How Do Advertising Account Executives Build Long-term Relationships With Their Clients?

What is the first thing that comes to your mind when you think of “Marketing”? For me, the answer is advertising. While advertising has become a lot more targeted over the last couple of years, I certainly remember sitting in front of my TV, eagerly waiting for the program to continue and suddenly feeling the urge to buy a new toothpaste. I’ve always been fascinated by the way in which advertisers sell even the dullest of products, but until recently I hadn’t given much thought to the dynamics within an advertising agency itself.

One of my teachers at HEC Paris had previously emphasized the importance of building long-term relationships in B2B settings and reminded us that: “Organizations don’t make decisions, people do!” With these words in mind, I started wondering “How do advertising agencies create long-term relationships with their clients?”. 

Before finding an answer to my question, I reviewed existing literature to gain a deeper understanding of how advertising agencies operate. Belch and Belch (2001) define an advertising agency as “an outside firm that specializes in the creation, production and/or placement of the communication message and may provide other services to facilitate the marketing and promotions process” (p. 69). Aiming to satisfy the needs of their clients, who are normally firms trying to sell their products to their end consumers, advertising agencies serve as an example of B2B companies. In the advertising context, building long-term relationships with clients is especially important as the failure to do so not only leads to losing a certain business account, but also creates a ripple effect. While we’re all familiar with the saying “There is no such thing as bad publicity”, this does not hold true in the advertising context. Media is quick to pick up negative news, such as client-agency separations, circulating them rapidly among the remaining client. This might point some of the agency’s other clients to question the offering provided and consider searching for alternative agencies. As account executives are the clients’ main point of contact and therefore make or break the relationship, the question becomes: “How do advertising account Executives create long-term relationships with their clients?”.

One of my first sources of information was David Ogilvy’s (1963) Confessions of an Advertising Man. In this book, which some people refer to as “the bible of advertising”, David Ogilvy offers practical advice to current and future advertisers on how to get clients, keep clients and be a good client. Although his advice certainly makes a lot of sense, I couldn’t stop wondering how it contributes to building long-term client relationships. According to Theron, Terblanche and Boshoff (2013), long-term B2B marketing relationships are subject to four factors, namely positive disposition, relationship appeal, switching costs and reliance. Even though their study focused on financial services, I wondered whether the same concepts could be applied to the advertising agency context and decided to categorise David Ogilvy’s advice accordingly.

The first predictor of long-term B2B relationships, which encompasses trust, commitment and satisfaction, is positive dispositions. According to Moorman et al. (1993), trust refers to a client’s confidence in an exchange partner’s integrity”. In order to signal integrity, David Ogilvy suggests that account executives follow his lead and use their clients’ products. His rational is that account executives, and advertising agencies more generally speaking, should only advertise product that they love and consequently use. Furthermore, they should also own up to their mistakes as soon as they’ve realised their wrong-doing. In terms of showcasing commitment, which can be defined as “the desire to continuity manifested by the willingness to invest resources in a relationship” (Gounaris, 2005, p.127), Ogilvy offers three points of advice. For one, account executives should invest time into the relationship. By make sure that they are present when clients’ need them to be, account executives provide perhaps the most valuable of all resources to their clients, which demonstrates their commitment to the longevity of the relationship. The second resource, that they should invest is effort. David Ogilvy suggests that account executives do extensive research into the operations of their clients, so that they are as invested in the business as the employees themselves. If possible, they should even buy shares, as this will allow them to think of themselves as part of the company, making them more capable of giving sound advice. Lastly, Ogilvy recommends that account executives adopt what he refers to as the “ice-box policy”. He urges account executives to invest the required time and money into developing back-up campaigns, which enable the agency to bounce back quickly in case that the first campaign fails. This last point also ensures that clients are satisfied with the work that the advertising agency delivers.

The second predictor of long-term B2B relationships is the relationship appeal. Theron, Terblanche and Boshoff (2013) loosely define relationship appeals as clients’ desire to engage in relationships that appeal to them. Although not explicitly stated, Ogilvy suggests that account executives possess a high-level of emotional intelligence to pick up on their clients’ cues. Knowing what their clients need and catering to it, will allow account executives to be seen in a more positive light in the eyes of their clients. For example, account executives should be able to sense whether their clients want some honest feedback or whether this will back-fire on them. Another way to increase relationship appeal is to set up client meetings when things are good. If clients only meet the account executives in times of crises, they will quickly start to associate them with bad news. In David Ogilvy’s words “If you get into the habit of seeing clients when the weather is good, you will establish an easy relationship which may save your life when a storm blows up” (p.83).

Switching costs, which refers to “the sacrifices or penalties consumers feel they may incur in moving from one provider to the next” (Jones, Reynolds, Mothersbaugh & Beatty, 2007, p.337), is another component that contributes to the creation of long-term B2B relationships. As David Ogilvy points out: “The most dangerous thing that can happen to an agency is to depend on a single personal tie with a client company” (p.82). By making sure that account executives build ties with their clients at all levels, advertising agencies will ultimately increase clients’ switching costs, which makes it more difficult to abandon the relationship. Account executives’ ability to build-up knowledge about their clients’ business and provide relevant insights will also make clients think twice before switching the agency.

Lastly, B2B businesses, such as advertising agencies, should signal reliability. In addition to making time for their clients and adhering to deadlines, account executives can showcase their reliability by keeping clients separate. The decision to not disclosing any information about one client to another, serves as a signal that the account executive will be as discrete about the clients’ secrets as he is about those of his other clients. As David Ogilvy put it: “Once a client loses confidence in your discretion, you’ve had it!” (p.81)

While the current article focused on classifying some of the advice given by David Ogilvy according to Theron, Terblanche and Boshoff’s (2013) framework, it doesn’t provide a comprehensive list of how account executives build long-term relationships with their clients. As such, if you have any other pieces of advice from your own experience, I would love to hear them!

References

Belch, G.E. and Belch, M.A. (2001) “Advertising and Promotion: An Integrated Marketing Communications Perspective”, 5th ed., Irwin/McGraw-Hill, New York, NY.

David Ogilvy (1963) “Confessions of an Advertising Man”, Southbank Publishing, Harpenden, UK, 2013.

E. Theron, N.S. Terblanche and C. Boshoff. (2013) “Building long-term marketing relationships: New perspectives on B2B financial services”, South African Journal of Business Management, 44(4): 33-46.

Gounaris, S.P. (2005) “Trust and commitment influences on customer retention: insights from business-to-business services”, Journal of Business Research, 58(2): 126-140. 

Jones, M.A., Reynolds, K.E., Mothersbaugh, D.L. & Beatty, S.E. (2007) “The positive and negative effects of switching costs on relational outcomes”, Journal of Service Research, 9(4): 335-355. 

Moorman, C., Deshpandé, R. & Zaltman, G. (1993) “Factors affecting trust in market research relationships”, Journal of Marketing, 57(1): 81-101.