Tuesday, July 22, 2014

the great advertising swindle (actor-observer bias remix)

Advertising's outcomes are notoriously hard to measure.

Which is why in advertising agencies, we love to measure outputs instead.

Agency outputs (ie creativity, ingenuity, technical wizardry and planning cleverness) are far easier to evaluate than the contributions that the work has to actual client business outcomes.

Despite this clients will often clamour for performance based remuneration deals from their agencies.

Some agencies even claim to offer this.

How they can do this is unclear.

I'm oft to remark that if it were possible then Y&R London should still be receiving a performance based royalty from Heinz Beans for the work of their then deputy creative director, the young Maurice Drake, who penned the famous tagline 'Beanz Meanz Heinz' over a couple of pints of a lunchtime back in 1967.

Maybe they are, who knows?

The fact is that the effects of great advertising often take a long time to unfold.

And many other factors other than the advertising will affect brand performance.

(The effects of shit advertising tend to reveal themselves much sooner, of course).

So when, among its peers/competitors, agencies performance can - for the most part - only be evaluated in terms of the creative output, then the agencies themselves are highly incentivised to squeeze the juice out of those outputs regardless of whether those outputs can be said to have contributed to business outcomes.

Even the planners effectiveness awards, known as Effies, are no more precise, for the most part only describe shorter term effectiveness, and are often forced to rely on qual/quant research of highly dubious methodology (such is the ineptitude of our market research cousins, but that's another topic for another time.)

Perhaps you have been following the ad scam kerfuffle over at Aussie media commentator website mUmBRELLA.

If not, then in summary, it has come to light that a few Australian press ads that picked up Lions at Cannes this year benefited from somewhat 'limited' distribution.

While the ads met with the criteria for entry, it has been argued that running one time in a suburban newspaper of little consequence is not fair play.

There's plenty of opinion around this. Several articles have been written, each receiving large numbers of comments.

I'm not going to add further opinion, but perhaps offer some thoughts towards the beginnings of an explanation.

From personal experience I've played in two broad camps.

Both highly incentivised to pursue award-winning activities.

In big network agencies, consistently receiving global and local awards was an absolute imperative.

At [agency X], for example, every Monday morning we would roll in to work and be curious to find out which awards the agency had won over the weekend.

And every significant piece of work seemed to have its creative award entry case study video constructed almost in parallel to development of the campaign itself.

To my knowledge there was never anything cooked up specifically to try and manipulate creative awards, however every piece of work was evaluated internally for its creative award potential, and certain pro-bono work was often considered for the same reasons.

There's nothing hokey about this approach. It's correct.

However, if a major award show came and went where the agency performed poorly in terms of metal then one could feel the pressure to return to winning ways a soon as possible.

In this environment, where success is routine, then winning becomes table stakes.

In smaller agencies or even decent sized indies there is a different sort of pressure.

To level the playing field then these agencies have to look that little bit harder to find the opportunities to generate outputs that can stand up against the outputs of agencies with more resources and better clients.

One could describe the situation as a kind of agency double jeopardy.

Smaller agencies get hit twice. They have fewer, less sophisticated and resource rich clients, who also tend to be less loyal.

This provides the smaller agency with plenty incentive to 'maximise' and then possibly manipulate outputs in order to portray their creative abilities in the best way.

Because no agency is going to attract new sophisticated clients with a portfolio of mediocre work.

By hook or by crook you need to get the goods.

Now, we are aware that the agencies under scrutiny in the Aussie case are DDB, Saatchi's and to a slightly lesser degree JWT. All outposts of big global networks, not small by any stretch.

However, the Aussie market is somewhat peculiar inasmuch as just about every global network has an office in at least two (often 3 or more) of the major cities.

Everyone is scrapping with everyone else.

In the absence of any way to meaningfully measure clients' business outcomes, the industry evaluates itself in the only way it can. Though outputs - and in the arena of award shows.

The volume and quality of new business an agency attracts is explicitly connected to the volume and quality of the awards they accrue.

The more you get, the more you get.

Without making any judgement call on what-is-or-is-not-scam perhaps some clarity comes from knowing this about our own foibles as an industry.

And perhaps it might not be a bad thing to put this years what-is-or-is-not-scam debate to bed and get on with next years award winners.

Because, as an industry perhaps we suffer from a collective actor-observer bias.

When we judge our own agency's behaviour, we are the actors, and perhaps we are more likely to attribute our actions as a response to peculiarities of the situational factors of the industry; than to any general sense of our integrity or lack of.

However, when explaining the behaviour of others (our competitor agencies), we are far more inclined to attribute their scam ads to their overall cheating-bastard disposition rather than to any of the situational factors that influenced us.

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