With Robin Bonn, Agency Growth Specialist, Founder Co:Definery
00:00:00 - Selling, growth and affecting change
00:18:00 - Accountability and value
00:28:30 - Agency challenges moving to outcome-based work
00:43:00 - The responsibility for defining value
00:54:00 - Benefitting from a closer relationship with procurement
01:03:00 - Fitting expertise into different pricing models
01:22:00 - Plans for the next 12 months
Jonny Dunning: 0:03 Cool. Okay. And we’re off. So I’d like to welcome Robin Bonn to the podcast. Thank you very much for joining me, Robin. How are you?
Robin Bonn: 0:10 I’m very well, Jonny. Thank you very much for having me.
Jonny Dunning: 0:13 Excellent stuff. So you are an agency growth specialist and the founder of Co:definery. And we’ve got some great topics to talk about today, specifically, delving into the marketing industry, an industry, you know extremely well. And looking at the opportunities in that area for outcome based work delivery. Obviously, it’s a subject that is very close to my heart. And before we get into that, but I have a question for you. How did you get from cell biology to management consultancy?
Robin Bonn: 0:43 That’s a good question. I often asked myself the very same thing. In all honesty, I loved biology. But then when you go to university, and you learn more and more and more about less and less and less, so got quite bored by it quite quickly. So I think probably like a lot of people, you do a degree and you’re lucky to do it. And that’s all good. And then you fall out of it not knowing what to do. So I found myself in a recruitment agency office. And they said, “Well, you can count to 10. And you can string a sentence together and you haven’t got any obvious facial disfigurement. So you might have want to consider a career in sales.” I’m like. “Okay, whatever, I’ll give it a whirl.” So I ended up selling very big computers to universities for about three years. So I did the whole sort of Glengarry, Glen Ross, always be closing leaderboard on the wall sharp elbowed, competitive sales floor type sales role for a few years. And then I found myself in agencies after that. So they’re run very differently from a sales and growth perspective. But I’ve never forgotten that perspective on selling that grounding in selling, which is interesting, and I’m sure we’ll touch on it later. But more often than not selling is almost a bit of a dirty word within agencies. So yeah, I did my time in agencies. I worked in big ones, small ones, new ones, old ones, global ones, startup ones. And around the sort of the middle of the last decade decided that having done all sorts of commercial and growth and marketing and new business and some marketing and selling type roles within agencies, you end up being asked to do the same thing again and again and again, and your ability to really affect change from within that kind of Central growth role is pretty limited. You can tend to change quite a lot, if you’re given a transformational agenda. You can tend to change quite a lot quite quickly within maybe year one. And then it just gets harder, because you become part of the problem effectively. So the idea of being able to affect change within an agency business model, it became obvious, you could do more externally than you could internally. And that’s how I found myself, I think in 2016, sort of launched Co:definery formally. And as a management consultant now, so many of the barriers against changing agencies. They go away, because you only ever get brought in when people are ready to really change things. Because the meters running, if you like, know that sell time, but because they’re paying for you to be there. They will be ready to change, they will line up people behind change, and as a sort of facilitator and a catalyst for positive outcomes in the business. Then it’s a much more productive way of trying to make better agency businesses. So very long answer to a very simple question. But I think the empiricists in me as a scientist, I still find useful, the kind of the rigor and the structure that I guess being a “scientist” gives you is relevant, but certainly from agencies to here, it’s about getting more done in less time. And I think that’s the bit I probably enjoy most about being a consultant to agencies now.
Jonny Dunning: 3:58 Yeah. And I agree with you when you’re talking about the analytical side of coming from a scientific background. I mean, in terms of putting in efficiencies to the agencies you’re working with, I’m sure, there’s quite a lot of analysis of process and data and structure that will go into that to make inferences. I, myself, came from a similar scientific background, the University, I came out of it. I actually remember reading an article in The Economist. And it was basically writing degrees subject by the percentage increase in the expected earnings against the average wage in UK. And you know, I have a friend who was studying economics or whatever [unclear 0:04:33], he was 60% increase or whatever. And I remember my degree gave me something like -3% against the average and I was like, “Okay.” Maybe should have researched that a bit before. But I certainly found myself the value of that kind of evidence based methodology and the kind of rigor and the research and the analysis of data. It certainly has its uses and ultimately when you’ve done that structured learning, you can take that into other areas. And I think, having done some work with people like Boston Consulting Group and other management consultancies in previous roles, that’s the type of methodology that I see coming through in some of the management consultancy practices. So I can see why that would be very transferable. But then you’ve got all of the experience that you’ve had in the marketing world to add to that.
Robin Bonn: 5:24 It’s an interesting thing, because the idea of a sort of classic empiricist, where you’re looking at data and making hypotheses and then trying to just prove them, as a scientist would, that’s pretty alien to most agencies. And in fairness, sort of what passes for rigor in most agencies is a pretty low bar. There’s a very good consultant I know called Lucy Good, I think she has an MSc in organizational design. She’s really looked at the absence of evidence based decision making within agencies. And in some respects, it stands to reason, because the old cliché about you only need a kitchen table and a computer to start an agency is pretty true. Certainly, it been proven even more true over the last sort of year and a bit as that’s kind of how business has been done. But you don’t really need that level of rigor, particularly in more creatively driven agency businesses. But I do think that sort of analytical, holistic view is becoming more and more important to the leaders of agencies. I think, a lot of the challenges that those people running those kinds of companies have, I suppose, thought about in the past. They’ve been quite siloed, which is kind of unforgiveable in such small businesses. But there’s a sense of... You know, there’s a new business challenge over there. There’s an HR challenge over there or an operational one or a profit one or a finance one. And I think increasingly, it’s the sort of red threads that bring those different disciplines together within the agency business. That is where there is latent value. There’s rarely a sort of AHA moment. It’s like, “Oh shit, a marketing plan! Who knew?” But you had to do that. But actually, the connectivity and the sort of the downstream impact of what might go on, for example, in your DNI strategy, and the impact that might have on an aspect of your business strategy; connecting those things together, I think is where a lot of value can be created very quickly within agencies, which I guess is kind of scientific, even if it’s not quite so classically empirical.
Jonny Dunning: 7:29 And do you think that the reason or part of the reason that agencies are having to be a bit more methodical and scientific is because clients are trying to be more analytical and scientific about what they’re getting from agencies?
Robin Bonn: 7:42 Yeah, that’s a good question. I suppose it’s hard to answer with fresh eyes, because I obviously bring my own personal worldview into that. So I think, the client perspective - I think you’re right - is the driver. I think the reality is that so many of the complexities that clients have increasingly being sort of faced with over the last 20 years, and we could talk endlessly about how marketing as one aspect of that have changed, even before we get into the role of the chief procurement officer or the chief technology officer and all the other kind of mega trends, if you like the we’ve seen, as businesses become more digitized over the last, whatever 20 years [or] 30 years. That remit and that I suppose perspective on the agency marketplace has shifted dramatically from the client side. And I think we’ve seen it shift again dramatically over the last, whatever it is, 15 months. So I think whatever you as an agency leader, whatever your experience of that change in how clients in their needs, the breadth of their requirements, the urgency of their requirements, their time and willingness to engage with the agency marketplace, the things they care about what they’re prepared to pay, what they consider value, whether they will be prepared to pay a premium, there’s loads of stuff in that. And I think that as I say, particularly in the last sort of the pandemic times if you like, that’s accelerated realization that agencies need to think a lot more holistically about the way they cater for the market. There’s been a, I think, much more, I suppose, action based understanding of standout for example.
Jonny Dunning: 9:28 I’m just picking it up.
Robin Bonn: 9:34 Alright, I’ll just let it pass. That’s loud.
Jonny Dunning: 9:41 You find this end.
Robin Bonn: 9:43 Okay, good. Sorry. I probably should have carried on.
Jonny Dunning: 9:45 No, it’s all right.
Robin Bonn: 9:46 So yeah, that change in perspective on what clients are asking from agencies, I think, is becoming something that agency leaders are much more willing to act upon. So things like standout is a great case in point. So many of the traditional agency, so called propositions, they’re really just straplines. They don’t really confer any great differentiation. They kind of talk a little bit about how the agency operates, but it doesn’t really speak much to a discrete target audience or a particularly ownable outcome that agency can bring to the party. So just on that one topic of “how do we stand out and how is that stand out kind of presented to the market? How do we substantiate it? Why should clients care?” I think that’s being thought about in a much more holistic way now. And as much as... Yeah, we could have just had a strap line in a new website. But actually now what we recognize we should be thinking about is, the strategy of the business and the proposition being one and the same, how does this impact the leadership? How does this impact us operationally, structures process, people strategy, as well as the more obvious things like marketing and how we sell differently, how we price differently? So the connectivity between all those things, I think, is very much driven by how the client demand is changing, but particularly now how I think agencies are listening more to clients than they ever have done.
Jonny Dunning: 11:10 Yeah, that’s very interesting. And when organizations or an industry like that has to make changes, it all pushes towards how mature is the organization, how well structured is the organization, how well - as you say - linked up is their overall strategy, because they’ve got to start moving pieces around, they’ve got to start changing things, and reinforcing messages or changing the message getting a better message out there. And it also comes down to the delivery. I mean, with the whole COVID situation, would you say that as a general rule that has negatively impacted the kind of marketing agency world.
Robin Bonn: 11:49 I suppose by nature, I’m an optimist. And putting aside, obviously, the sort of horrible human cost of the whole thing, I think, from an agency perspective, I like to think that there will be a lot of very positive legacies to come out of COVID. And equally, I know, plenty of agencies that have been horribly badly affected, not least; necessarily, because they’ve been in a you know, they’re badly run agencies and didn’t have cash in the bank or whatever. But they were just in the wrong place at the wrong time. They were very exposed to events in experiential. You know, lots of business coming out of Italy, when Italy closed down very quickly, [and] all that kind of stuff. So just being in the wrong place when the music stopped is a tough situation. But I think interestingly, one of the, I suppose, the things I certainly didn’t see coming with respect to how the pandemic has played out is that, I think, there are a lot of agencies that have been quite profoundly affected by it negatively. They’ve seen a lot of 10 years’ worth of growth just sort of disappear overnight. And their turnover sort of be down into single figure percentage points about what it was the year before. And you would just assume that would be heartbreaking, and would be just a such a kick in the teeth, or the blood [unclear 0:13:13] and tears that goes into building an agency business like that, particularly an independent. You know, it’s kind of your baby in that situation. But actually, a lot of those founders that I spoke to were actually a little bit relieved. It was almost like there was a sort of a no-fault reset that had been imposed upon them. And I think that’s prompted, I suppose, a little bit more of a well-rounded view on what growth could be for the agency marketplace. And I think that kind of directly challenges the old view, which was that kind of growth for growth’s sake was ideal. And that success was about getting bigger. And it often meant that that was a kind of proxy for any kind of strategy. So you’d ask a chief: “Exactly what is your strategy?” All he wants to double in size. We want to be an X number of markets. Maybe we want to maintain 20% profit margin or whatever it’s going to be. And generally, these aren’t strategies. They’re just metrics or aspirations. And a lot of them are really just representations of ego rather than anything kind of structured than that. So I think the pandemic has encouraged people to think a little bit more deeply. I suppose about what success looks like for them. Do you really want to build a big agency? If you had a big agency last year, and now you don’t, is life worse for you or is it not? And of course, letting people go and seeing kind of disruption that causes in people’s families and mortgage payments, everything else is horrible. But in terms of the bigger picture, I think, it’s the road well-traveled. You know, you start an agency if you’re an indie, and you want to get some traction and stability, so you win a client and it’s brilliant. And then you win another one, and that’s amazing. And all of a sudden, you’ve got Five people, and that’s brilliant. And then you’ve got too much of your revenue coming from one client. It’s like, you share it with everyone that I’ve another big client. And then you do and that’s amazing. And then of course, you’re just on a path, then where you kind of consistently have to keep winning, because you’ve got more mouths to feed and bigger mouths to feed. And all of a sudden, you’ve built a bit of a beast. And you’ve got to keep sprinting just to stand still. And there is a huge sense of responsibility. You’re getting dragged from pillar to post. You’re working on the business. You’re attached to too many kind of client relationships. You don’t have time to think. And that I think is a lot of where that relief came from. So to not have to do that anymore, and to have the opportunity to build back the agency that you always wanted, rather than to just sort of be lumbered with the agencies that appears successful, that you’ve kind of found yourself with, sort of victim of your own success, I think potentially can be really positive legacy, because in a world where, you can start to build a meaningful strategy towards a much more carefully described outcome, which isn’t just about size and scale. But Matt perhaps speaks much more to diversity in the workplace, or a pleasant and inclusive place to be, or a culture around your employees, or an ability to really invest in them, rather than just resort to cliché about people are our most important asset, [and] all that stuff, which no one kind of... Those clichés, I don’t think people adhere to them, because they’re not good people. They’re just kind of the old rules of the game. And I think the more opportunity you have to challenge that, and build a good business, and for it to be a great place to be and for it to be fulfilling without you needing to be massive. I think, nothing wrong with being massive. And that might be the right choice for you, but at least it opens up a set of options for you. So again, yeah, very long answer. But I think the reality is that could and should be a lot of very positive legacies to COVID, both society and from an agency business model point of view. I also think people are smart and people are good, and they will make [and] there be good legacies out of COVID.
Jonny Dunning: 17:03 Yeah, some really interesting points there. I think when you’re talking about kind of agencies, almost running down the tracks or moving too fast, for the people that kind of build the agency, it’s very hard to focus on quality, when there’s that much quantity going on. And as you say, it can run away with itself. And I know exactly what you mean. So I guess when people are in as you put it a no-fault reset, then they are in a situation where they can maybe say, “Well, actually, we kind of got away from our values.” And that was something that was really important to us. And actually we can get back to... We don’t have to be 300 people. We could be 50 people or 10 people, and it could be fantastic what we’re doing, our values are. We’re doing great work. And we’ve got a really great culture, and we’ve got brilliant people, and we genuinely do care about our people and embrace diversity in all its forms. And also the kind of cognitive diversity of having different people from different backgrounds, coming up with great ideas and different ways of looking at things, because people have got different experiences in their different lives. And so just wanted to kind of link that into a point that I wanted to get your thoughts on, which was around accountability. So this is something that the organizations were doing anyway. They were just trying to get more accountable, more data driven, more metrics, more visibility on everything they’re spending. Certainly, this is a key area for procurement. Obviously, when they’re looking at their marketing services spend. But couple of points on that, firstly, you’ve got the procurement angle on it. And to be honest, we see this not just in marketing services, but across all services procurement, it is that COVID has a significant impact, where for companies, it’s not good enough to be to budget. You need to know what you’re getting for your money. And sometimes spend like marketing services can be a little bit more esoteric, harder to pin down, harder to say what you actually got from it, and all this sort of thing. And so there’s that side of the accountability, which I’ll be interested to get your opinion on. And then the second part of it is around things like values, diversity and inclusion, sustainability and stuff like that, which are becoming more and more important for end organizations in their supply chain as well. So how do you see those two factors? Have they been affected in terms of pure accountability being driven by the client?
Robin Bonn: 19:29 Well, that’s...
Jonny Dunning: 19:32 You probably have a one-line answer.
Robin Bonn: 19:33 That’s gonna tell one-line answer, otherwise, it’s gonna be a really long podcast. I mean, I think... I mean, I’ve got so many thoughts about this. Procurement, I think, is a discipline that is foolishly maligned by agencies. And I’ve thought that for a long time, and I said, in fact, I sent a letter to campaign magazine, I think at least 15 years ago, probably closer to 20 years ago, which kind of call them out on this. And I don’t think we’ve got much better if I’m honest, which is ludicrous. But the opportunity to engage with procurement and to understand from a kind of commercial perspective, what the drivers are of growth within their business, I think it’s a massive opportunity for agencies, leaders, marketing, new business people to really connect with the commercial agenda within their target client organizations. So I think particularly now, if there’s an increasing kind of focus about not just what we’re spending, but what we get for the money, obviously, that leads to a conversation about value. And I think that there is... Or many, many years, there’s always been this conversation within the agency community, magic and logic, you might remember was an initiative from maybe 15 years ago. And the sort of client and agency community trying to reconcile that there needed to be a sort of rigor and an accountability and a kind of commercial logic that sat underneath the kind of transformative lateral thinking, creative brilliance of the magic. And then I think, it was a sort of lovely concept, but I don’t really personally view that it was something that was ever really, I suppose, successfully reconcile. Because the two are kind of fundamentally different things. It kind of cut forward to now, I think we’re in a really interesting time, when actually, if you are an agency person who’s got their eyes open, there’s never been more encouragement, not least from the client community, but also from agency bodies as well. The IPA being chief among them. And huge credit to the leaders there. Mark Nor and the commercial groups within that organization to really get the conversation about value and pricing out onto the table. Also huge credit to client side bodies, like the WFA. I think, if you’ve seen project spring, which is an initiative out there, a global sourcing group, where it is the procurement community talking explicitly about the stuff you’ve talked about. They’re sort of evolving softer criteria that procurement people are increasingly looking for from their partners and suppliers, things like diversity, things like sustainability. So the agency’s credentials here are increasingly part of the conversation where the people that are going to spend the money. I think that’s a really positive kind of environment for us to start to talk about accountability and value. So the accountability thing, I think, is really interesting. And I think this is probably something that is not peculiar to the UK, but it’s certainly something which we are absolutely terrible for. This sort of peculiar sort of guilt ridden work ethic that we have. And I know that Bruce Daisley, who used to be senior at Twitter, and has a podcast and a book called, Eat Sleep Work Repeat, or something like that? Forgive me, Bruce. But it’s, it’s fascinating. He talks a lot about the nature of work and the workplace. And he has a view, which I’m going to Mangle now. Sorry Bruce, again. About us all having this sort of internal victorian mill owner, there’s little voice in our heads telling us that we’re kind of not working hard enough. And I think that is a sort of an awful guilt to take around with you, given that we all work bloody hard. Thanks very much. But it does lead into this horrible culture of presenteeism, which I think a lot of agencies are trying hard to stamp out. We’ve all been in offices where people would look at their watch when you dare to leave at 07:30, because wouldn’t it be nice if you kiss your kids before they go to bed. So 7 O’clock, part timer, and all that kind of core shit. We don’t need that anymore. And I think agencies are recognizing that we don’t need that anymore. But what the pandemic has done has proved that we can all be perfectly productive when we don’t have the man or the woman like peering over our shoulder [to] making sure that we get stuff done. So when we say we’re working from home, we don’t need to do the scare quotes now in the air to show that we’re working from home. I mean, of course you are. We don’t need to do that anymore. And that’s a lovely, I suppose, hammer to that present is presenteeism bullshit where you’re just there to be seen to be there. It’s also a great bit of positive self-talk to say to yourself that, “You know what, I got up at 7 O’clock this morning. I was at my desk at quarter past and you know what, it’s hour past 11, I’m going to have a cup of tea and a shower.” Thanks very much. Because I’ve done some good work. And it’s okay, you don’t have to be at it for 14 hours a day. So I think that’s a very good environment to recognize that it’s not how long it took or where you did it, it’s what you produced. So I think we’re in a position to have a much more grown up conversation about accountability, which I suppose leads into the conversation about agency pricing, what constitutes value and ultimately evolving away from some of the practices within agencies that are also supportive of a long hour, kind of commoditize working culture, such as selling time and materials, which people are poorly utilized and those monies are going to poorly recouped as endemic over servicing. Throwing was also a problem. And all those unsustainable business practices that the agency business has been carrying for since forever, but certainly been struggling to afford for the last 20 or 30 years.
Jonny Dunning: 25:54 Yeah. So, totally agree with you. The pandemic has absolutely show a light on the fact that it’s not about where you do it [or] when you do it. It’s about what you do and then it’s done to a good standard and in time that needs to be done. So it’s all about outputs, outcomes, productivity. However, you want to kind of phrase that. In an environment where you can get away with the whole kind of presenteeism, time and materials, bums on seats, people just being there, and being an office and think things have rolled, well, there are lots of people here, and they all appear to be doing something. Therefore, it must be all great. For me, it ties into this overarching problem, which links back to what you do, really, which is about strategy. Because I think organizations are having to overcome these hurdles now, partly because of COVID. And there’s just been this focus on what are you actually doing. Procurement teams saying what I’m actually getting for my money, and wanting to really get visibility on that. We see that with people using our technology all the time. They know what they spend, but they want to know what they got for it. So there’s a hurdle for companies, because they’ve got to define what they’re going to do. And the company that is engaging in needs to define what they do. And clearly, that should be part of the process anyway. But I think there can be some laziness, when it’s not really outcome driven. Whereas if a piece of a requirement is really outcome driven, there might be some change along the way. But you’re clearly saying, I’m going to pay you X to do why everybody’s clear about that. And then if we can do it in the most efficient way, the company is happy. They’ve agreed to pay a certain amount; they know what they’re going to get for it. Their strategy needs to be lined up, because they need to know what it is they want to do, and how that fits into their overarching strategy. Very important, they communicate that correctly. And therefore, the marketing agency needs to have a clear understanding of what’s required about them in a particular project, and across all of their projects and programs. And therefore, they need a clear strategy as to how they’re going to resource that, how their organization is going to be structured and managed to deliver that. So when you look at that from a kind of analytical, scientific point of view, it makes a hell of a lot of sense. But there are definitely some hurdles for the agency world and clients to adapt to that. What do you think...? You talked a little bit about the perception of value, and this kind of... Well, I guess, it sounds to me, like wholesale mismanagement of time based working. What do you see as the major things that need to change in that, where the big problems are, where agencies are losing money, and they’re not delivering and clients aren’t happy and agencies aren’t happy? Where are the pain points?
Robin Bonn: 28:40 I mean, where do you start? I mean, if you accept that agency, businesses are largely driven by people, as opposed to proprietor IP or machinery or software or anything else. It is still inherently a people business. Arguably, the biggest sort of symptom of the disconnect you’ve just described is the talent market. I mean, even sidestepping, an enormous challenge around diversity in all of its forms, any study you’ll pick up will show that the level of diversity in mainstream agency land is nowhere near where it needs to be. But just the challenge for finding good people, keeping good people, making sure that great talented, creatively minded people are not going and finding more attractive, more glamorous jobs elsewhere, that I think is probably the biggest [and] most pressing challenge, I suppose. And you can see that left, right and center that obviously, so many agencies are having to run very lean now, because it just isn’t enough money in the system. There’s a lot of very junior people with the greatest of respect. You’ve got very big job titles. A lot of very senior people have been kind of let go and it’s effectively a race to the bottom, which needs to be stopped. And I think we are starting to see more change on that front or consolidation of big agencies, more sort of explicit strategy and more specialization within all agencies, just a little bit more focus, a little bit more strategic clarity that allows them to stop trying to be all things to all people. So I mean, that barely scratches the surface of the challenges that you’re talking about. I think the question of value is another big one. In my opinion, I think when you’re looking at the biggest hurdles, whether it’s individuals or agencies or businesses, any organization at the biggest hurdles that you have to change is often language. So just simply, everybody having a shared understanding of what it is, that’s the problem. You just lean into so many clichés with this kind of broad conversation. But the idea that you’ve got to define the problem before you work on the answer, I think is critical. So when we’re talking about value, we don’t really talk about what value is. I think a lot of agencies defend their sort of presumed seat at the top table within business in very vague terms. A lot of the advertising agency community talk about creativity, as if it’s sort of value is kind of explicitly obvious. And I wouldn’t think that the majority of footsie 100, chief execs want to see an invoice with the word creativity on it. They want something far more commercial. So little bits of language like that. And value is chief among them. And I’ll give you a very specific example of this. I think when we talk in agencies about resolving some of the issues we’ve talked about, whether it’s about hiring better people or keeping them there, it comes down to money. So why isn’t there enough profitability within agencies? Well, there’s lots of reasons for that. So let’s talk about pricing. Okay, great. That must be the solution to that. Let’s find a way of charging more and kind of allowing that to inform a more efficient operating model. Great, okay. Well, let’s look at some more entrepreneurial pricing. Let’s look at value based pricing. Okay, that’s great. So if we can get paid more if we achieve more, then that allows us to be entrepreneurial, that should be appealing to the client. And that’s a sort of logical path that is as old as the hills, but it’s also really flawed. And for that reason, the conversation about value gets stalls before it even gets off the grid, because the idea of value being so connected to payment by results is a pretty flimsy connection. So when you say, “value based pricing”, a lot of agency people they hear and equated to payment by results or performance related pay, where there is skin in the game. And if you scope out a piece of work and if you overachieve against certain outcomes, then you’ll get paid more. And if you don’t quite achieve them, you will get paid less, which when it works is great. And if you’ve got certainly a performance marketing agency, where the metrics are clear and your attribution model, if not perfect, then at least workable, and it certainly makes sense. But for everybody else, there’s always a sort of sudden wringing of hands saying, “Well, we’d love to do payment by results or value base pricing, but we can’t, because the client won’t give us access to the data or [unclear 0:33:35] also quite rightly say, all the clients a bit nervous about not having certainty of budgets, so if we over achieved, they’ve got to find more money from somewhere. So both on the client side [and] on the agency side, this sort of great hope for improving profitability in a really entrepreneurial win-win type way to help improve the business model, as I say, doesn’t even get off the starting blocks, because it’s sort of rooted in this assumption that it has to be based on sound attribution of variable pricing. And that’s nonsense. They’re just different disciplines altogether. So selling on value and being in a position to tailor what’s in a statement of work for a client, it’s a completely separate discipline to any kind of performance base aspect to it. So we’ve touched a little bit about selling outputs, which is certainly an option, as opposed to time and materials. You know, you can talk about value in terms of exactly the same metrics from a brand point of view or from a sales point of view; all those kind of metrics that you might attach to payment by results. They’re perfectly sensible things to put a price against. They don’t have to be variable prices. It doesn’t need to be skin in the game. The whole avenue here, which is sort of opened up to agencies and to clients to consider about the commercial relationship between them. If we suddenly disconnect the idea that value and sort of skin in the game, if you like, are one and the same thing. So that just one small example of how language massively gets in the way.
Jonny Dunning: 35:20 So when you’re when you’re talking about selling value, and in a previous conversation that we’ve had, you’ve mentioned kind of frustrations around the idea of selling value, but the fact that people are pitching commodity, do you mean specifically around things like performance marketing? Or when you’re talking about pitching commodity, what do you mean by that?
Robin Bonn: 35:42 I think that it’s an interesting way you phrase that because for me, pitching is a symptom of the commoditization of agencies. And I think a lot of agencies see it as the root cause of their commoditization. And so agents people will often whinge about the pitch process. And people outside of UK are absolutely staggered when they hear that we wouldn’t dream in the UK of asking for a pitch fee from a client. And that amazes them. Now, whether you think the agencies that will be paid for pitches or not, that’s a whole other conversation. But the idea that there needs to be some kind of selection process or beauty parade as a means of clients making investment decisions, seems perfectly sensible to me. I’m certainly not anti-pitch in any way, but the idea that it’s a sort of monolithic sort of engagement with a client where they hold all the cards, is nonsense. You’ve got a huge amount of authority to input and influence that process as an agency, but that is something you need to commit to. And in very simple terms, if you’re not a differentiated agency business, you’re gonna have much less influence in the way that clients are prepared to engage with you and buy from you. I have a very often used analogy between GPs and surgeons, which kind of emphasizes the point. If you move into a new house, and you need to sign up with a local surgery for your GP, then you probably don’t think too much about it. You go and do a bit of Google search, find out where the local surgeries are, and you find the one that’s closest to you and/or the one with a gap and you sign up and you don’t worry about it. And then if you go and visit that GP, I don’t know, three times in six months, and the experience is pretty rubbish and the GP is a bit disinterested or they’re a bit rude to your kids, then you think this is rubbish. I’ll just go to the GP that’s 100 yards further from the house. But it’s not particularly high engagement decision, because the expertise that that GP has, is pretty broad. And that’s kind of the job or clues in the name, general practitioner. Now, if you contrast that to, if you had a much more acute problem and you needed surgery on it, then you would probably engage the medical profession in a very different way. You would certainly search, probably, much harder. You’d think much more clearly about your criteria. You would probably travel further. You might decide to pay more. And if you then eventually found the right surgeon for you, and you had to go through whatever waiting list they decreed you needed to follow, and you met them, and they were sort of just as lacking in bedside manner as that GP was, [then] at that point, you would take it on the chin. You wouldn’t say, “Right. Forget this. I’m going to go and find a different surgeon.” Because obviously at that point, you don’t have many options. You’ve got a problem that needs solving. You’re in front of an expert. And the fact that they are a bit snippy with you is just much less important than it was when you’re with a GP. So for me, the read through to agencies is super clear. If you can provide something to the marketplace that solves a problem that clients are acutely facing, then you’re in a much better position to have bargaining power when it comes to the way that they choose to buy from you. And you’re never far from a dating analogy either. It’s not quite treating mean keeping keen, which is a horrible phrase, best of times. But it is a sense of being able to exercise some degree of control over the way that people interact with you, as opposed to just being told what to do by the client. And again, you mentioned procurement at the start, has found this really interesting. So the sort of agency perception of procurement as these kind of aggressive Rottweilers that will sort of force you to do things you want to do and force you to sort of take margin out and force you to show your overhead recovery rate and all that kind of stuff, it’s just their job. And actually, I’ve met plenty of procurement people since not being an agency person that I’d met before, and of course, they’re nice as pie. And of course they are. And actually, they’d rather if agencies put up more of a fight in their situations, because all the things that agencies think they can’t do, if you ask procurement people privately, they’d be more than happy to accommodate. So sharing rate cards, for example, is a case in point. If you say to an agency person, “Well, when the client asks you for a rate card, what if you said you didn’t have one?” Oh, my God, we can’t do that. That just throws out the process. Would they? Are you sure? And actually, that’s not necessarily the case. You know, it might be the case. But again, if you’re differentiated and they recognize the value of what you do and your expertise in solving that acute problem they face, then they might well open a conversation with you about how do you handle kind of the commercial arrangements, and then you’re much more in the driving seat, and you can tell them how you do it. And if they don’t like it, that’s okay. There’s more clients in the world. They can go and find the right agency for them. That’s no problem. I think we’re all sort of conditioned in mainstream agencies to believe that we must be the answer to all of the client’s problems, if only they would believe it. So we’re far more in the persuasion gaming agencies than we should be. We should be far more than the kind of: “Look, this is what we do. This is what a great at.” And it sounds like that’s probably not quite what you need. So we’ll step back now. Cheers! Best of luck with it. As opposed to, let’s find a way to service the client, which is a very dangerous sort of ethos that leads you towards some of the more the symptoms of commoditization that we’ve already touched on.
Jonny Dunning: 41:48 Yeah, and I think, you know, what we’re discussing, there would be music to the ears of most kind of forward thinking procurement people, you know, procurement people are much more focusing on value rather than costs these days, that does require the right data, it requires you to engage in a process in a structured manner. So you can actually assess these things. And it but it changes also the engagement, the spirit of the engagement, you know, if a supplier can demonstrate, or convince, you know, with good empirical evidence, good evidence, good case studies, or whatever it might be that they can deliver the value that they’re saying they’re going to deliver, obviously, that’s, it’s a benefit. If you’re a specialist, there’s more credibility around that more of a laser focus on what you’re actually going to be doing. And you’re not trying to just kind of like, broaden out and solve every problem they might possibly have, then the procurement person’s point of view is going to be definitely going to be skewed towards wanting to capture that value for their organization, because that’s their job, their job is to make sure that they’re getting the best value for the money to spend engaging the best suppliers. So when it comes to actually defining value, whose responsibility is taker, taker, a second in fictional engagement? In terms of defining the value of that engagement? How much of that should sit with a client? How much of that should sit with the agency?
Robin Bonn: 43:14 Well, I think it’s a collaboration. And I think that’s, again, sort of the answers in the question. I think, if you are an agency that thinking back to a guy used to work with many years ago, and forgive me for all the Australians in the in the accent, but he said, and this was beautifully, shrew said, said, You’ve got to make the brief don’t take the brief. And I thought, that’s bang on. And part of that is about having a different kind of conversation earlier with clients, to getting upstream, talking to senior decision makers, starting to uncover shape, and define a need, as opposed to constantly sort of looking for business very much at the point of demand, where there was a pitch brief, you know, there was probably some very tightly, you know, tight procedural guidelines around that process to ensure, you know, probity and fairness. So trying to break those constraints at that point is much harder than having the conversation earlier. But you know, to what degree agencies really work hard to have those upstream conversations is a whole other conversation. So if you are in a position where you can have a meaningful conversation about the size and shape of a brief, what value looks like how to get everybody’s, you know, incentives pointing in the same direction, then it should absolutely be a collaborative engagement. But I think, you know, when you put it into a competitive context where the agency is on the back foot, I feel like they’re one of six. And again, this is an anti-pitch, but when you’re trying to have those kinds of progressive conversations, at that point in the buying journey, then you couldn’t pick a harder time to try have those conversations with the client, which is and again, we talked about this before, why agencies don’t reach out and talk more proactively with procurement and get these conversations going, and use that as leverage to really understand the commercial drivers behind the marketing agenda. You know, it’s beyond me, I tend to be on me, it’s it amazes me that more, don’t do it. But I understand why they don’t. Because they see that sort of, you ask an agency what its sales strategy is, and they generally don’t have one. It’s more about pitch conversion. And, obviously, that’s a sort of the sharp end of the sales cycle. That’s not the whole sales cycle. So I think going back to the surgeon analogy, if your agency is set up to solve a discrete problem for a specific audience, then you have a tightly defined use case that you can then reach out to clients that best fit that set of criteria. And you can have productive conversations with a manageable number of prospects, and you can start to have these upstream conversations. Again, this is another one where language gets in the way. As soon as you click agencies hear things like specialist and solve a problem and discreet audience, they start thinking oh, well, that means a single discipline, or it means you know, a single vertical sector that we work in, doesn’t mean any of that stuff could do nothing wrong with those things. But you know, specialism could be big, you could argue that the four, you know, big holding companies are specialists in servicing the, you know, end to end needs of global advertisers. perfectly reasonable. You know, you could argue about the level of differentiation between the WPS and the under concept as well. But in terms of their competitive set, I think that’s a reasonably well defined marketplace. And yes, there’s smaller independent sort of snapping at their heels as client demand is changing, and the nature of globalization is changing. But the reality is, the specialist doesn’t mean small. But if your business is specialized and tailored, then you can design an entire business model that allows you to win more of the kind of work you want to do from the people that are most likely to buy it using the kind of sales cycle that speaks to your mutual benefit. Which of course leads you back to the point you raised, which is about having a peer to peer conversation about whether you’re the right fit for one another, not trying to persuade the client that you definitely are. And then for having a grown up conversation about where the value is going to come from.
Jonny Dunning: 47:25 Yeah, it’s just that consultative approach. And being good at solving a particular problem just has benefits all round, it has benefits for the client. You know, it’s much more definable in terms of what this what this supplier is being brought in to do what their area of expertise is. And therefore it should, by the very nature of that be easier to define the type of value that you’re going to deliver. You know, procurement people want to be able to, to measure what’s being delivered, we paid x, we’ve got why, how does that stack up? What’s the return? How is that impacting the rest of the business? You know, there’s so many cool things that procurement Can people can do with the data that they have, in terms of looking at external influences, insert internal goings on feeding information up into the C suite to say, this is working really well, we think this is driving x and y. But it’s only as good as the data they’ve got. And that data to a certain extent, is only as good as the relationship and the depth of the relationship they have with their suppliers.
Robin Bonn: 48:21 I mean, on that point, I suppose to argue the agency’s cause a little bit. Again, I probably spend most of my time being sort of critical, or at least challenging of agency people and suggesting they take more responsibility for the situations they’re in, which I think is reasonable. I think the other side of the coin is as much as I would defend the agency community.
Jonny Dunning: 48:55 Thought I thought we were gonna get a third member of the conversation, Rick, come on in. It’s the it’s the you know, the kind of COVID normality, isn’t it? just invite them in? Exactly. Exactly. But you so you were saying you were saying that you were not wanting to be too harsh on the agencies themselves. Yeah. So this is a point about procurement. So value defining value defining what’s going to be done. I just think it’s easier. If somebody comes in and they’re a specialist, it’s easy to define what they’re going to do. It’s easier for the client, the client has to have a clear understanding of what they want to be delivered at the outset. And that is part of that is definitely partway towards the solution for this value based approach. If they’re a specialist, they can fit into that gap more effectively, you can define it more accurately is not trying to creep into everything, which is where it becomes very, very vague. And also, I’ve hijacked your point a bit here, but I bet you come back onto that in a second. But I think there’s some really interesting things to look at as to how Those well-defined outcomes flow down into the workforce and help that workforce. Anyway, back to your point about on the looking from an agency point of view.
Robin Bonn: 50:10 Yeah, I suppose if we’re talking about procurement and value and, and data in particular, the sort of the opportunity is for, you know, smart, progressive procurement people and smart progressive agency people to be able to align around clearly defined outcomes, set up the right incentives on both sides to get there. And that that feels like, you know, a perfectly sensible, an agency, people do whinge about procurement a lot. Still, it’s depressing and counterproductive. But having said that, clearly, we’re good agents, people, bad agents, people that are good procurement people and less good kind of procurement people. So, you know, historically, the difference between procurement that come from a direct sourcing and indirect sourcing background, those that reporting to the CFO, rather than into, you know, a CPO. You know, those are the sort of broad brush kind of distinctions, that I think that certainly carry some weights in terms of the kind of incentives that that procurement person is going to be working towards. And I think there’s plenty of examples where, you know, a procurement person is being assessed in whatever way or incentivized in any way to, you know, in effect spend less than last year, or to achieve some kind of saving against a set of needs, that may be very different to what happened last year. And then if they are motivated to do that, and have no great accountability for the quality of the outcome, then clearly, that’s a massive breakdown in the alignment of incentives between the marketing department and the agency. And, obviously, therefore, the, you know, the procurement drivers as well. So I suppose just to recognize that there’s more work to be done, I think on all sides here, we shouldn’t leave the marketing team sort of out of that as well. I think having a better sense of the important role that procurement play to guard their interest and to guard the commercial interests, you know, shouldn’t be kind of glossed over as well. But yeah, I think the opportunity for I suppose people that are, have mastery of what they’re doing, to come together to find a route forward that suits everybody. You know, that should be the starting position, rather than, you know, the kind of the happy, occasional confluence of agendas. I think a lot of that comes down to clarity. So in this instance, obviously, we’re talking about marketing agencies in the broadest sense. So if the marketing client has got real clarity over what it is that they’re trying to achieve, whether they reach that clarity in combination with a consultative, smart, strategically minded agency or not, but as long as that agenda is clear, if the potential agency partners they’re considering have got demonstrably expertise in doing that, then that’s a great basis of a fit, as opposed to, we’re pretty sure we want agencies that can kind of do this stuff. And agencies that are like, yeah, yeah, we can totally do that course we can, and then get back to the office and think Christ, we’d never done that before. How do we do it? Now we’re trying to squeeze the entrepreneurial ism and the kind of, you know, essential optimism out of the business. But it’s not a business model. And I think that’s been a challenge for agencies for a long time, the sense of like, the answer’s yes. What is the question again? But it was definitely yes. That’s certainly a concern. So yeah, again, it’s a sort of the such multifaceted challenges that touch on so many of the you know, the sort of strategic and structural and, you know, sort of behavioral and mindset norms within these different groups of stakeholders, trying to unpack them within the context of one answer is really tough.
Jonny Dunning: 54:05 It is, but I think you made a really good point there, when you were talking about, you know, marketing departments for sale, facilitating the involvement of procurement. But also they need to recognize the benefits that procurement can bring to them if they can, if they can actually get them involved. You know, procurement people aren’t there to say no procurement people are there to make sure that the organization is getting the best value for the spend working with the best suppliers delivering the best outcomes that actually push the business forward. It’s a central crucial role within the strategy, overall strategy of an organization. But if they don’t have the information, all they can work to is budgets, and some kind of fluffy criteria around the outside of it, but if they can actually, you know, surely marketing departments would actually like it. If procurement were more able to get involved and could actually help them drill down into the value Because ultimately, they’re being driven towards objectives as well. So if everyone’s able to get more visibility on actual outputs, outcomes value, then that in that it will enable that organization to continue working with their best suppliers, maybe even increase the work. They’re doing their best suppliers, rather than just saying, oh, guys gotta have a budget cut, because things are tough. If you can actually say, well, this agency, are delivering massive returns on value. And we ask them to do this, they did a really great job of it and delivering these results. That’s something that procurement can fight the case and say, Well, actually, we should be spending more money on that because the objective is to drive returns. And that’s certainly something that’s going to appeal to the CFO, the CEO, CPO. However, that kind of filters through.
Robin Bonn: 55:45 I think that’s really interesting. So one of the, you know, we sort of positioned marketing and procurement and agency as a sort of, you know, as three points of, you know, on the triangle, if you like, but actually, when you start looking at the incentives between them, I think there’s huge alignment between the marketing department and the and the agencies. So, again, if you follow the agency press, there’s a lot of talk, you know, certainly at the moment, but there has been for a long time about, you know, the value of creativity in all its forms, and, you know, the opportunity for agencies to regain their seat at the top table, and to be the trusted adviser of the C suite. And all that kind of, I suppose rhetoric, which I suppose implicitly points at a concern that they’ve kind of lost that over the last 3040 years, and that management consultancies have kind of come from nowhere, and are able to command a much higher premium and provide much higher level advice, which I think broadly is undoubtedly true. So how do agencies get the year of the chief executive is a thing. And I think at the same time, marketing has been sort of trying to sort of fight its corner for a long while along the similar sort of lines. And as much as you know, they want to be perceived as fluffy. They want to be perceived, as you know, the coloring in department and all of these unhelpful clichés which you hear.
Jonny Dunning: 57:09 I’ve never heard that one before. Which is why maybe chuckle but yeah, it’s, it’s unfair, at the very least.
Robin Bonn: 57:15 But again, you know, if, you know, if you look at the sort of rise of digital media over the last 20 years, you could argue that the sort of marketing agenda has sort of swung back sort of too far the other way. And it’s now almost super numerous. And, you know, investment in brand has perhaps been diminished. And an appreciation of brand within client organizations is perhaps not what it was, I think the certainly a risk aversion now, with sort of mid-level marketers were. So there was a ring brought up with the accountability or presumed accountability of digital media, you really start getting into the efficacy of, you know, programmatic spend, and you know, how much your ads have actually been seen by the right people, but the perception of accountability by being able to spend this and getting that, you know, as I say, perhaps it’s gone too far the other way, but sort of putting that to one side, the idea that marketing hasn’t got the credibility within the boardroom, that it should do. And agencies facing the same challenge. There’s a big overlap there and their agenda. And you could argue that procurement effectively is the key to the door for both of them. Because if you can get that, that alignment between those three groups, then you know, procurement effectively bring the commerciality that if we’re being unkind, the more kind of bigger picture creative aspects of marketing lacks. And I think again, we can certainly say that, generally speaking, that level of commerciality is lacking within agencies. You know, I spoke to a friend of mine recently, a guy called James Bond’s Austin, who works for a consultancy firm called Sherpa. And he was part of the calmer armor agency when they sold to Accenture, so he would know but the idea that he mentioned when we spoke recently was he put it so clearly said the reality is that clients are professional buyers, and agencies, amateur sellers. And going back to the start and me working in selling computers when I was 21. You know, I learned stuff there that would never get taught in an agency. That’s why sales is often a dirty word best agencies or marketing organizations. So yeah, there was a lack of commercial knouse. That’s absolutely endemic. And, you know, the vast majority of agencies, and of course, clients, they do this stuff every day, which is why procurement are sort of seen in this sort of big bad wolf context, when actually they’re just, they just know how to negotiate and they know how to put pressure and they know to recognize the implicit signs of agencies being on the backfoot. You know, when you put a cost proposal in, and it takes you two weeks, and it’s a mess when it arrives. You kind of know the agency’s winging it, whereas if agency B put some methodology on your table You know, as a procurement person in a day, and there’s a clear process to it, and next steps identified in terms of how to work together to refine it, you think these guys have done it before? I mean, it’s not. Agencies are pretty sort of transparent when it comes to, you know, when they’re winging it to a trained eye, it’s pretty obvious. And that’s why that lack of commerciality holds them back. Anyway, back to the original point, you have a real opportunity for marketers and agencies to embrace procurement to build a commerciality into the arrangements between them. Where value is clear for all and that will improve everybody’s day.
Jonny Dunning: 1:00:42 Yeah, you make some great points. I like the point you made around the marketing agencies needing to align with marketing departments effectively be an extension of those marketing departments. I think that’s always going to be called into question. Because it can, it can on the very kind of vague surface of it, it can look lazy, I was just more capacity. why don’t why aren’t you? Why aren’t you getting your team working hard, why and your team doing more of this. So I think the more that that shifts towards outcome based delivery, the less confusion there is about the value that’s being delivered. It’s like when you’re talking about everyone having to work from home and stuff like that, you know, with the whole working from home, I mean, you know, I’ve spoken to large organizations during the pandemic, where they were, there were, they were having difficulties with this. And part of it was how do we know people are doing what we need them to be doing. And maybe that’s just because normally everyone’s just while they’re in the office from, you know, eight till six, or whatever that is, that’s seen as a proxy for them doing what they’re meant to be doing. When you actually drill into it. If someone’s got to manage childcare, if they’ve got to manage other no pet, or they, or their, or they’re dealing with distractions in the home, or, or having to pick people up whatever it is, during the pandemic, they’ve had to do what they need to do, and fit it in themselves. Some organizations that I’ve spoken to have even considered things like, you know, screen tracking and stuff like that, say, Well, you know, are they at home? Are they just watching Netflix? For there could be it could be the green green lines on teams, but they’re just watching Netflix. But actually, if you just judge people on productivity, that’s far more effective. And it’s far more fair. And it kind of takes me back to the point I was making about flow down. If you’ve got clear objectives, I think people like individually working to clear objectives. And if agencies want to attract people and retain people who, particularly if they’ve got specialist skills, then if they know that they’re going to actually deliver an end product or an end point, or you know, an output, that’s, that’s something that just works a lot, a lot better for a lot of people in terms of actually just getting satisfaction out of what they’re doing. And so coming back to that extension of marketing department, I would argue that there’s certain work that’s going to be, there’s always gonna be very difficult to take away from a 10 basis. But there’s other work that absolutely can be far more outcome based. And it would suggest to me that that would be better in some ways, or round, where is the right way to do it the best way around, because the marketing department know what they’re getting, they know what they’re paying, they know what their value they’re getting out of it, procurement can see it. And the agency actually know what they’ve got to do. And if they’re organized, they can deliver that effectively and efficiently. Without just having this complete overstaffing scope creep scenario, which creeps in a lot of time.
Robin Bonn: 1:03:33 Yeah, again, there’s so much in that I think we’re back to the nature of expertise, you know, if you are doing your expertise is about doing something consistently and getting good at it. And even those kinds of that kind of language, worries agencies, because the idea of feeling constraint and only ever doing one thing, you know, that’s a nonsense, you know, is if you can’t be really, you know, broad and innovative in your approach to solving a big problem, you know, whether it’s globalization or whether it’s, you know, brain surgery, you know, there’s, there’s no limit to the breadth of which you can apply to solving those kinds of problems. So bringing the, the, you know, the sort of depth of knowledge that working consistently on related things brings to you allows you to get good at doing it, which allows you to get good at knowing the cost and therefore being able to price it. So, you know, there’s nothing wrong with TNM. And you’re right, and probably certain kinds of tasks are sort of better suited to it. I think most of the progressive voices around pricing and agencies are not advocating the death of TNM. They’re just advocating having a richer suite of tools in the pricing toolkit at your disposal place right time, isn’t it? Absolutely. Absolutely. But of course, if you don’t have people that are trained to understand the differences between them, if you don’t have permission as an agency, through your differentiation to earn the right to have a different kind of conversation about pricing with the client, you know, your opportunity to change that ultimate commercial relationship is much diminished. You know, a commoditized agency with a 23-year-old senior account director who’s had no training around the difference between outcomes and outputs, is going to struggle. Equally, if it’s just the FDA that does all the pricing, because she’s the one with the knowledge puts an awful lot of pressure and a single point of failure and a single attitude towards the right or wrong way of doing stuff. So there’s loads of kind of organizational kind of change that needs to happen commercially within agencies from a mindset perspective for structure, process, responsibility, roles, training, all that good stuff that needs to sort of stack up behind this. But yeah, there’s nothing wrong with TNM. There’s nothing wrong with, you know, fixed prices for outputs. And in essence, because there’s this sort of Chuck resource at the problem mentality with an agency’s time and material should work in the agency’s favor, because the risk should sit with the client. This is how much you know how much time we’re going to spend on the problem. And if it doesn’t get fixed in that time, then you’re going to need to buy more time from us. And that’s how lawyers work. But lawyers are able to monetize every hour they spend, because you take it as read, even when you can’t see them, how much time they’re spending in those six to six minute increments, they will be charging you for then you pay the bill and you grumble in the pub and you move on. Whereas agencies don’t have that backbone, you could argue they don’t have the professional kind of credibility if you like to be able to do that either. So when you offer TNM, what you’re actually offering often is here is a fixed price. Yeah, we’ve will tell you how many hours and what those hourly rates are to go into it. But basically, we’re going to deliver what we’ve said we’re going to deliver. And this is how we’ve come up with the price, which is the worst of both worlds. So effectively, it is a sort of de facto fixed price deliverable. And yet, you’re showing all of your homework. So I don’t know why that information needs to be shared with the client. And I think if they’re on its most procurement, people would argue that they don’t really need to see it, either. They just get it because it gives them more leverage in a pricing negotiation. So he could when it comes that explicitly selling outputs, you could argue that, you know, just another proxy for benchmarking, we’re okay, if we can get 20 social media posts off agency a for so much money. And for the same money, we could get 30 social media posts off the next agency, it has a commoditizing downward effect on pricing, because you’re still trying to take the subjectivity and the perceived value out of play by presuming that in the first case, you’re presuming that one creative director, you know, two grand a day is the same as a creative director 1000 pounds a day, that’s nonsense, equally. In the second example, we’re assuming that those 20 social media posts are equal quality of the 30 social media posts. That’s nonsense as well. So you can’t take the subjectivity out of this stuff. So ultimately, it boils down to can we deliver what we said we’re going to deliver. So what’s the outcome we’re trying to achieve? And that could be something as benign as an idea being signed off at board level, that’s an outcome, it could be something as far reaching as an improvement in the share price, or you know that the agency has no direct control over or, you know, improvement in Net Promoter scores or whatever other outcome. That doesn’t have to be a performance related aspect of that. But if the client hires you to put 10% on the share price, and you think that’s a good thing to do, and you think you can do it as an agency, and you scope it out together, you agree a fair price for it. The agency knows its costs and doesn’t have to share them. It should be a win win. Now, if the client thinks that’s worth a million quid, or 10 million quid that’s up for the negotiation, you can work that out, doesn’t need to be a question of how many hours you know, and the perceived value of the people that are put in at those hourly rates. The ultimate failsafe it’s just like democracy, if you don’t like the government, vote them out. You know, might not be perfect, but it’s the best system we have. And the same thing if you don’t get the share price increase. If you think it’s the agency’s fault, fire them. And if it’s fair, they’ll think Okay, fair enough. They think they’ve been harshly treated because the products are dog and, you know, they’re selling barbecues and it rained all year. They’ll feel hard done by, but it doesn’t change the fact that that’s how it’s gonna end up. It’s a bit like gig tickets. So there you go. If you love music, you buy a gig ticket and you hope to have a good time. If it’s a big name, you maybe pay more money for the gig ticket. And you really, really hope you have a good time because you spent more money and there’s a reputation to behold. And if it’s a ship gig, you’re disappointed as hell. Whereas if you spend a fraction of that money on a gig ticket for someone you barely heard of, and then they blow you away, that’s amazing. But you’re still, we’re still a leap of faith, you decide to pay money based on your perception of the value you’re gonna get. And if you’re happy, you might do it again. And if you’re dissatisfied, you’ll do something differently next time. That is ultimately what it boils down to when you’re dealing with subjectivity.
Jonny Dunning: 1:10:39 Yeah, and like you say, if you can, if you can, actually, if you can effectively package it up with the allowance for the subjectivity involved in this type of, you know, often creative process, then you’re still, you’re still working to an outcome, you’re still saying, we’re going to do this, and we’re going to, we’re going to price it like this. And the client is accepting, saying, well, that works for us, if you can do that, for that price, we’re really happy with that. Great, then it’s down to the agency to deliver it and to make that work for them commercially.
Robin Bonn: 1:11:11 But that’s how it works in most, most of the scenarios. Exactly, you know, your cost, how much your airline is paying on fuel. You know, it’s just okay, if it’s going to cost me two grand to get across the Atlantic, or it’s going to cost me 700 quid or 300 quid, I’ll pay my money. And I’ll, I’ll take my choice. I think it’s in fairness to clients as well, I think there’s probably a lot of pushback here from the agency business model, where certainly the network agencies, they really value the predictability of revenue over lumpy profit. Yeah. And I think offering a variety of pricing mechanisms, which may be have the potential to create a more profitable Win Win, like the one we’ve just described. It makes reporting difficult, it makes, you know, the management of their expectations, and the reporting back to their shareholders trickier, because that’s just not how they’ve been sort of set up to operate. And I think that is a massive cultural and structural impediment to a richer, more commercially informed, flexible conversation with clients.
Jonny Dunning: 1:12:17 Yeah, and it may mean that we see agencies taking a slightly different shape, if that becomes more the kind of normal way of doing things, or it may be that that’s only certain types of client wants want to do things that way, or only in certain areas. But I think the bottom line here is that, within that process, procurement don’t want the supplier to fail. You know, in 99.9% of cases, unless there’s some sort of personal, you know, disconnect, where people just really don’t get on with each other personality clash, and procurement. And if they’re professional anyway, that that’s, that’s neither here nor there. But they want the supplier to achieve their objectives. They want them to do a great job. And because then they’re in a good position that, you know, the business is working well, marketing are getting what they need. It’s money that was well spent, they did a good job in helping procure that service. So. So yeah, people, you know, people, if people go into it with a mentality that everyone wants this to work, and actually everyone benefits from it being a good outcome. And then that’s going to go a long way towards it. But as you say, it’s very complicated, but then says the current situation is very complicated, where you have disorganized TNM and cost overruns for the client, lack of profit for the agency, lack of kind of measurability on what’s actually happening on a day to day basis. At what point do you know it’s gone astray? Whereas if you work into outcomes and milestones in particular, then you’re kind of breaking down, and you can see it in real time. And so, yes, there’s Yes, there’s mileage to get to the panacea, but it’s not a perfect situation at the moment. But I think it’s a really interesting opportunity, that, that I think, really the last couple of years has definitely opened this up as more of an option.
Robin Bonn: 1:14:02 I agree with you. And I think, you know, the agencies being more focused, there being a more kind of holistic commercial conversation within those agencies can only help reach that kind of outcome that we’ve that we’ve talked about, kind of more informed, more peer to peer, more constructive, aligned relationship with, you know, marketing and procurement. It’s, I just don’t see any other way of them successfully doing business, moving forward, then starting to adopt those kinds of approaches. And as I say, I hope that COVID can be an accelerant to a different kind of conversation. And, you know, a more mutually beneficial one, or to your point, you know, everybody wants the same thing at the end of the day. And I think we can talk about incentives and alignment and procurement being incentivized by cost saving versus outcome and those things do need addressing but you know, it’s a bit like when you go and watch a stand up Media know, once a comedian to bomb because it’s an unpleasant experience for everybody. And it’s the same thing here, everybody involved with, you know, this conversation wants the brand, and the business to do well, you know, clients want agencies to make enough margin to build good businesses to be able to deliver great work. You know, nobody’s suggesting agencies wants to be profiteering so getting giving good value for good money. And that seems perfectly aligned with what procurement should be, you know, aiming for. And, of course, the agency’s kind of criteria applied to the, to the marketing client as well. So it just shouldn’t be beyond the wit of man or woman to be able to create a sort of tripartite relationship where everybody is mindful of this, I think you made another really good point as well, which is, you know, it’s easy for me to sort of glibly talk about, well just pay as a million quid, and we’ll increase the share price, or call it 2 million, or 10 million or whatever. It’s not an all eggs in one basket point. So, as you said, sort of staging deliverables and having a journey towards that, where, you know, there is a degree of commitment, but there are, you know, the protection from a client side to be able to get out and agreement, if it’s not working, you start small, you build a relationship, you trust one another, and away you go. It doesn’t have to be a, you know, sign up for three years, obviously, there are certain, you know, projects that weren’t necessarily war on that kind of commitment, whether it’s infrastructure piece, or whatever else, but I just feel like somebody said this to me the other day, and I think it’s absolutely spot on, there’s so much inner kind of commoditized markets, where there are a lot of agencies with very little difference between them all struggling to compete at the point of demand, where the presumption is that the client knows exactly what they want. It’s so dysfunctional as a marketplace, and it only drives towards the bottom, which, you know, harms the clients agenda as much as it hides harms, the agencies as well. But I lost my train of thought, now, bugger. What was I gonna say.
Jonny Dunning: 1:17:05 Just come back to another point. You might well pick up on that in a second. But just to come back to something you were saying about the measurement of milestones and kind of protecting value on on both sides. It’s just better for everyone, because when you’re delivering a project is broken down into milestones, stuffs probably going to change along the way. And if it does change along the way, and that’s agreed, within that, within that process, you know, a change request a variation to the project, procurement can get on board with that the client, stakeholder gets on board with it, the supplier gets on board with it, and everybody moves on, because too often, people can just end up in the soup where a project’s gone awry. It’s not necessarily the suppliers fault. It might be that the client hasn’t hasn’t executed on something or hasn’t delivered, or they were late, or whatever it might be. But the it’s just a sensible way of doing business, I always think it’s kind of like the way people sometimes will engage builders on their own house, you know, sometimes you hear stories of people saying, Oh, it was just, yeah, they’re just gonna come along and take this much time, and it took longer and went on for six months, and they’re still here, they actually will keep my voice down, because they’re in the bathroom at the moment versus clear, we’re going to do this, and this will cost this much, actually, you just, you’re changing that moving the goalposts and you’ve asked me to do X and Y extra, so that’s gonna be this much extra. It’s just that clear accountability on both sides. By the way, if that hasn’t completely distracted you from the point that you were trying to remember, nothing will happen. You come back to you.
Robin Bonn: 1:18:30 No, we will, it will pop back into my head as soon as we hang up the call, actually, but as is often the way but you...
Jonny Dunning: 1:18:39 You were talking about this kind of just this tri party relationship, and about people having the kind of maturity and the confidence to come into that with the right approach. And I think you know, we’re in a, we’re in a time where conversations have opened up and clearly for you in the work that you do, you’re going to be talking to organizations about these sorts of problems and addressing these sort of problems in their strategy. And so I think it’s an exciting opportunity.
Robin Bonn: 1:19:10 Now I agree with you as is almost brings us back full circle, full service full service. God I’m so agency full circle. Back to the start. You know, you say that about always be closing. It’s a funny one because I don’t know if you’ve ever seen Glengarry Glen Ross is a day wherever you were aware of the scene, where you know that it’s a very pressurized sales meeting, where was the actor? He was in 30 rock series of brothers Baldwin, one of the Baldwin brothers forget which one it is Alec, isn’t it? He’s very aggressively telling this sort of team of very puts upon sales people that if they don’t sell stuff, they’re going to get fired. And that’s what that ABC scene is about. And when you’re in agency land, I always found this quite curious. Because the ABC reference for me was cemented in that first job where it’s like you that you sell, or you’re out on your ass. Okay, I get it. Whereas in agency land, selling is not a thing that we do. You know, we persuade we coax we’re compelling and all that stuff. And ABC is used as a sort of a kind of cheeky little pat on the back to people. Oh, ABC, nice work, see what you did there, you know, where you show a little bit of cheek or a little bit of, you know, you ask a direct question or something like that. And it sort of the sense of it gets completely lost. And for me, having sat both sides of that divide, you know, a sort of marketing organization versus a sort of hard no sales or sales organization. And it wasn’t like a worked in a boiler room, you know, what I mean? The it’s quite emblematic of the absence of a sales culture within most agency organizations. And I say most because some are explicitly very much sales organizations. And I think they are much more commercially aware because of it. But yeah, it’s an interesting little reminder, I suppose of the differences between a genuine sales culture, and one that just sort of imagines that it’s selling well, because that’s what agencies do, right? Not necessarily.
Jonny Dunning: 1:21:26 Yeah, it’s not like procurement aren’t used to be used to being sold to it’s not like they’re not expecting to be resolved soon. It’s not like they haven’t got all the kind of tactics and countermeasures to deal with that. But if it’s, you know, if there’s a genuine value gap, that can be filled by a credible solution, and then that’s what they want, really, and, but just just around things, it’s really, really interesting discussion. I really appreciate your time. And just in terms of what you’re looking at working on moving forward, what do you think are going to be the key areas and the type of organizations you’re going to be working with over the next 12 months?
Robin Bonn: 1:22:00 Yeah, it’s a good question. And I think this is it speaks to the changes we’ve described in the kind of the legacies of COVID, if you like, so when people ask about the ideal client fit for coda finery, they sort of say is it a certain kind of agency, a certain discipline a certain size, it’s really none of those things. So you know, kind of finery works with local network agencies, and startup agencies and everything in between. The thing that binds them together is, I suppose a willingness to be progressive. And I suppose to the, to the sort of plethora of points, overlapping points we’ve touched on today. And I think I mentioned this at the start, it’s the sort of latent value in the agency business model, it’s there, but it just needs to be recognized and connected. So understanding how a change over here in your agency business model can unlock value and revenue over there is where the work comes from. So the people that I will be working more with will be those that recognize that there is value locked up in the business, and are willing, and have the time to sort of look at the important in amongst the urgent, and to embrace the fact that, you know, if you look holistically at the agency, there’s a much better sense of differentiation that can be achieved. There’s a much healthier, you know, culture that can be achieved. And there’s greater profit that can be achieved. And none of those things are actually that difficult to do. If you’ve got the wherewithal to, we’re not even the wherewithal is just simply the willingness to look holistically at the business. And I think we’re gonna see more and more agencies, you know, wanting to have those kinds of conversations.
Jonny Dunning: 1:23:42 Like you said, it’s the strings holding everything together, kind of behind the scenes, isn’t it really going towards this overarching objective? Well, it’s been really interesting chat. Really appreciate your time. You know, it sounds fantastic, what you’re gonna be working on, and I wish you all the best with it. Hopefully, we can catch up again soon. For this conversation. Very, very insightful. It’s great to hear some of the anecdotes and you’re viewing it from an industry specific perspective. But yeah, really appreciate it. And yeah, thanks very much for your time, Robin.
Robin Bonn: 1:24:13 And Jonny, thank you. It’s been an absolute pleasure. Thank you for listening to me, prattle on and it’s been great to get an insight from your site as well. So thanks very much.
Jonny Dunning: 1:24:21 I’ve enjoyed it very much. Cheers, Robin.
Robin Bonn: 1:24:23 Cheers.