Advertisers should look beyond prizes when evaluating agencies
The advertising world is starting to make professional boxing look organized. As if a dozen awards ceremonies that honor everything from creativity, graphic design to interactive advertising were not enough, this year, three publications gave out "Agency of the Year" prizes.
Competition among those giving the awards is getting more interesting than who actually wins. In the past five weeks, Strategy, The National Post and Marketing Magazine announced their agency of the year choices. The first two - who publicly exchanged barbs about each other's selection process - ended up choosing Palmer Jarvis DDB. The latter chose Publicis Canada.
Agency of the Year awards, are popular, because they give the industry a chance to talk about its favorite subject: itself. They also give winners exposure, that hopefully, will translate into new clients.
For Palmer Jarvis, whose star creative director Chris Staples left last year to start his own agency, its victory has been likened to that of the Edmonton Oilers coming back to win the Stanley Cup without Wayne Gretzky.
For Publicis Canada, Quebec's second largest agency -- which won Marketing Magazine's award on the strength of its pickup of the Microsoft Canada and the CIBC's advertising accounts - the win signals its arrival as a cross-Canada player.
But as useful as they are in promoting the industry, awards
don't tell prospective clients a heck of a lot about how these
agencies performed for their existing clients. Nor are they
predictors of how agencies will perform in the future.
Another high profile agency, BensimonoByrne D'Arcy, which produced this year's most talked about and arguably most successful ad - Molson Canadian's "Rant" could not build on that success.
And Publicis Canada won its agency of the year award largely based on the fact that it won contracts and hired key executives. It's a promising start, but moves generates few, if any immediate results for existing clients.
Although winning a lot of prizes means something, the bottom line is that when evaluating ad agencies, advertisers need to look beyond their trophy cases.
But it's not that easy. One problem making it hard to evaluate agencies, is that lot of their best ideas never see the light of day. That's because big advertisers like governments, automotive manufacturers and the big banks simply won't run any ad that is in the least bit controversial - the kinds of ads that do well in these competitions. These ad ideas are thus filtered out in the testing process.
Another problem with putting too much credence in an agency that wins a lot of prizes, is that there is very little hard evidence that award-winning ads actually boost profits.
True, many advertisers can link award-winning ads with increased sales. But this link does not necessarily translate into profits. That's because many such ads are also backed by big media budgets. This leaves it an open question whether the extra sales are due to the ad's quality, or to the fact that it's being run over and over on several many stations.
In fact, even if sales go up as the result of an advertising campaign, if they go up less than the production and media costs, the company running the ads could actually lose money. The point is that without company sales and profitability data, it's impossible for an observer to know whether an ad campaign worked or not. The only ones who know are the advertisers.
That's why a good clue as to whether an ad agency is performing or not, is to watch whether its client's ad budgets are rising, or whether it is assigning new mandates.
For example the fact that McDonalds Canada is broadening its relationship with Cossette - its long-time Quebec agency of record - to encompass advertising across the country, speaks louder than a dozen advertising awards.
By its very nature, an agency of the year competition implies that the agencies have significant control over the advertising process, a point which is at best, highly debatable.
In fact, it's the advertisers - who write the checks, and authorize the ads that run -- that hold all the cards. Ad agencies that perform best, are those that anticipate and deliver ideas that their clients want. That sometimes translates into awards. But not always.
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