Six Degrees of Integration
There is no general in the Lincoln War Room, the circular office at The Y&R Companies in Irvine, CA, that serves as command central for all strategic planning on the auto maker’s account.
Leading the team charged with shepherding the Lincoln account these days is Ian Marlowe, the representative from brand consultancy Landor Associates. Marlowe took the reins as group director last spring when Mark Turner, the Y&R Advertising rep, moved up to oversee both the Lincoln and Mercury businesses.
But it could just as easily (at least in theory) have been someone from direct marketing and promotion shop Wunderman, or ad-buy unit The Media Edge, or p.r. firm Burson-Marsteller who took the reins.
Because in Irvine, there is no lead marketing discipline, and no cause for squabbling among sister agencies all looking to hit their own numbers. It’s a single profit-and-loss center that parent Young & Rubicam (and its parent, WPP Group) evaluates based on the sum of its parts. “You focus 100 percent on the client’s brands, and everything else takes care of itself,” says Turner, now executive vp-director of strategic planning for the Y&R Companies.
Maybe it’s the laid-back California atmosphere that has Y&R walking the walk to which so many other agencies are offering little more than lip-service: discipline-neutral marketing plans that consider the client’s needs — first, last, and every place in between.
One Big Happy
Agencies these days come in many shapes, sizes, and business structures. Most talk integration, although there are a fair number of traditionalists who valiantly cling to their niche status. But while cohesive marketing plans and unified brand messages are the current name of the game, there are as many theories on how to achieve it as — well, as there are agency structures.
“Integration is a lot of talk,” says Lee Hill, president of DraftWorldwide Chicago. Most sister agencies “may have the same name, but they all fight over the same budget.”
Chicago-based Draft took a step forward this summer by unveiling Surge at DraftWorldwide, a promotions unit that aligns Draft’s capabilities with those of formerly distinct sisters KBA Marketing and Group III Promotions into one profit-and-loss center. Administrative unit D.L. Blair, Garden City, NY, remains a separate unit. “The concept was always there. The timing was driven by the clients,” says Kevin Berg, KBA’s founder and Surge’s vice chairman. (Hill is president.)
Draft’s parent, Interpublic Group of Companies, hasn’t as yet taken the giant leap of completely mingling the major disciplines (advertising, promotion, and p.r.) that Y&R has. “I think that’s something you will see happening in the future,” posits Berg. “The lines are blurring all the time.” Interpublic may have begun leaning that way in July, when it formed “The Partnership” to link Draft, ad house Lowe Lintas & Partners, p.r. firm Golin/Harris International, and ad buyer Initiative Media for “collaboration.”
A sign of that came in August, when Burger King appointed DraftWorldwide chairman Howard Draft as point man on its integrated marketing team, which includes ad shops McCann-Erickson Worldwide, New York City, and Campbell Mithun, Minneapolis — both Interpublic sibs. The chain tapped all three agencies in early January after separate, extensive reviews of its ad and promo accounts (March PROMO). Although a Burger King spokesperson called the selections “a coincidence more than anything else,” sources say the QSR was intrigued by the idea of having all strategic shops under one roof.
A similar situation exists at True North Communications (now also part of Interpublic), which united its worldwide promotion and marketing services businesses into a single P&L in 2000 under the Marketing Drive Worldwide banner. Although Marketing Drive works with sister ad agencies, it remains separate (December 2000 PROMO).
Marketing Drive’s method is to provide a technology-driven backbone of services that lets a client’s regional marketing teams (as well as sales forces and retail partners) work together more efficiently. The network is helping Boston-based Gillette “to varying degrees” around the globe, says Michael Harris, president of Marketing Drive Boston.
On the other hand, Gillette division Duracell recently opted to move its account when the three Marketing Drive executives who were handling it left the agency to launch CircleOne, Norwalk, CT (see “Agencies”).
“The big motivating factor was their experience, and the quality of the work they had brought to Duracell over the years,” says Dan McCarthy, product manager in Duracell’s global marketing group. “If they don’t have the capabilities themselves, we’re confident that they can source it out.”
E Pluribus Unum
Therein lies the heart of the issue: Does it take a networked group of agencies — however they’re aligned — to provide proper integration, or can it be fostered within a disparate group of businesses? To pose it another way, should the client or the agency be responsible for driving the integration?
“An agency is a name. It’s all about the people,” says Jeff Slater, vp-marketing for Raleigh, NC-based GoodMark Foods’ Slim Jim. “I think ‘synergy’ is the biggest bunch of bull. I want people who can play together and understand the business. The synergy is in the human interaction.”
For the last three years, Slim Jim’s roster has featured North Castle Partners, Stamford, CT, for advertising; GMR Marketing, New Berlin, WI, for events; and Richard French & Associates, Raleigh, for p.r. When the brand tapped the folks at San Francisco-based Red Sky Interactive for Internet work, “I didn’t know they and GMR were Omnicom sister agencies,” says Slater. “We picked them because we thought we could work with them.”
Slim Jim began preparing for its summer Rebelli-ache music tour sponsorship two years ago by assembling reps from the agencies for a “brand-storming” session. “You want people to understand and share their collective talents,” Slater says. “If you have people who are committed to the success of the project, it doesn’t matter where they’re from.”
Two Shall Be One
Then there’s homegrown compatibility. Instead of buying an outside shop to gain promotional expertise, Boston-based Arnold Worldwide (owned by the Havas Advertising network) formed its own promotion unit in early 1998. Arnold Brand Promotions now has 30 people working on 10 accounts, nearly all of which are ad-side clients as well.
“We have world-class creative thinking applied to promotions,” says senior vp-director Beth Rice, who was brought in from Boston neighbor Hill, Holliday to launch the practice. “We’re involved with the ad agency on a daily basis.”
In developing a tour of “pink-slip parties” this year for Maynard, MA-based Monster.com, “our [ad agency] creative people helped design the truck and our media people helped pick the markets,” says Rice. “To have that caliber of people talking about things like premiums is goose-pimply.”
The brand group, which is largely event-focused, is not a stand-alone unit because “that’s the place where integration fails,” says Rice. “Bringing down those financial barriers are important. I think smart agencies recognize this.”
Auburn Hills, MI-based Volkswagen of America, a client since 1995, keeps its advertising and promotion budgets separate. But the people at Arnold “aren’t worried about how the money comes in, but what’s best for the brand,” says Heidi Korte, Volkswagen manager of promotions and sponsorships.
The advantage to having the promotion agency sitting hard-by the ad folks is that “the client doesn’t need to constantly educate the agencies about everything that’s going on,” says Korte. “It boils down to communication. Everyone is delivering the same brand message.”
Not that Arnold is all services, all the time. Lexington, MA-based Stride Rite Corp.’s Keds is a promo-only client, and the brand promotions group wants to have at least one-third of its business be that way, Rice says.
Many believe the specialty route is still the way to go. Summit Marketing, St. Louis, united a group of nine marketing services acquisitions into one operation last year (June PROMO). Nonetheless, ceo Daniel Renz expects most new business (at least short-term) to continue coming through the need for individual capabilities, not integrated ones.
“You lead with a core strength and a relationship. Without that, you’re just swimming upstream,” Renz says. “Once [clients] have enough confidence in what we can provide in one area, then their minds are open to us.”
All for One
The various agencies at Y&R Companies also have discipline-specific work. Wunderman, for instance, manages Irvine neighbor Taco Bell’s promotion account from the office. With 400 employees, Irvine is parent Young & Rubicam’s second-largest location.
It’s important to maintain that uniqueness, even while strengthening integration, executives say. “Integration becomes a failed model if you try to impose all of the disciplines on a client,” says Y&R Companies ceo David Murphy. “Then, you’re just back to selling things.”
The unified model was borne out of Y&R’s relationship with Lincoln Mercury, which the agency followed out to Irvine in 1998. “We are firm believers in the benefits of experience marketing,” which made Lincoln Mercury more open to the concept, says marketing communications manager Deborah Wahl.
Y&R’s approach began with a dedicated brand team for strategic planning and concepting, and expanded this year to include unified execution teams (dubbed Key Client Initiative groups). Team members aren’t necessarily the account leads or department heads, but “the experts on the brand,” says Turner. The team leader serves as “client advocate,” handling all external communication. Everyone assigned to the account sits together — except for the creatives, who stay with their own tribe.
The team holds mandatory meetings at least weekly in the War Room, teleconferencing in anyone on the road. It makes presentations to the larger account group about twice monthly, so the “individual cogs” are kept up to speed on all activities, Turner says.
The structure “pushes the level of responsibility down to the working groups, so they don’t have to waste a lot of time getting approvals on everything,” says Wahl. “I know the things I’m asked to look at are for the benefit of my business, not someone else’s profit. They’re the best programs I’ve ever seen.”
“The biggest inhibitor to true integration is the conflict among disciplines … and dueling P&Ls,” says Murphy. Once those obstacles are removed physically, getting employees to embrace the idea mentally is “not a slam dunk, but I think it’s easier than most people believe. The veterans have been around long enough to know that it’s about the ideas. And the 20-somethings don’t define themselves by discipline,” he says.
“You’re working with one united team that understands the vision and is working together to achieve that vision,” says Wahl. “It’s really hard to try and instill that if you’re working with a bunch of different suppliers.”
Murphy says he expects the concept to catch on, especially as technological advances make it less vital to have the integration take place physically. Wahl thinks that it should.
“If I ever do work with another agency, they better have been watching,” she says. “Because we’ll move them to this structure.”
