Agency Revitilization PlanMegan Blaich

Matthew FraherEdmée Jorge

Taylor Lockhart-LangSamuel Smith

Isabela Ver

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Table of Contents

State of the Advertising Industry........................... 3

State of Our Agency........................................................ 7

The Agency We Want to Be.................................... 10

Agency Revitalization Plan.................................... 14

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Declaring the absolute state of anything in the advertising business is almost an exercise in futility: not only is it relative, a bad year can seem good if it follows an even worse year, but it is temporal, and in flux, and any report on the subject should be prefaced with the following disclaimer: “This is the state of the advertising business on this date: December 5, 2012, and no warranty, either express or implied, is granted to guarantee the factual basis of this document on any date thereafter.”

State of the Advertising Industry

With that disclaimer, we feel confident in saying that the state of the advertising business is good, both globally and nationally. Spending has been increasing year-over-year, driven by increased spending in digital, which now accounts for roughly 30% of all agency billings. “Everything we do has a digital component to it,” says Omnicom President-CEO John Wren. As expected from this added component, traditional TV spends are dropping as advertising budgets shift to other platforms. There is also notable post-recession

growth as agencies bounce back, win new business, and once again expand their ranks. In short, the advertising industry is healthier than it has been in several years.

Astute observers will observe micro-trends in the industry as well. Smaller shops and digital agencies are quick to innovate, having less to lose, but bigger agencies have begun investing their capital in the tested and proven techniques that the smaller shops engineered, either buying out or simply emulating smaller ships. The existence of global holding companies makes buying out smaller shops easier and more profitable, as they have the ability to expand a small company’s reach worldwide, gain traction in foreign countries, and increase their ability to provide these services to the global

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market. The chance to work globally offers a nearly irresistible opportunity for a smaller agency who has worldwide ambitions.

Client trends in hiring have not changed much, and why should they? Big companies feel saf-er with big agencies, and small companies feel more competitive in their market when working with small agencies. This general rule has led to clients who tend to stick with agencies of a similar size when offering new business or bring-ing agencies under review. For instance, Burnett typically competes against the largest agencies in the world, including Deutsch, O&M, BBDO, Publicis, Y&R, DDB, TBWA, and Arnold.

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Key to Success Today

• Know the client’s needs. Marketers state that some of the biggest problems they face when working with advertising agencies are quantitative: measuring ROI and keeping costs down. This is likely a result of focusing on primarily qualitative assessments (i.e. quality of creative, experience, reputation, and performance) when bringing agencies under review.

• Clearly define agency’s role. Is the agency primarily a creative shop, a strategy shop, or are they innovators? Different brands need different agencies at different times.

• Showcase creative and strategic skills. It’s crucial that an agency can clearly demonstrate the result of their work, both strategically (in terms of ROI) and creatively (in terms of awards). An agency that does a great job of this is Arnold Worldwide.

• Stand for something. Alex Bogusky said, “If you design for everybody, you don’t stand for anything.” An agency should have a clear image of who they are and the type of client they like to work with so that they can better serve that type of client.

• Meet client objectives. Common client frustrations include a lack of understanding of the client’s business goals, slow turnaround times, and agencies that do not

welcome feedback. • Be consistent. An agency is a brand, and

consistency is one of the major promises of a brand: a Coke’s a Coke the world around.

Agency Positionings

As agencies help build brands, they also try to create brands for themselves.

Saatchi & Saatchi’s invention of the “Lovemark” was an attempt to clearly define the value that they provide to clients. According to Saatchi, lovemarks transcend brands, reaching the heart as well as the mind. Unfortunately for Saatchi, the Lovemarks concept never took off to the extent that they hoped. They envisioned Lovemarks as a concept to replace the idea of brands, and now its primary public-facing claim to fame is a Pinterest board.

Leo Burnett created their own Brand Belief System, thereby defining their own position: “the best in the world bar none at converting buyers into believers.”

Other agencies have well-known positions as well: Ogilvy as the research company. W+K as

Name Management Big Brands Creative Innovative Strong Culture

TBWA/Chiat Day

Yes Yes Yes

Ogilvy Yes Yes Yes

Goodby Yes Yes Yes Yes

Arnold Yes Yes Yes

Most Needed at Leo Burnett

What is Working Today?

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unconventional risk-takers who create great ideas. Arnold with “great work works, ” the idea that solid creative and strategy creates measurable ROI. Grey defines themselves as the company that created “famously effective solutions” and CP+B is the “creative factory.”

Who is untouchable? Generally, award-winning agencies that are independent from the top major holding companies can have stranglehold grasps on their primary clients and brands. Agencies that are part of smaller holding companies that could be deemed as independently-run agencies are often hard to wrest work from as well.

A few “untouchables” today include CP+B, W+K, Droga5, and Mother.

Who is vulnerable? Most agencies under holding companies that now have a homogenous identity.

Grey• Recently lost Aquafresh Global and DQ

accounts, but seems to be the most promising among the big agencies. There’s buzz with their Febreze smell test campaigns, and they recently won RadioShack.

• Has the biggest +% change in revenues from 2010-2011 among the big agencies.

BBDO• Their biggest account, Gillette, is up for

review.

Leo Burnett• Leo Burnett had several good wins in 2011

but lost traction in 2012, losing 7 pitches.• 2011 Chobani account win might be in

jeopardy. Chobani’s CMO, who also appointed Burnett as their AOR, stepped down from the position. While there is no announcement of agency review, there has been no formal renewal of AOR contract which ends Dec 2012.

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State of Our Agency

Product QualityLeo Burnett is much more famous for its past than its present. With a client list that includes Kelloggs, McDonalds, Hallmark and Walgreens, it is evident that Leo Burnett has garnered much success with their previous work, even considering themselves a household name, much like the brands they represent. Its iconic brands are what makes Leo Burnett the agency that it is today.

However, as previously mentioned, the successful brands Leo Burnett represents are not current or new business, but instead, Leo Burnett is simply coasting from the success of brands that take little or no effort to maintain a float.

It seems as if Leo Burnett is unwilling to risk their reputation of past success by bringing on new business that might potentially fail to create the lasting success its current brands have.

Examples:- Sprint “Sprints Girl”- Kelloggs “From great start comes great things”- McDonalds “Lucky Penny”- Secret “Mean Stinks”- Coca Cola “Arctic Home”- Allstate “Mayhem” and ”Dog Collar”- Hallmark “Tell me”- Norton “Stuff Theater”- Walgreens “Walk With Walgreens”

New Business VitalityIn order to stay relevant in today’s advertising industry, Leo Burnett needs to differentiate themselves from their competition by letting their clients and consumers know who they are and what they stand for.

To do this, the agency has launched an innovation center aimed at bringing new products to market, both for clients and on its own, making advertising a lot more enterprising

The new venture, dubbed Farmhouse, puts marketing acumen into the mix at the earliest stages of development. Working with existing clients, fostering startups and tapping its staff for product ideas, Leo Burnett hopes to build a farm system to add the next Frosted Flakes to its roster.

“Our charge is to create things that are worthy of the advertising Leo Burnett does so well later in the process,” said Paul Earle, an entrepreneurial veteran brought in as Farmhouse’s executive director.

The Chicago Tribune writes, “Taking its name from agency founder Leo Burnett’s Lake Zurich farmhouse, which served as a creative retreat for senior management through the 1960s, the initiative will tackle everything from mundane household items in need of an overhaul to lofty

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digital concepts staking out new intellectual property.”Unique to Leo Burnett is Marlboro, a client they have had for decades. As Marlboro fought with regulatory interests and was banned from advertising on television, Leo Burnett adapted, moving to more integrated campaigns, including digital campaigns, far before their peers.

Our Agency in the News

Nov. 28, 2012: “Leo Burnett Chicago took home the first-ever D&AD White Pencil for the “Recipeace” campaign. D&AD’s White Pencil is a new strategy designed to harness the power of creativity and to effect real and positive change in the world. “We – the creative community – have the tools and talent to create big, bold and scalable ideas that have the power to change the planet for the better,” said Mark Tutssel, Chief Creative Officer, Leo Burnett Worldwide. “I applaud D&AD for creating the White Pencil challenge and inspiring the global creative community to make a difference. I am incredibly honored that Leo Burnett Chicago’s campaign for Peace One Day ‘Recipeace’ earned the inaugural White Pencil.” -- D&AD

Nov. 2012: Feed Chicago- Leo Burnett developed a program with the Chicago Food Depository that makes it easy for you to help feed fellow Chicagoans during the holiday season by doing what you’re already doing - eating out.

Oct. 2012: Leo Burnett, Pushing Ideas and Inspiring Change at Chicago Ideas Week: “Chicago Ideas Week is back, October 8-14, packed full of exciting idea sessions led by some of the most talented and influential leaders both inside and outside the industry. Amongst them will be some of our very own from Leo Burnett hosting sessions throughout the week centered around creativity and our latest innovation engine, Farmhouse.” -- Leo BurnettAs evidenced by these clipping’s Leo Burnett’s presence in the news is centered around their

do-good work in the community rather

than major new business wins.

Staff Quality

There seems to be an attempt by Leo Burnett to put employees with tenure in the company in their top management. Richard Stoddart, current Leo Burnett President, and Renetta McCann, current Leo Burnett Chief Talent Officer, rejoined the company after working for the client side and other agencies both in and outside of the Publicis Groupe. Investing in manpower for the agency has been a priority for the company; as stated in the Stoddart’s e-mail to Leo Burnett employees, “In this business and in this building, talent is everything. We are only as good as our people, and superior, dedicated talent is what will make us the very best agency in the world, bar none.”

The company has been in Ad Age’s best places to work in 2011 and 2012. However, in 2012, Leo Burnett’s ranking in the list dropped from No. 14 to No. 33. In an effort to keep their employees abreast of industry trends and new ways of thinking, Leo Burnett tries to provide training on “strategic thinking and craftsmanship, training for new and senior managers... and a digital curriculum.” According to Stoddard, “We’re proving that people want every bit of training and development we can give.”

Staff Morale

Nov. 9, 2012 Eight Leo Burnett staffers with Kellogg’s experience left to start their own agency. In a court injunction filed against them by Burnett, the Chicago agency alleges the renegade group are in line for a multimillion-dollar Kellogg’s CRM project which they worked on at Burnett and its marketing services arm, Arc—and that’s not okay, since their departure would essentially force the client’s hand. (AdWeek)

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With the recent developments on the Kellogg’s controversy in Leo Burnett, it only proves that the company has opportunity areas for Leo Burnett to re-build it’s staff morale. Although employees are hired under a big agency with a historical name, the current staff lacks outstanding creative executions. Although mass amounts of money has been spent on “great” creatives over the years, only a few of those creatives are still at Burnett.

Leo Burnett once said that if they cannot do great work in Chicago, they cannot do great work anywhere else. This is an attitude Leo Burnett employees must live up to, and not be riveted by the thought that being in Chicago makes them more special or less competent.

Reputation in the Industry

Because of the image Leo Burnett built as one of the pillars of the advertising industry, there is no doubt that the company is still well-respected advertising agency.

Leo Burnett prides itself as a “classified unified brand within the advertising industry itself. Leo Burnett Group is one of the largest and best known group of creative advertising agencies in North America. Leo Burnett Group has offices in Chicago, New York, Detroit and San Francisco.” (Leo Burnett Website)

Leo Burnett Still Wins Ad Agency New Business 40 Years After His Death (Ad Age): Leo Burnett is one of the most enduring ad industry legends. He broke all the rules. Even after 40 years since his death he is still winning new business for his agency (Fuel Lines Article)

“The Burnett agency has accomplished something that has eluded so many other businesses: It has managed to keep the spirit and drive of its founder alive and well almost two decades after the founder himself passed on.“ Rita Koselka of Forbes.

Basically, they’re respected for what they’ve done, not what they are doing.

Financial Stability/Independence

As part of the Publicis Groupe, Leo Burnett seems to enjoy growth in revenues. Leo Burnett has had an arsenal of big-sized clients that have been with them for decades. Possessing strong relationships with multi-million dollar clients help keep the company stable and afloat (but not necessarily innovative). For instance, the company was able to bill Kellogg’s a big chunk of their $710 million total advertising spends. On top of that, working with some of the world’s biggest advertisers will somehow help ensure that there will be businesses for the Leo Burnett to work on. However, there have been talks of Kellogg’s putting the account and the agency in review. Should this happen, the impact will definitely felt not only in Leo Burnett, but in Publicis’ Groupe’s revenues as a whole.

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The Agency We Want to Be

At a speech Leo Burnett delivered to employees in 1967, republished in brief here, Leo said:

“Somewhere along the line, after I’m finally off the premises, you or your successors may want to take my name off the premises too...

But let me tell you when I might demand that you take my name off the door.

That will be the day when you spend more time trying to make money and less time making advertising - our kind of advertising.

When you forget that the sheer fun of ad-making and the lift you get out of it - the creative climate of the place - should be as important as money to the very special breed of writers and artists and business professionals who compose this company of ours...

When your main interest becomes a matter of size just to be big, rather than good, hard, wonderful work.

When you start giving lip service to this being a “creative agency” and stop really being one...

That, boys and girls, is when I shall insist you take my name off the door.”

In order to prove it’s not time to take his name off the door, we need to demonstrate that creativity and innovation are still at the core of everything we do.

Leo’s work from the creative revolution of the 1960’s may seem old fashioned now, but it was revolutionary then. This agency used to lead the industries by ideas from one of the most innovative and adaptive minds in advertising.

We promised Leo that we would always place innovation through inspiration at the core of everything we do. We firmly believe that the agency will only be revitalized by asking the following question of everything:

What Would Leo Do?

The agency will no longer be led by the ghost of Leo Burnett and his legacy, focused on what he did 50 years ago.

Instead, the agency will be lead by his spirit and ingenuity by asking ‘what would Leo do now, faced with a digitally altered landscape, where content is king and consumers choose what advertising they see or don’t see, we ask ourselves:

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What Would Leo Do? Core Agency Equity PositioningLeo said... “One thing this company has never been is stuffy, and this is a valuable thing not to have been.”

Creatively lead & innovation inspired, Leo Burnett is the first agency to be equally traditional and digital, inspired by a tradition of innovation.

The agency must always be connected to its heritage, but as we emphasize that heritage as being one of innovation, we realize that this means emphasizing the equal importance of both traditional strategy and innovative digital solutions.

Product QualityLeo said... “Make it simple. Make it memorable. Make it inviting to look at. Make it fun to read.”

Creativity will always be king at Leo Burnett, but digital innovation will be our rising star.

As media consumption evolves, so too must the creative ideas of our advertising. In keeping with our commitment to being both traditional and digital, campaigns will be planned and integrated with both old and new media in mind.

New Business VitalityLeo said... “We built our business not so much by getting accounts as building them.”

Like any world-class agency, we will want big business vitality, but it will be more important to showcase our skills with smaller, lesser known brands. Building a small brand up from nothing is a more impressive feat than maintaining the market share of a big piece of business.

In addition, smaller clients with less to lose are less likely to be conservative. This type of client will be open to risk-taking, and could lead to some very creative work.

WWLDWhat Would Leo Do?

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Our Agency in the NewsLeo said... “When you reach for the stars, you may not quite get one, but you won’t come up with a handful of mud either.” We want the agency to be recognized for its commitment to community, its superior creative work, and as being a great place to work.

Leo said nothing about winning awards.

A lot of agencies want to be in the news for an award they just won, but we don’t want to com-promise work to chase awards.

Leo said, “We want consumers to say, ‘That’s a hell of a product’ instead of ‘That’s a hell of an ad.’”

We are more interested in winning ‘Agency of the Year’ or being named ‘Best Place to Work.’ This type of recognition is more intrinsically connected to the agency rather than the clients whose ads win awards.

Staff QualityLeo said, “Curiosity about life in all of its as-pects, I think, is still the secret of great creative people.”

The current problem with hiring at Leo Burnett is that we don’t know what we’re looking for, because we don’t know who we are. The solution is to only hire people who are creative and inno-vative in keeping with the equity of the company. We don’t want to hire people who have the right answers, we want to hire people who have the right questions.

We want people who are:

CREATIVE: Creativity isn’t just for creatives. It’s a way of thinking. Prospective employees must demonstrate creativity in whatever capacity they work, whether it’s their ideas about which clients to pitch, who the target audience for a product is,

a media execution, etc.

INNOVATIVE: Prospective employees must demonstrate a grasp of not only the ‘now,’ but the ‘next.’ Leo said, “To swear off making mis-takes is easy. You just have to swear off having ideas.”

COMMITTED: We want groom our own people to be leaders in our agency.

HONEST: A willingness to make and admit mis-takes. Leo said, “Promises must be kept, dead-lines met, commitments honored; not just for the sake of old-fashioned morality, but because we become what we do (or fail to do).”

Staff MoraleBecause our hiring policies will change, our em-ployees will know that they were hired for their creative abilities, no matter what part of the agency they work in. This will give them freedom to think and create without fear of failure. They will never feel like there are 10 people lined up to take their job.

Ideas are the currency of our agency, not tenure.

Reputation in the IndustryLeo Burnett will be known for having the great-est link to the past with the boldest vision of the future.

Financial Stability/IndependenceLeo Burnett has several big clients, like Philip Morris and P&G, which will be important moving forward as we take on smaller, less conservative clients.

What will it be like to work at this agency?

COLLABORATIVE: Everyone wants to produce the best work. Accounts will often be up for grabs to whoever can come up with the best work, but anyone can contribute in a small way to any project.

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ACCOUNTABLE: If everybody’s got a shot at any client and you can contribute, even in a small way, to big projects if you choose, then there’s no excuse for not contributing to some of the most brilliant work to come out of the agency. Every-one’s accountable for their own contribution in the agency.

SET FOR LIFE: Once you’ve worked here, every-one will want you...but you won’t want to leave.

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The Agency Revitalization Plan

What Would Leo Do - A Link to the Past and a Vision for the Future

Global Hierarchal StructureLeo said, “In operating a business of our size, it is obvious that we have to be well departmentalized. This does not mean, however, that we have to be channelized.”

Leo Burnett is a global agency. In terms of its hierarchal structure, there needs to be a certain equality implemented between the different branches. Currently, the Chicago office holds the perception that they are the cream of the crop. In order to move forward, we must create equality among offices, as we want all employees to contribute in idea generation. At Leo Burnett, we want briefs to be shared between offices because we believe that a great idea should have a shot at big opportunities, no matter where it’s from. Headquarters Hierarchal StructureWhile we are adamant about a completely equal standing in terms of our offices and their importance, Chicago will remain the headquarters by virtue of the fact that it was the first ever Leo Burnett office. However, the office will function more as a “meeting place” that all other offices will gather in, rather than an actual Headquarters.

PeopleEvaluation

In terms of handling the business, Leo Burnett must function like the client side and have employees be more accountable. In terms of evaluation, the agency will use the traditional evaluating system, but employees will be rated based on the effort they put into their work—i.e., getting promoted based on the quality of their work. In addition, all team members/employees will be evaluated based on their contribution to the entirety of a project, not simply on their contribution based on the role they handle.

Hiring

In terms of hiring, Leo Burnett is looking for intrinsically creative, peripatetic minds from people with interesting and diverse backgrounds. We will want to hire fresh graduates which the company can trade training for a bit of the “soul” of the new employee, fostering a connection that keeps the employee with Leo Burnett throughout their career. However, when the need arises to hire seasoned and experienced advertising practitioners, we will aim to employ those who will not just share their expertise, but those who are also willing to “teach.” We want a “Come and work with Leo Burnett” attitude, rather than “Come and work at Leo Burnett.”

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Training & Future Evaluation/Goal Setting

In terms of training at Leo Burnett, we want to implement a structure like Digitas. This will consist of one-day/half-day workshops, cross-ability training, and different workshops, which will be offered once a month on Friday afternoon. In addition, we would like to implement an annual evaluation for the purpose of giving employees enough time to learn and apply feedback to their work. Feedback would include supervisor to employee feedback as well as cross-department feedback.

Product

OPPORTUNITIES: At Leo Burnett there is an op-portunity to work with smaller clients, which will allow us to produce more innovative work. Sim-ilarly, dealing with smaller budgets might help the agency push more creative ideas.

MAINTENANCE: The work produced by Leo Burnett North America is not based on durable branded ideas. Future work should be designed as integrated campaigns that have legs to make it worth maintaining.

ELIMINATION: Our agency will look to eliminate small-minded, low impact campaigns. This will include one-off award chasing work, which is not connected to a larger, integrated campaign.

RECOGNITION: The agency will designate a team of award chasers who will modify existing campaigns to award-worthy formats. The goal is to generate reasonable award wins without participating in traditionally “award-chasing” behavior, involving controversial creative that is only aired once at 2am in Montana.

EXPERTISE: We at Leo Burnett believe in the Brand Belief System. This system suggests “the brand belief pathway of us all that it will be our intuition, instinct, insatiable curiosity, creativity, ideas and innate understanding of everyday life,

which will be the assets we prize most in con-verting buyers into believers.” We are only inter-ested in clients that will go “all-in” with us.

PUBLIC RELATIONS: Our agency wants to be reviewed and featured in any agency news re-garding our work, our pitches, and improvements in our company. Client Relationships Evaluation

Currently, Leo Burnett believes that they should be changing human/consumer behavior. In real-ity, we should also be changing client behavior. We need to keep clients who we do the best work for and create the best work for our best clients. In addition, we must handpick brands and try to pitch for brands that are open to innovative and creative work Agency Growth

BUSINESS GROWTH: In order for us to grow our business, we must take risks. We must pitch for brands that have lost their relevance in the mar-ket, pitch for brands that have small brands to turn them around and go for clients that are big and small, so that we will have the opportunity to do risky things.

EXISTING CLIENT GROWTH: - In order to grow our existing clients, we must encourage these clients to do more advertising activities, which will ultimately enable bigger billings

NEW WINS: At Leo Burnett, we intend to pitch small business and win most of them. When pitching big business however, we expect to pitch a lot more than we actually win.

PROSPECTS: At this time, our priorities lie in Kellogg’s, McDonald’s, Coca Cola, Sprite, Sprint, Nintendo, Altria, GM, Samsung and P&G. In com-

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parison to Philip Morris and P&G, Walgreens is an example of a smaller, conservative client. We will eliminate clients like this going forward.

Financial Management

Our agency must take risks with smaller billing clients. Should such campaigns not work, los-ing a small client would not have a detrimental impact on our agency. On the other hand, suc-cessful campaigns for small clients would serve to help Leo Burnett attract both new and big clients. Publicity Plan

In terms of publicity, we want to be “PR Heavy.” We want to be reviewed by any agency news re-garding our work, our pitches, and changes in the company. In terms of Leo Burnett’s image in the public eye, we will be the advertising agency that advertises ourselves. Launch (6 Month Plan)

Month 1-2- During our first two months, we will implement the WWLD internal event. ‘Leoisms’ will be integrated into copy, business cards, the start of meetings, etc.

Month 3-4- During the third and fourth months, the agency will produce a WWLD trade event for clients and prospective clients. This trade event will showcase Leo Burnet work and talent as well as share the new company culture.

Month 5-6- During months five and six, WWLD will be rolled out across the company. A reel will be produced showing the progression from the work produced in the 1960s to today, ie. story-board for a TV spot from the 1960s will morph into the storyboards for a viral video campaign the agency currently has running.