Friday, February 25, 2011

The economics of scam

Ok, this is my one and only rant on scam.
If Steven Levitt, of Freakonomics fame, spent a couple of days looking at the economics of scam, what would he say? I'm not Steven Levitt, but here's my guess.
Scam takes 3 points off of an agency's margin every year - yeah, I said it!
Why? 
Money: A huge additional draw on already scarce resources. Simply put, chasing awards with scam (as against real work paid for by clients) costs an awful lot of incremental time and money - money that I believe could be put to better use. 
Morale: When I started in the industry, awards were a movement for motivation; increasingly they have become a rite of passage...without them you don't get to progress. It’s also a morale downer for the rest of the agency who don’t get to play at the awards game - a fact that can eroding trust and respect within the other departments who see scam put above real work in the creative pecking order.
Clients: Every hour spent on scam is an hour less spent working on actual client  business. Today, with clients more demanding than ever and competitors more ferocious than ever, this is suicide. Ask yourself; are you better off winning an award for something that doesn't really exist that no-one will ever see, or trying to do better work on real client business?
Inflation: Win more awards, get better jobs, get paid more, win more awards, get better jobs, get paid more...and round it goes. Agencies are creating creative salary inflation and using the company’s money to do so. I say pay great creatives great salaries for real, not made up, work. Creatives remain the engines of our industry and they should be paid as such.
The Emperor’s Clothes: Scam work is a scam in and of itself. No-one believes it’s real and everyone sees it coming a mile off - clients, colleagues, other creatives, journalists, everyone. A very well known industry expert shared some data with my former agency last year which said that, in his 2010 survey, the most important thing clients looked for from agencies was “creativity” and the least important thing they looked for was “awards”. Some of my creatives colleagues (you know who you are) couldn’t understand the incredibly obvious distinction - a distinction that clients clearly got!
I'm not a creative hater, not by a long shot. But I am a selective award hater - at least when it comes to awards given to scam work. 
The over emphasis on awards creates and the proliferation of scam in those awards shows creates a false economy in our industry. Furthermore, it wastes money, time and energy that should be put to better use - hence my 3 points of the margin lost guesstimate. Too often it doesn't reward real effort on real business - which is so much harder than cranking out a scam ad for some local museum - and it can create a false sense of achievement and standing.
The problem is that we've convinced ourselves that we need awards - the amount of times I've heard "if we don't play the awards game, we won't get the best creatives". I think that may have been true in the past, but today's best agencies increasingly look for real work on real clients - maybe they always did. You show up at BBH or Weiden with a bag full of scam metal and you won't be taken seriously.
Young creatives, don't take a puff of that award joint. Do great work on whatever clients you get the chance to work on, be proud of pushing work from crap to acceptable, and from acceptable to great.  Jump on real opportunities to surprise the world with your creativity and by all means enter your best work into the best awards. But don't fall into the trap of thinking that's all that matters, because if you do, it’s a hard one to get out of and once you have that reputation, you have it for life.
The consistent push back I get on this subject is that clients in the region rarely give agencies the opportunity to do "good work". I'm sorry, I think that simply shows a cock eyed understanding the business we are in and a distorted view of what constitutes "good work". But that's for another time.
Stepping quietly down from my soapbox....
Now, bring on the firestorm of indignation....

1 comment:

sophia said...

I think this theory of Neil's has hit the nail on the head. Well done!