Stick to the plan, no matter what

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: From the very start there were two rather different approaches to the (account planning) job, and the range has widened since then. At one extreme, there are the “grand strategists”, who are intellectual, aim to see the big picture, are a little bit above the fray, and almost economists. At the other are the “advert tweakers”, who peer myopically at advertisements, conduct group discussions, justify creative work to sceptical clients, and are almost qualitative researchers. Most agencies lie somewhere in the middle, veering around as agencies do. Of the founders of account planning, BMP started from a research department and so tended to be right of centre; JWT started from a marketing department, and so tended to be left of centre.

All the many changes in marketing over the past 20 years have pushed account planners one way or the other on this scale. On the whole the external forces of clients’ needs have moved them towards the strategic end and the internal changes in the advertising business to the tweaking end.

First, of the external changes, the squeeze of the marketing department from the glories of the 1960s—the disillusion with the inflated promises of “Management Science” (success untouched by human imagination), the ratchet effect of retailer pressures, the 1970s crisis in branding, the decimation of budgets and staff. The marketing department turned out to need outside strategic and brand-building help after all.

Secondly, the new converts to marketing. In 1970, 53% of press and television advertising expenditure went on the traditional repeat-purchase goods; by 1987 it was down to 39%. The new big spenders—corporations, financial services, government departments, cars, durables and leisure goods companies—tended to have come rather late to marketing and often didn’t really think of themselves as brands. Promotions attracted them because of the effect on volume sales. This was a great opportunity for account planners to demonstrate to these converts the values of strategic branding in building margins.

Thirdly, technological leapfrog. When the new product that you’ve slaved for two years to develop is copied and undercut in the marketplace in two months and outdated from Taiwan in six, how do you recover your development costs? When the sheer speed of change overwhelms, how does the now under-staffed marketing department cope? The only answer is added values through strategic branding; and, again, there’s a need for outside strategic help and advice.

Fourthly, retailers discovered branding. Nearly all the most exciting strategic branding ideas in the 1980s have come from them. Led by Habitat, Laura Ashley, The Body shop, Next etc; now increasingly followed by bigger retailers—M&S Foods, for instance, or Sainsbury’s Homebase or the new plans for Safeway. If manufacturers’ brands were to flourish in this context, no amount of tweaking would be enough. Account planners, to be really useful to clients, had to offer something at the strategic end of the scale.

Fifthly, consumers the-mselves, as they moved from the new individualism of the 1970s to the Designer Everything of the 1980s. What people came to want, in almost everything, was both variety and style. A company like Hi-Tec meets this by making some 200 different styles of shoe—a manufacturing triumph but a bit of a problem for marketing and distribution. A clear need for the account planner’s classic role of strategic simplifier.

But if external changes were drawing planners to the left, two changes within the advertising business were pulling them to the right, to a much more exclusive concern with advertisements. The first was the recognition that, today, consumers know about and willingly participate in the game of marketing. They had come to value a company for the style of its advertising, not just the contents or the arguments. The Benson & Hedges Gold ads became collectors’ pieces not just for advertising people but for everyone. Account planners became much more involved in the fine tuning of creative execution. They ran group discussions, listened to the nuances of consumers’ responses to rough ads and then justified what was often “difficult” advertising to the clients.

Then the change in structure of agencies built on this newly respectable creativity. Suddenly, led by Saatchi, agencies moved from being professional partnerships to being businesses in their own right. Competition between them increased. Priorities, time frames and values changed somewhat; the advertising business started to look inwards a lot more. The new businesslike vigour stimulated many new agencies, who came in waves called Beagle, Bargle, D’Annunzio, Twigg and Privet. Most of them were based on creative people, and their high creative standards set the agenda for all agencies. While the resulting British advertising is widely admired, there is a danger lurking of an inward-looking circularity—a belief that great ads are ads thought great by great advertising people. (One is disturbingly reminded of the analogy of architects, who tend to believe that great architecture is architecture that is thought to be great by great architects—and to hell with the people who have to live in their buildings.) Again, account planners moved to the right on the scale, because they were increasingly judged by their success in contributing to and selling the most creative campaigns.

By far the most important change of the last 10 years has been the “new radical economics”. The British do genuinely seem to have turned away from making charming apologies for industrial failure and moved towards a zeal for success. There is a sort of national recognition that competition is here to stay and that it’s anyhow quite stimulating.

The first part of the process has gone quite well; there undoubtedly has been a big improvement in manufacturing efficiency. But of course you can play that trick only once. You can move from having 11 factories working at 30% capacity to four factories working at 83% capacity, just once. It’s absolutely necessary to do it, to keep improving efficiency, to be a low-cost producer, but it’s not sufficient; it’s merely the entry fee.

The harder part of the economic miracle is yet to come, but there are some signs that the issues are being recognised. There seems to be a dawning acceptance that long-term profits and success—even survival—for companies, whether they are manufacturers or services or institutions, will depend on the depth and quality of their brands. That is, on having something to offer that is “better and different”; that has a unique combination of physical, functional and stylistic values; and that has a clear brand personality, expre-ssed in every aspect of performance and communications.

It’s still early days: the word “brand” is still associated mainly with packaged groceries. But there are signs of hope. In the dark recesses of the human mind, in the city and among accountants, it is becoming apparent that the traditional balance sheet is giving a very partial view of a company’s worth. Most dramatically, Rowntree’s 1987 accounts gave the group’s gross tangible assets (land, buildings, plant and machinery before depreciation) as about pound 700 million. Even if one makes every possible allowance for current assets and for the traditional conservatism of such calculations, the real value of the company as a going concern was more than twice as much. The brands which made up over half the value of the company did not appear in the balance sheet at all. To more and more people it is beginning to seem ludicrous to refer to Kit Kat and Black Magic as intangible or to suggest that around pound 1.5 billion of Rowntree’s value is “goodwill”—as if the company’s success came from a vague benevolence on the part of the public, rather than from a lot of investment in the invention of brands and a lot of imaginative work by many people over many years.