Credit: Photo by Nathan Skid

How Adland Is Replacing Steady Stream of Talent Leaving for Greener Pastures

With In-Demand Workers Being Plucked, Agencies Struggle to Reseed

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WANTED: Permanent employee for hot San Francisco agency. Tenure: Six months.

This trial-basis employment model being considered by two-year-old creative shop Argonaut is one of many innovative approaches agencies are turning to in the hunt to attract the best and brightest. In today's digital-first world, agencies are no longer competing just among themselves, but against the Silicon Valley-size salary, stock options and benefits dangled by tech giants like LinkedIn and Amazon. Lacking the financial lure of an IPO that startups offer, Madison Avenue is doing a lot more creative thinking when it comes to employment.

Argonaut hopes its approach will resonate with talent wary of committing long-term to the first opportunity. "The more I talk to recruiters and candidates, they seem to be open to a trial basis," said Maura Menapace, head of talent at Argonaut. "Everyone is thinking, 'All this stuff is trial and error, so let's try something new out.'"

"Experimentation" is the watchword among the media, digital and creative agencies scrapping over the limited pool of digitally inclined talent. Some are scooping up sought-after staff by hiring before there are even jobs for them. (R/GA has set aside a $1 million fund to hire entry-level talent ahead of need, particularly for promising grads out of portfolio schools like VCU Brandcenter.) Others promise programs for entrepreneurial endeavors or merge with sibling agencies to offer a wider range of services -- and employee experiences.

Whatever their solution, agencies are all trying to answer the same problem: How do we attract the best talent and keep it while maintaining margins?

More than salary
Shops like New York City's Firstborn offer competitive salaries, but there's a limit to what they can pay. So Firstborn CEO Dan LaCivita touts opportunity over base salary. "There's not an endless amount of money to pay 20% more because we might need them." The ploy is, come in and help build a team.

Helping to build that team is Firstborn's internal development director Brett Swanson. He started as an intern, was hired full time as a 3-D artist and later tapped for the new recruitment role because, Mr. LaCivita said, it made sense for someone who understands digital marketing to do the hiring.

Through Mr. Swanson, the shop last year hired 20 people. Recruiters typically charge $15,000 to $20,000 per hire, said Mr. LaCivita. Previously, the shop mostly relied on recruiters, but now only uses them occasionally.

The shop also offers $4,000 referral rewards, and Mr. LaCivita speaks at universities hoping to scout young talent.

Then there's the oldest recruitment tactic of all: working connections. David Shulman, CEO of Omnicom's Organic, and his staffers often tap into their personal networks for hires, specifically those who "need to think through the customer journey and understand user experience and have a good idea and be able to code that idea," he said. Three-fourths of Organic's hires this year had a link to a personal connection.

Carat Global President Doug Ray found his head of strategy through a friend of a friend after nine months of interviewing candidates. There was just one catch: He had to first convince Justine Bloome to relocate to New York from Australia. "We need fresh thinking because of how content is fundamentally changing, and things happening around programmatic," he said. "We do have to go outside the industry, or at least outside of New York."

Creative shops like 72andSunny, KBS and Anomaly tempt recruits with the promise of entrepreneurial endeavors and working on projects that have the potential to create real intellectual property, like products and content.

CEO John Boiler of 72andSunny said the agency emphasizes culture when pitching candidates being courted by tech companies. "You can go work for a company for stock options, but we are trying to create a place with a higher mission: We have a culture of collaboration, and we've doubled down on training programs. You're not just put into the talent pool here without a growth plan."

For creative agencies, hiring employees with broad skill sets is critical to competing with digital-first shops like R/GA. Mr. Boiler said 72andSunny trains its employees "to think outside your function." He said the broad opportunities at 72andSunny often don't exist in the more siloed environments at tech companies.

Reframing the position
Deutsch is playing with new employment models that aren't quite internships, but also aren't permanent jobs. Deutsch's North America CEO, Michael Sheldon, said the program, called D Prep, was started last year to staff up digital employees. "It's an area where it still can be tougher to hire in," said Mr. Sheldon. "Those skills are so much more varied than [those of] a general advertising person." Last year Deutsch recruited 12 junior staffers on a trial basis, but only two worked out.

The sell is somewhat different at media agencies, which have spent the past few years automating previously labor-intensive back-end planning and reporting functions that support buying. The amount of media dollars that go through automated programmatic buying systems is increasing, but machines aren't replacing people just yet. As such, there is a crying need for high-quality data and analytics as agency frenemies Google, Facebook and Twitter poach talent with that expertise.

"We wanted to minimize more rudimentary jobs and replace those with what tech could have been doing and then redeploy around content," said Matt Seiler, global CEO of Interpublic's Mediabrands.
For media agencies, the dynamic might mean shifting employees around rather than hiring new ones. "We move from reporting data to interrogating that data and deriving insights on it. Either we're making some of those [reporting] individuals redundant or training them up to do different jobs," said Carat's Mr. Ray.

Embracing junior talent
The talent crunch has upended the top-down model at agencies. What was once a competition for talent in senior ranks, particularly creative, between agencies and tech companies has evolved into a race for junior talent, even those fresh out of portfolio school. LinkedIn often scouts talent from Carnegie Mellon, while Apple heads to VCU Brandcenter's portfolio review for fresh blood, noted GSD&M recruiter Shannon Moorman, in part because those schools now incorporate user-experience design into the curriculum.

"I'm finding that the entry-level positions are attractive to a higher caliber of highly educated people," said Mr. Seiler, thanks to all the data media agencies collect and analyze that's important to the business. With the automation of menial tasks, there are also more "meaty things to do" for junior staffers early on, he said.

The red-hot demand for good portfolio-school candidates is what led R/GA to set up its $1 million fund to immediately go after potential hires. Out of more than 90 VCU graduates, R/GA last year interviewed 25 candidates and hired six -- four of whom it had identified as chief targets on previous school visits.
Among them was Katie Long, a planner who had her formal interview on a Thursday; the hiring process began the following Tuesday. "I never questioned their interest level," said Ms. Long. Other agencies were responsive, she said, but "their vested interest didn't come across the way it did from R/GA."
But young doesn't mean cheap. "We have made progress in elevating entry-level salaries and how we motivate rising stars at the early stage of their careers," said Horizon CEO Bill Koenigsberg. The media shop is particularly on the lookout for data scientists, vertical analytical specialists, inventioneers, technologists and behavioral scientists. To retain and best use those people, Horizon offers a two-year rotation across disciplines within the shop.

Like R/GA, 72andSunny and Deutsch have adopted a hiring-ahead-of-need strategy, and, for Deutsch, it's mostly for senior roles. Mr. Sheldon said that when shops pitch new business, the client will want to know the key senior people on the account -- and that they will stay on the account. "Unless you hire ahead of need, you either lie to the client, or the people you bring into the pitch are working on another account, and then they go back to their other accounts."

Over the past 12 months, MediaCom U.S. CEO Sasha Savic has tripled the number of people dedicated to recruitment to 20, including freelancers. The agency has focused on building relationships with more recruiters to staff new business with people at all levels, from both inside and outside media agencies. He has also tripled cash rewards for employees who recruit friends.

The difficulty finding talent has also turned into opportunity for young workers already at media shops, which have been squeezed on fees and have stretched people who know how to be strategic and creative across too many accounts. Some agencies have had to promote less-expensive junior talent into senior roles -- sometimes they're ready; other times they're not -- to earn the higher fees clients pay for more senior people, according to industry executives.

Other approaches
Carat, part of Dentsu Aegis, uses the diversity of the network, which owns a variety of agencies, to keep people interested and stimulated. More than 40% of the shop's staff transferred to another Dentsu Aegis company or account last year, said Mr. Ray. Historically it's been 25%.

Cross-agency models also help shops avoid the competitive talent market altogether. Havas Media North America CEO Lori Hiltz said Havas Villages -- office concepts that bring most Havas specialist groups under the same roof -- have created efficiencies. Rather than go out and hire a full-time production staffer, for example, Ms. Hiltz said the village made it easier for the media group to work with a production house previously reserved for creative.

Still, agencies can't in-source everything, and retaining talent and hiring is tricky when other companies are offering higher salaries and better titles for talent under the $100,000 level, even if they're not ready for a bump, said Ms. Hiltz.

TBWA Los Angeles' first chief production officer, Tanya LeSieur, starts with the Omnicom shop this month. While one goal is to produce more in-house, the agency also wants talent that knows its limits.
"We need strategic producers who understand where the world is going, and can look at an idea and understand what the best resources are to produce it, whether it's us or someplace else," said TBWA Los Angeles President Luis DeAnda.

Contributing: Malika Touré

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