Suki Thompson: Murray, you must have seen lots and lots of client relationships over the years. What is a great client relationship? When you wake up and go “I really like working with at client. Our agency gets the most out of that relationship? What is that?”
Murray McLennan: They don’t have to be bosom buddies. Of course it’s nice if you like them as human beings. But do you know what? That is not essential. I think you have to have a bit of respect and trust but also if you’re doing great work. If you are doing great work and also clients who have the confidence to give you and the agency confidence rather than, there are clients who sometimes just like to keep you on your toes. I suppose that is the polite way of putting it. But what of feels like, is that they are always just needling you with a little bit of undermine, a little bit of uncertainty, and don’t give you that confidence. And agencies do their best work for clients when they are feeling confident, not threatened. So I think people can wake up and go “I feel confident in the relationship, I enjoyed working with them, and we’ve got a good chance of doing great work.” And I’m not just saying this for the clients and it works. I think you do great work and it sells, I think that is when it is most fun – when you’re being successful.
Suki Thompson: My observation is, for some reason, maybe a little bit like life, but client and agency business relationships have an ability to kind of press a red button of self combustion for some bizarre reason. Like weird things happen. Do you know why that happens?
Murray McLennan: You mean when things just go wrong?
Suki Thompson: When things just go wrong like, Pete was telling a story before about the client ended up writing the add themselves. No agency would in principle let that happen. No agency or client would say “it’s a good idea never do a status meeting or see the most senior person.” Do you think because effectively agencies or service providers, not partners, that that makes their behaviour be subservient?
Murray McLennan: To an extent, but I also think clients are under a lot of pressure and they panic sometimes. I think also agencies underestimate how nerve wracking it is for clients when they receive work. They’re sitting there and they are really nervous. I mean, I’m on edge sometimes when credit people show the work to me, let alone… my job isn’t usually riding on it – the client’s is. And so they are under a lot of pressure and it’s quite a nerve wracking whole series of events really. And that can end up with them going, especially because some of them, and often the more successful ones, like to be in control. I’ve had clients, I’ve had senior chief executives of companies sitting over my shoulder writing the ads. I mean, this happens sometimes. Sometimes it is a good bonding experience. I’ve been doing in-store window display ads with Chief Executive’s of companies at midnight in my office and, whilst I wouldn’t want to do it all the time, it is not necessarily a bad thing, as long as it doesn’t happen the whole time because eventually, they weren’t very good. Obviously. And you can’t be doing that the whole time. But I think agencies, I think if they are confident and they want it, and they are excited… Because the other thing that we all know, is seductive, is that you want to work with people you’re excited by your business and are excited with working with you and I think once a client feels that it’s just too much like work and they are going through the motions and there isn’t that excitement, that buzz that they really enjoy working with that client and find their business interesting, then you are going to lose the business at some point.
Suki Thompson: And how do you, running and agency, make existing clients as exciting as potentially what pitching does? Because, for years, pitching has been the kind of life blood of agencies and they get terribly excited about it.
Murray McLennan: Well you’ve got to be pitching; you’ve got to be growing. It’s like any client, if you are not winning any business you will go out of business eventually. So you’ve got to be getting new customers if you like. But I would say 90% of our time is on existing client business and, look, it’s bloody difficult to win clients. And it’s getting more difficult. I mean, you know this better than I, it seems like endless rounds of research and pitching and so on and so forth and meetings to win. It can take six months sometimes to land a client. So what you have got to ensure is that for all the people working on it are as excited, and of course they are to begin with an agency with the honeymoon period and all those other sorts of other clichés. But I think on an ongoing basis. If, as I said, if the client gives the agency the confidence and the opportunity to do good work. The people on it need to be motivated by the work, that is what keeps the agency going. Good business, good work and selling stuff. I think those three things can be exciting and you’ve got to make them exciting. Having said, what you also need the highs and the adrenaline rushes of pitches. Because it gives you momentum, it gives energy, it is massively energy sapping if you lose quite a few on the trot, as we all know. But when you win it is one of those great highs. But you can’t live at that level the whole time. You’ve got to get the excitements, and it is a good challenge, get the excitement into everyday work like an everyday relationship is impossible but you’ve got to get the excitement in at least once a week, once every couple of weeks. You may not have it every minute of every day – that sort of unrealistic, but you’ve got to get some of that in there.
Suki Thompson: And so do you mention the effectiveness of your ongoing relationships? What do you do to look internally and see that those relationships are working well?
Murray McLennan: Well, we have our own evaluation system. And we do that quite religiously with clients. Occasionally, we decide not to, rightly or not wrongly we say to this client “you know what? Just leave it.” We don’t want to just stir things up with this particular client. Most clients, though we do do that and it is a very useful thing to do to talk to clients, at least once a year. We find it difficult to do more than that, actually, but we do it once a year.
Suki Thompson: So does that mean we never lose any clients?
Murray McLennan: No, I think, do you know what, one does lose clients. I think next pride myself on having a lot of long-term client relationships in the agency. But what we try and do is, if you lose a major client and at some point we had a meteoric rise, when we started off the agency – win, win, win. We won a client every month for about the first two years, it was just fantastic. And you knew at some point you’re going to get kicked in the groin and kneed in the stomach and you were going to get hit hard and I always said to everyone “when we have our first major setback how we react will be the real test.”
Suki Thompson: Pete, you’ve now got our global role, you have a local role before. How different is it having a global role and running agency relationships? What do you need out of agencies now that you perhaps needed differently when you had a local role?
Pete Merkey: It’s certainly a very different when you’re working on a global level as opposed to a local and your demands from an agency network are quite different. Locally, it’s much more about the individual campaign, that individual element of performance that you’re driving. When you think globally, it is about the whole adding up to more than the individual parts. So, particularly in media, I’m looking for an agency that can make connections for me between different the activities and programmes that we do, look for new opportunities and test them globally, not just locally. And the same in the creative sphere, what are we working on that we could reapply and reuse in another format in another way? We are always looking for new ideas and agencies can help with that.
Suki Thompson: And then how do you evaluate the relationship? What you would do to make it work very well?
Pete Merkey: I think the great agency relationship is like any relationship, you both need to put something into it. So there is standard evaluation which I’ll do – be it surveys or forms. We’ve used Oystercatchers as well to do a post review, which is good. That always works for me. And Oystercatchers did a great job of evaluating our agency relationship. So I think it is good to have a third-party. But I think it’s also good to just talk regularly. So yes, you could do an appraisal but you can’t be having good on this conversation throughout the relationship. No one should reach a surprise moment when you go “you never told me that three or four months ago.” So for me the best trick is yes, evaluate but constantly keep talking to each other, keep sharing, keep challenging. That is what healthy relationships is all about.
Suki Thompson: And when it’s not really working, you’ve been a marketer for a long time; they must have been a time when they didn’t work? Why didn’t it work? What went wrong?
Pete Merkey: I can give my favourite example, and I’m a little bit ashamed of, but when I worked for a Telecoms company called Onetell, we worked with the EHS, who are a great agency. But the creative had gone off the boil and I got to a stage I was writing the press ads for my colleague and we were beating the control creative from the agency and loving it. And actually, every day, rewriting press ads and beating the agencies work because it wasn’t good enough. Perhaps fun at the time, but with hindsight not the greatest behaviour. We had more fundamental issue we needed to address and we should have gone in and been more demanding and more challenging in that moment, rather than trying to create and solve and turn it into a creative department on our own. So I think again you’ve got to have an open, honest conversation, absolute clarity and be clear what you expect. And when things go wrong deal with them quickly.
Suki Thompson: And so, in that instance, what did you do? Did you sort it out or did you pitch it?
Pete Merkey: Pitched in. Yeah, we moved it away, which I think is interesting because I think with hindsight now; we could have fixed some of that because it was a long standing relationship on a business that was growing and working but with a few accounting changes just went off the boil. And sadly, I think they let it happen and we let it happen, it was like a small, dying relationship. But actually, I think if we dealt with it in the right moment we could have saved it.
Suki Thompson: I think in the past there has been a lot of mortality around marketing directors to go into a new job and change agency. Do you think that’s still the case now? Not necessarily with you, you’ve actually had long-term relationships, but do you think that it’s still the case? And why do people do that?
Pete Merkey: It’s interesting isn’t it? I think with new marketing directors coming in because we all want to make our mark on the business, we all want to show that we can make that difference. But I don’t believe that the change in agency relationship is necessarily that answer. It might be one of the answers if it’s not working. There is always a danger when you come into a new team and run a new marketing function that you throw everything out that was there before. Well actually there is always going to be some great stuff in the team – be it people, be it assets, be it agencies, be it previous things that worked within the business. And the danger is you bring your toolkit from business X into that business and try and morph your new team into your old team and I’ve seen it happen quite dangerously. Throwing an agency out with the bathwater so to speak, is one of those things. You’ve got to be clear about what’s working and what is not. Fundamentally, is it fixable? If there are fundamental things, then yes, go and pitch. But I think the mature answer is to deliver the business results. If we need to do something different, what is that different thing? Is it a change of creative route? Or a change of personnel in the agency rather than a change of agency? It is always worth working at it and digging under the surface a bit more.
Suki Thompson: David, last year you ran a pitch with Tesco. Can you tell me why you ran the pitch, and what kind of criteria you used to sell it to the agency?
David Wood: I mean, there were business reasons and there are brand reasons as to why we ran a pitch. I mean, clearly they are inextricably linked. But the business had started to slow in terms of its growth, it wasn’t broken but the growth curve had started to slow. And the brand had started to become just a little less warm in the eyes of customers. So we were feeling more emotionally disconnected from our customers and customers felt that they were just having to use the Tesco brand rather than actively choosing to, rather than there was something more in it to have that relationship. And I think over time, being big has not been seen as being good and at its worst case I think sometimes people might have thought that we were a little bit dominant and a bit predatorily and a bit inward looking, not outward looking. And we recognise the need to re-engage with customers, to start to rebuild the brand’s reputation and to have a new conversation that was far more engaging and warm for our very large and loyal customer base.
Suki Thompson: So when you were choosing an agency, what were you looking for by choosing an agency? I know you chose widens, but what were you looking for?
David Wood: I think importantly within any relationship you have got to make sure that you like each other – do they like us and do we like them. But what has got to sit beyond that is the scale of the brand reappraisal that we are looking for, is this a team of people that, collectively, we think we can force the reappraisal we need for the brand? Is this a partner that understands the very broad range of offers that we have in our business? We are truly multichannel, multiformat business and international but increasingly we are growing beyond just a standard shop. So do they understand how we connect, how we provide a seamless brand experience across all channels? Have they done this type of stuff before? The quality of the people? It a lot of the usual stuff in there, but we were looking for the right people that were going to connect with us to create the brand reappraisal we wanted. I think widens had it, they had a great team throughout the pitch process. As you work with widens, there was just seamless interaction with those guys, everyone co-supporting with each other, they were real collective and a really energising team. They understood us, they really gripped the realities of our customer issues and our brand issues and showed us how they would approach fixing those. And I think importantly, they sort of like gave us a little bit of the North Star. We had a core purpose as a business, but they re-expressed it in a way that we could really, re-engage with as well. So we moved it to “we make what matters better together.” And in classic Tesco DNA insight into action but they landed in a really motivated and clear way that could cascade through all 320,000 employees that work in the UK.
Suki Thompson: And you got Phil Clark involved who is your CEO. Why did you do that?
David Wood: It’s unusual, granted. But I think, having our group CEO at the table was phenomenally powerful. It sends a very clear signal to the agency partners that the seriousness with which we are taking both this pitch and the brand reappraisal that we want. It is always good to engage the big guys up front because the decision-making process there is no backtracking thereafter. And truth be told, he is a man just full of passion and commitment for the business and he is 39 year veteran in the business and as far as I’m concerned there is no more energised and passionate about going through the change process. So it was great to have him at the table.
Suki Thompson: Because actually, you had Phil, who was the CEO. You had Benny Higgins, who was the CEO of the bank, you had Tim, who was the deputy CEO and you had Matt as well. What did those three in particular get out of the process? I mean, it’s quite a lot of their time that was involved. Why would they spend that time with an agency in this process?
David Wood: I think really putting the time in upfront gives them the confidence that we have got the right partner, so everything that then falls out there after they need to be less engaged with. No – maybe less engaged is not a fair reflection, but I will go back to it, actually. Having them there, signalled both for us and the agency partners the importance of what we wanted to do. And it was probably quite a new experience for a number of those guys. They are big characters in our business. So it is always best to get them aligned early and keep them tight I think.
Suki Thompson: And are they still involved now?
David Wood: Yes. I mean Philip is very much involved and we still have one to ones with the agency. He cares immensely about the work, cares immensely about the work. He texts me, phones me, we talk about work, the product, the creative product a lot. So he is very much on the pitch with us, which is phenomenally powerful. It’s only an accelerant and not a hindrance.
Suki Thompson: So you have had quite a lot of effort into getting widens and other agencies involved as well. How do you keep them? And actually, in the past you had an agency for a long time. But how do you make sure that you have a really good relationship that is enduring?
David Wood: Well, I’ll pick up on the enduring piece. Building and enduring supplier relationships is something that we have been doing as a business for over 90 years. You know, we are a retailer but a lot of our suppliers have been supplying us with 30, 40 and in some cases more than half a century. So it is in our DNA to work hard at building and enduring long-lasting relationships. And of course you need to be open and you need to be honest. You need a real clarity of purpose in terms of what you are trying to achieve. But we are big believers in increasing the scale of the relationship you have with your partners.
Suki Thompson: Tell me what did you learn from this evening? What insights did you get?
Hilary Cross: I learned a great deal, I think it was a very interesting discussion, but I think the key thing for me was that you need to take time, when you’re building an agency relationship you need to really ensure that you understand, they understand your business and they need to get to know your business right the way through. That is not just about your brand challenge or marketing challenge but your business challenge. And also you need to when I say take time, take time to respond to what they are doing so when they show you work don’t feel that you have to respond immediately. If you do want to go away and think about it overnight, and have conversations about it, take that bit of time because it could make a big difference on how you then get feedback and have a detailed and how helpful that feedback can be. Take time with the relationship and give it time to build those relationships really, really deeply.
Giles Pearman: What tonight showed me was actually there are a lot of commonalities between bigger businesses and small businesses in terms of the challenge they have. I think confidence and honesty are across all businesses. I think it doesn’t matter whether you are Tesco or whether you are a small start-up. The relationship that you have with your agency is exactly the same. You’ve got to have the guts and the courage to be confident with them when things are going right and when things aren’t going so right. The honesty is a huge part of that, not delaying the conversations that you need to have to be able to get the best creative work out of them. I also think as well what I kind of picked up tonight is the fact that getting, in fact, it was quite a comfort for me, is the fact that I thought maybe my business was a little bit more unique than it is about the business of getting CEO and buyer upfront. And I think that when you’re hearing huge blue-chip businesses talking about getting CEOs in pitch presentations and the value that comes out of that and to be honest with you. It is tricky and it is difficult for us because there are different agendas in terms of priorities. But there is a huge, huge value in getting and having them paying upfront if it is going to be paying, because once you go through that period, it means that the ride is so much smoother afterwards because you have that commonality of agreement and understanding and support. And that’s how our business works with global. We very much operate as an entrepreneurial start-up in that approach and we get senior buying very early on in the creative process and it is really interesting to see how that can also be true with the likes of Tesco.
Neil Christie: I think the thing that was really interesting for me was hearing the clients talking really honestly about their perspective on relationships and the things that make for a stronger, productive relationship and the importance. I think the two things that really interesting from the two sides of the table. The agency Murray saying and stressing the importance of thanking and supporting the agency and encouraging them, rather than breeding climate fear. And for the clients. What was really interesting was the importance for them of the agency really getting under the skin of their business and understanding all the aspects of their job of which advertising and communications may only be a very small part. And understanding what all those other external factors are that impact on what matters to their experiences.
Suki Thompson: And in one phrase how would you sum that up?
Neil Christie: The one phrase that summed it up, I think, for me, was “crap in, crap out.”