So Much for Intellectual Property

Despite Tough Talk, Agencies Still Giving It Away

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NEW YORK ( -- The new-business pitch has long been a place for agencies to get their ideas stolen. Now, despite an industry effort to take a bite out of intellectual-property pilfering, a recent pitch was the occasion for Madison Avenue to put on nothing less than a full-scale conference for a would-be client -- all free of charge.
Bob Greenberg
Bob Greenberg

Earlier this month, Dell played host to some of the industry's smartest digital thinkers in day-and-a-half conference on new media run by the computer maker's marketing team. Leading lights such as Bob Greenberg of Interpublic Group's R/GA, Jack Klues of Publicis Groupe and Sean Finnegan of Omnicom Group descended on the cafeteria at Dell's Round Rock, Texas, headquarters for a series of panels and presentations on "how to drive positive word-of-mouth in the digital world," as a Dell blogger put it. The content was recorded and made available to employees in a webcast, a handy tutorial for legions of Dell employees trying to turn around a company with a fair share of brand challenges.

Mad Ave. Giants Duke it out Over Dell

The Dell Buzz Summit, as it was called, was less productive for the agency business. That the confab came right smack in the middle of a holding-company shootout for its massive ad and marketing-services account -- said to be worth as much as $100 million in annual revenue -- and that the agencies weren't paid for their time, their travel or, most important, their ideas, is yet another indication that the ad business is failing terribly in its self-defined goal: to protect its most prized possession: intellectual property.

Unfavorable system
One attendee, when asked whether his shop was compensated, was as dry as the Texas soil in August. "No," he said, "I support charities like Dell." Other agency executives, speaking on condition of anonymity, gave similar accounts.

Since they were shorn of the 15% media commission's reliable profit and faced with tightfisted procurement executives whittling away their fees, agencies have faced a rather steady spiral of commodification. Not helping matters is a generally unfavorable system for conducting agency reviews that often reduces what should be a battle of ideas to a game of financial limbo -- How low can your fee requirements go? -- along with a disregard for intellectual-property mores flagrant enough to make a Chinese DVD pirate proud. Marketers from Hilton Hotels to Kraft Foods have in recent years demanded that agencies cede the rights to their ideas even if they're not hired, sparking outrage, if not action, from agencies.
Jack Klues
Jack Klues

"If Dell's motive is to harvest ideas, that's not what the search process is about," said Tom Finneran, exec VP-agency management services at the American Association of Advertising Agencies, which recently authored a white paper urging its members not to give away their ideas. "It is, quite frankly, bizarre. It's an out-of-bounds methodology."

In this case, Dell effectively received a free conference that included some of the agency world's foremost thinkers on issues such as search, mobile, word-of-mouth and other hot topics. It's not unusual for agencies to give marketers seminars, but it is unprecedented for them to do so in the middle of a competitive pitch.

Agencies weren't paid
There was the additional indignity of jamming bitter competitors into the same facility at the same time, forcing them to go to strange lengths to avoid each other. Omnicom's rivals, for example, weren't allowed to sit in on presentations by Omnicom executives. And Dell staffers in attendance were instructed not to interact with participants outside of the sessions. Agencies began to plan for the summit about two months ago, before anyone knew of Dell's plans to hold the review. The agenda was revised and seemed in flux until the last minute, when visitors arriving for a "networking breakfast" found it was limited to Dell folks. They were instead whisked off into the green room.

A Dell spokesman confirmed that agencies participating in the Buzz Summit weren't paid, but he characterized the event as "voluntary" and said it was scheduled before the review planned. He said it would have no effect on the outcome of the review. "The intellectual property of each agency was respected," said the spokesman, Bob Pearson. "Once a person spoke he was asked to not stay any longer at the summit so there would never be any overlap with another agency." But one attendee had a different interpretation of its impact on the pitch, saying he thought it was "possible to blow the pitch, but not possible to win the pitch" with the presentation.

Another called the proceedings "comedic...lightly amusing...multiple shades of weird."

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Contributing: Brooke Capps
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