Article: Marketing Brew

Ad agencies have a lot to contend with these days: A pitching process that many describe as broken, concerns over how AI might change their jobs, and competition from in-house teams, just to name a few. That’s not to mention broader workforce trends that can affect things like recruitment and retention.

The Blueprint, an executive search firm specialising in agencies, recently asked several agency staffers how they’re thinking through some of these challenges and what sort of impact they’ve had on employees and company culture. It surveyed 1,349 “senior agency talent” across the UK and US in addition to conducting more than 25 interviews with leaders at Wongdoody, Ogilvy, BBDO, and more.

Among several findings, its research found that millennials often act as a “generational bridge” between Gen Z newcomers and Gen X leadership. Jules Brenton, director of growth and an associate partner at The Blueprint, said millennials might’ve not had much of a work-life balance until the pandemic, which “really put a spotlight on people wanting to separate work and life.”

On the other hand, work-life balance is “expected” from Gen Z, she said. “In the report, we say millennials are the bridge because I think they’re learning a lot from Gen Z and how they kind of put their foot down.”

These generational differences have had an impact on other aspects of work within agencies, according to the report. For example, as a result of the pandemic, Gen Z largely sees remote work as the norm. According to the report, 71% of those surveyed have “accepted that hybrid work is now non-negotiable.”

Pitch (not) perfect

Some workers have questioned more traditional agency practices, like pitching. Gen Z employees “don’t feel the same compulsion to be hands-on with pitching at all hours of the day,” and can see it as an obstacle to work-life balance “on top of their already full schedule of current client work,” the report said.

Brenton said pitching was once seen as “an opportunity to…really shine and maybe be seen by senior members of the agency. Whereas I’m not sure that Gen Z necessarily sees it in that way anymore. It all probably stems from the work-life balance thing.”

Some agencies have taken steps to address the change: Last year, Mother rolled out an initiative that encourages prospective clients to have “chemistry meetings” with the agency as opposed to conducting a formal pitch.

Another practice agencies may look to scrap or rethink? Charging clients by the hour instead of charging based on outcomes, the report said, noting that the practice has led to a “broken business model” that prioritizes the bottom line over the creative process.

“The business model is the biggest reason why our industry is falling down,” Gareth Moss, The Blueprint’s founder, told us. “The procurement-based model, it’s all about tightening margins, and that means agencies aren’t being paid reflective of the work that they are doing. Because of that, they can’t invest into different and fresh talents, they can’t invest in diversity…because they don’t have the money to be able to do it.”

Stand for something

As agencies find ways to court the next generation of talent, they are thinking about the role purpose plays in these efforts. According to the report, 93% of agency leaders surveyed said that social impact and status “drives talent and client attraction and retention.”

“Gen Z talent—and it surely isn’t alone—is looking for agencies to make a stand in a world that is increasingly divisive,” the report said. This can be seen in the emergence of groups like Clean Creatives, a group that seeks to cut ties between fossil-fuel companies and agencies.

When it comes to DE&I strategies, only 23% of respondents said that they are “really good” at “enabling and supporting a more diverse, equal, and inclusive working culture,” according to the report. The report pointed to several factors that could be inhibiting progress, including “a lack of senior role models and representation, risk-averse behavior, fear of getting it wrong (and the backlash that could bring), and over reliance on familiar recruitment models.”

Agencies should consider their approach to recruiting, Moss said.“I think sometimes agencies fall down because they always talk about wanting diverse people, but it’s not a one-way street. They have to adapt…It should be about shared values.”

While agencies rethink recruiting and other practices, it remains to be seen how broader developments, such as the explosion of AI, will affect talent cultivation. Nearly all leaders surveyed said they expect ChatGPT and similar tech to affect how they work in the future, though only 1% “expressed worry” about AI’s impact on the ad industry, the latter of which the report described as surprising.

“While we deliberate, the technology is coming at us faster than we can think,” the report said. “The consequences for the workforce and how it will change the skill sets agencies need—not to mention their search for talent—is a discussion that cannot wait.”