A speech by Mercedes Erra, delivered during the event ? Le pouvoir des marques – The power of brands ?

I am worried about the future of our industry, and I will tell you why.

Nowadays, communication agencies, media agencies, digital agencies, PR agencies, all of the above are in bad shape. For years, the profitability of our companies has been steadily decreasing in France, dwindling from 8% in 2007 to 3% in 2015. By not fully recognizing the importance of our profession, we are killing it, because we are allowing aberrations to take place, each day more deleterious.

It has become normal for agencies to be asked to compete for a very big brand’s global campaign in two weeks, when it took more than six months for consultants to deliver a brand platform on Powerpoint.

It has become normal to take a strategy from an agency and give it as a brief to its competitors without even asking permission.

It has become normal to pitch agencies for nothing, because at the end of the competition there will be no winner, the competition will be declared null and void, and reissued the following month with other agencies on the run.

It has become normal for an advertiser to question ten years of fruitful collaboration with its agency just to see if by any chance a pitch would save a couple of points off the fee.

It has become normal to start competitions without following any of the rules, laid down by professional bodies and without compensating the participants.

It has become normal to assign global rights in perpetuity on all type of media, which is in no way legal, but still required by many advertisers and their purchasing departments.

As a matter of fact, everything has become normal.

We are used to say “Yes, we can”. But today I object. “No, we can not”. Not anymore.

We can no longer accept all the foregoing. We can no longer give away the search for ideas, the design of campaigns, their development. By doing so our profession will disappear.

And I bet, you, the advertisers, will miss us.

Soon creatives in three-piece suits will come to offer you, the advertisers, bad ideas billed at very expensive rates. You already know what these rates are.

We, the agencies, presented almost 30% fewer campaigns in Cannes this year.

You, the brands, have a lot to lose, because you owe a lot to those boys in shorts and flip-flops, to the insolent and rebellious girls who populate our agencies, who regularly spend days and nights on a script or a piece of design, and to those places known as advertising agencies, where freedom, and impertinence, still reign.

In our agencies there are two things that are truly irreplaceable:

1, The knowledge, firstly, of humanities and social sciences, the analysis and understanding of where people are going, the comprehension of what makes people’s hearts beat faster, of what makes the world move. Data is only exciting when analytic intelligence, and the force of human intuition make sense of them.

2, A rare ability to find meaning and ideas. This is where you need talent. And talent needs to be respected.

Today to resist ideas being crushed, agencies need respect and money.

Owners of brands, you need to respect this savoir-faire. And pay a fair price for it. France is very bad when it comes to agency compensation. Americans and English know the value of their agencies. How can the cost of a 6-month consultancy by an American agency for a global brand be worth 5 to 6 times what the French agency would charge for the same brand?

It is certainly not the skills of strategic planners that are in question, but the non-recognition of their talent.

The tangible difference between a bad ad and a good ad, you already know well what it is: good ads multiply results by 12.

This is called the power of ideas. So, it's worth paying a good agency, whose job is to make good advertising, the proper price.

Since 2007, as the workload has increased, our costs have risen more and compensation is declining, degrading the profitability of our profession.

So much so that today agencies are struggling to invest in talent and to recruit at necessary strategic and creative levels.

How to accept that a young graduate of a famous college will get paid much less when going into advertising than in a consulting firm? How can we continue to attract the best?

In the degradation of remuneration and quality’s game, you, the brands, will be worse off, and therefore, will have no interest in it.

We used to say, when I started in this business: “we have the agency we deserve”. This seems more and more true to me.

Your brands and our agencies need, I dare to say, for your own teams to be of a higher standard and therefore for our agencies not to be constantly challenged, and harassed, by marketers who have no experience or real knowledge of our business. Pressure and speed are hurting people both in our agencies and in your companies.

We need, together, to step back, to raise the level of professionalism, from the smallest to the largest agencies, so that our businesses earn a good living. It's vital on both sides, both agency and advertiser, to keep intelligent and talented staff in our business. It's vital for your brands because only strong, powerful, creative ideas can help them remain at the forefront in an increasingly complex world.