articles and studies have pointed out that it may not be as productive a work environment as old-school offices with walls and doors. Some posit that the concept fosters the creative spirit. Others posit that the concept fosters distraction and anxiety.

    While many agencies have gone open concept, one is publicly proclaiming its love for the concept in an open letter published in Ad Age. Penned by SS+K Partner and Chief Creative Officer Bobby Hershfield, the letter reads like a "facts be damned" opinion piece which, truth be told, is perhaps all well and good. After all, what works for some, doesn't work for others.

    In the letter, Hershfield thumbs his nose at stats highlighting the downside of the open office concept and touts the concept's benefits as he sees them. He writes: “We don't rely on email so much. We talk. Email follows up a conversation instead of initiating one, or even worse, substituting for one. We don't just share ideas. We wad them up and toss them at each other, blurt them out, interrupt and criticize and applaud them. We talk more. Walk around. Offer suggestions enroute to the bathroom. We don't hide in our offices. We don't hide behind walls. We are exposed and sometimes that fear puts pressure on us to be better in every aspect of our job." 

    He finishes, writing: "We are happier. We are less complacent. Less bored. We are stimulated. And we are getting to know one another better, which makes a culture that really is only about people and [making] ideas stronger."

    There never will be an answer to this conundrum mostly because everyone has a different work style. Some love the thrill of constant interaction and lobbing ideas back and forth while eating their lunch and walking on their standing treadmill desk. Others love to cocoon themselves and let prior interactions gestate into well-formed ideas which are then shared to a larger group. To each their own, I guess.

  • Hey Agencies, Here's 5 Reasons Why Startups Should Pay You More

    David Murdico, creative director and managing partner of Supercool Creative Agency puts forth a solid argument as to why startups should pay agencies more than brands do for the same work. 

    First of all, he notes a startup is an unknown entity and no one has ever heard of it before making it all the more difficult to create the necessary marketing program to achieve awareness and sale. He notes startups are generally more demanding than established brand marketers, often times because so much is at stake.

    Perhaps the biggest problem area when it comes to crafting marketing for a startup is that up until the point the startup reached out to an agency, everything about the startup has, thus far, operated in an echo chamber with scant few nodding and bobbing their heads in agreement without truly vetting the idea or how the idea will be perceived in the real world.

    Another challenge when working with a startup? They tend to change their mind a lot about, well, everything. And that can be a gigantic time suck. Check out Murdico's entire list here and file it away in your back pocket for use the next time you consider working with a startup.

  • This Consultant Argues CMOs, Not CFOs and COOs Should Rise to the Office of CEO

    Max Brand Equity President Richard Guha says marketers should own and run businesses. He notes that many CEOs are culled from the CFO and COO ranks rather than the CMO ranks. 

    Making the argument, he writes: "If Marketing were to do its job perfectly and customers were to come and buy, there would be no need for Sales. So if only Marketing could do its job perfectly, it would be the 'go-to' function in business. Yet, companies routinely look to the CFO or Head of Operations, who do not directly contribute to the key objective of the company when it comes to choosing a CEO instead of promoting the CMO to CEO. Why?

    Why, indeed? 

    Well, he says too many marketers rely on gut feel rather than sound, scientific analysis. He notes: "Engineers can’t [rely on gut feel], or bridges would collapse, buildings crumble, and machines fail. Marketers need to think more like good engineers than mere wielders of tools."

    Do marketers lack the ability to approach brand building in the manner Guha advocates? Or is the nature of marketing and advertising too "squishy" to be crafted with exactitude akin to engineering a bridge? Is it silly to even compare the two?
  • Tumblr Blog 'Mad Men Integrated' Envisions Mad Men Characters In the Digital Age

    This is gold! Gold, I tell you! And it's arrived just in time. As we all mourn the loss of our beloved Mad Men characters, they have been given renewed life, in the form of a Tumblr blog, as digital natives spewing all the usual buzzword bingo that's so prevalent in today's marketing landscape.

    Taking on the form of animated gifs, we have Don informing his secretary: "The future of advertising is socially integrated digital platforms." We have Peggy commending a co-worker saying: "Nice branded social post, bro." We have Don asking Peggy: "But does it work as a pre-roll." We have Don reacting to a proposed "Tinder-powered drone." We have Pete telling Don: "The CTRs need optimizing for behavioral targeting of Millennials." 

    And on and on and on. Brilliance.

  • Former Y&R Exec Heads To Children's Hospital Of Chicago

    Kary McIlwain, a 26-year veteran of Y&R, is heading to Ann & Robert H. Lurie Children's Hospital of Chicago in July taking the position of vice president of marketing. Since 2002, McIlwain has been president and North American managing partner of Y&R.

    Of Mcllwain, Children's Hospital President and CEO Patrick Magoon said: "We are excited to have a marketing executive of her caliber joining Lurie Children's. With her expertise and passion, Kary is the ideal leader to oversee our marketing efforts in support of the hospital's mission."

    Under McIlwain's tenure, Y&R was named 2014 Agency of the Year by the Chicago Advertising Federation. On joining Children's Hospital, Mcllwain adds, "I am thrilled to embark on this new phase in my career, to step out of the advertising agency world into promoting a mission-driven organization. Lurie Children's is a world class hospital that deserves world class recognition." 

    Linda Wolf, former chairman and CEO of Leo Burnett Company, chairs Lurie Children's Marketing Committee and said, "I have known Kary for many years and I have watched her grow into one of the top marketing executives in the country. Her deep knowledge of the advertising world and her track record of exceptional outcomes will greatly benefit Lurie Children's, one of Chicago's beloved institutions."
  • This McCann Mad Man Says Computers Have Destroyed Creativity

    Greg Birbil worked at McCann for over 40 years. He started in 1961 and retired ten years ago. In an interview with Vulture, he relives some memories from the Mad Men era of advertising but has no kind words for the current state of things, especially the use of technology in creative departments.

    Of that inevitable development, he says, "You know, I have a whole theory: I just think computers are not good for creative people. They’re a finishing-up tool, not the instrument to help you create. It’s not because I’m an old guy -- because I don’t respect or understand the value of the computer or the internet. It’s a pencil, an extremely fast pencil."

    He continues: "But the computer guys, at a digital agency, they’ve got their heads in the screen all day and have absolutely no human skills. An art director in the old days was dealing with typesetters, photographers, the client. These guys don’t. You’re looking to make people see things in a new way, and if you’re in there looking for stuff, that won’t happen."

    Is he right?
  • Really? Seriously? Now We Have The Chief Native Officer?

    Oh for f*ck's sake! Stop. Just please stop! Every ridiculous addition to the CxO title space just dumbs down the importance of the core four: CEO, CFO, COO and CIO. Maybe you can add CMO and CCO to that list -- but chief data officer? Chief customer officer? And now...wait for it...chief native officer?

    Yeah. Chief native officer. Or at least that's what Forbes Contributor Daniel Newman would like to see instituted. Newman argues that the merging of paid and earned media requires this CxO style oversight. 

    He furthers his point, writing: "The biggest reason to get a Native Officer is that while digital agencies and publishers work together, they don’t necessarily do so as a team. In fact, there are instances where they don’t see eye to eye. While publishers are great at creating content, they can treat branded content like a 'second-class citizen.' On the other hand, digital agencies consider themselves star content creators for brands. In such circumstances, there’s a pressing need for a 'dedicated task force' to exploit native ads to their fullest potential. The CNO should lead this pack, guiding the brand towards rewarding native advertising campaigns and best practices."

    So what say you? Do we need the chief native officer?

  • Further Ignoring Productivity Studies, 'Superwide' Office Space Is Now All the Rage

    Sort of like food brands still pimping low fat/no fat products when studies clearly indicate the human body needs fat, the office management world is still pimping open office space when many studies have shown it's a less productive solution than more traditional office space.

    That's not stopping the latest trend in office space, the Superwide. Superwide office space is large, one floor office space consisting of 100,000 square feet or more. Of the trend, Brookfield Property Partners Senior VP Duncan McCuaig said: “Large floors are absolutely in demand.” And “right now there is very little of this product in the city,” he added, referring to Manhattan.

    Adam Kansler, managing director at financial data company Markit, loves the open office concept and says: “There’s something that gets lost” when a company is on multiple floors. You don’t get the same random moments of seeing someone from across the way, hearing that they’re working on a project, and saying, ‘Oh, I’m going to stop by.’ ”

    Which, for some, is exactly the problem with the open office concept; constant interruptions and annoyances from co-workers who never shut up and have nothing better to do than run a constant stream of verbal diarrhea while you're trying to complete a project. 

    But that won't stop ad agencies from continuing to pile on this trend.
  • Former JWT Director Joins Gravity As Global Strategist

    Multicultural ad agency, Gravity, has named Rodrigo Alanis global strategist for the shop, which has offices in New York, Los Angeles and Paris.

    Alanis, who is fluent in Spanish, comes to Gravity from his start-up Optimistico where he served as founder and chief executive officer. He has been with Optimistico since 2009. Prior to that, Alanis served as director at JWT Inside for nine years and traveled  across the agency's multiple offices including New York and Dallas.

    Of Alanis, Gravity CEO Yuriy Boykiv, said: “Rod is a valuable addition to the Gravity team as we expand and strengthen our competencies in consumer insights, brand planning and analytics.

    Alanis has worked on campaigns for brands such as HSBC, JetBlue, Scholastic, Harry Potter, The U.S. Department of State, and the U.S. Marines.

    Of joining the agency, Alanis said, “Joining Gravity is a unique opportunity to bring my diverse experience in brand-led business growth strategy to the team and its clients. The agency has an iconic client list, and very, very talented people. I’m thrilled to be part of this growth opportunity.”
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