AAF Told Ad Agencies Must Change, Change, Change

Publicis CEO Maurice Levy Closes Conference With Provocative Speech

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SAN FRANCISCO (AdAge.com) -- Publicis Groupe Chairman-CEO Maurice Levy closed out the American Advertising Federation's annual convention with warnings that consumers are becoming "enlightened despots," that print's cover price "is no longer suited to today's world," and that ad agencies must "change, change and change."
Maurice Levy says agencies must 'change, change and change.' | ALSO: Comment on this article in the 'Your Opinion' box below
Maurice Levy says agencies must 'change, change and change.' | ALSO: Comment on this article in the 'Your Opinion' box below Credit: Chris Cassidy

Provocative speech
In a provocative speech yesterday that capped the four-day conference, which focused on mastering digital change, Mr. Levy said unless ad agencies move quickly to serve new masters, the agency of the future could be described as "one that is still around."

"I have no idea of what the future will be, but I can guarantee you that three key ingredients will be needed: change, change and change," he said. The key to the future, Mr. Levy said, is understanding that consumers are empowered by technology and can choose what they want.

Consumers take center stage
"In the past, consumers were at the very end of the business process. Now, with the internet, the mobile phone and the ever-more-amazing array of new services, consumers have moved center stage," he said. "For our industry, they have become what you might call enlightened despots."

Agencies have to learn to answer to the greater awareness and greater volatility of the new consumer, Mr. Levy added. But he cautioned that the same technologies that empower consumers by giving them additional choices make reaching them with a mass approach more difficult, forcing more one-to-one marketing. "Not only will we have to deal with more and more consumers, but, perhaps paradoxically, we will also have to plan more and more individual highly targeted campaigns."

He didn't criticize print content but questioned the practice of charging consumers who want hard copies in an age when they can get free content on the web. "We all know traditional media are all losing ground in one way or another. But it would be just as ill-advised to completely dismiss traditional media -- waving them aside as obsolescent -- as it would be to ignore the fact communications will never be the same as they were," Mr. Levy said. "Having to pay to get access to information will be increasingly seen as an imposition, as it already is in the eyes of many young people."

Mass media obituaries 'premature'
Mr. Levy also said that despite the need to reach out and do one-on-one marketing, mass media's decline has been overstated. "Clearly, in just a few years from now, mainstream network television will not be as central to advertising-agency business as it is at present. But I would warn against the common enthusiasm for premature obituaries. Television, defined as high-quality video and audio content delivered to a screen, is not on its way out. It will remain a unique source of information, of entertainment and, I hope, of education, that will continue to attract family audiences for several hours each day. By the same token, I believe, it will remain an essential vector of campaigns. "

In an interview, Mr. Levy said Publicis has gone through three revamps to meet technology needs in the last decade. He said companies that have change "in the genes" have an easier time adapting.

He also said Publicis is well positioned for a changing marketing world. "We have two advantages compared to the others: We are smaller, and we are fresher, so we are not yet crystallized or frozen in our structure."

Two other warnings
Mr. Levy's comments came after the convention heard two warnings -- one about moving too quickly to make digital marketing the total focus of marketing campaigns, and another that marketers had better get more involved in the Washington public affairs issues or be prepared to face dire consequences.

"We have to be careful about getting digitally drunk," said Paul Kurnit, president and founder of KidShop and Kurnit Communications. It's OK to try to include digital efforts, he said, but marketers need to determine their impacts before moving too quickly.

Doug Wood, an advertising lawyer and partner at Reed Smith, warned that the advertising industry is "a passive industry in an active world" and is "behaving in an opposite way than we need to" in dealing with Washington issues, such as attempts to regulate food advertising to children. "Get your picture with Tony the Tiger, because he could be an endangered species," Mr. Wood said, pointing to someone dressed as Tony standing just outside the conference entrance.

AAF Chairman Andy Jung, senior director-advertising and media for Kellogg North America, announced at the meeting that AAF had extended the contract of Wallace S. Snyder, AAF's president-CEO, through 2008.
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