More and more people are being drawn to the idea of starting their own agency. Why? And unless these new agencies bring something new to the table, are they doomed to fail?
Independent agencies have a set of key words they like to roll out when questioned about their worth. They are ‘nimble’, ‘agile’, ‘faster’ and ‘smarter’ they say.
The argument is that the established networks are dead in the water. That the old operators are slow to make decisions and even slower to react. That they are intrinsically incapable of change due to the very nature of their genetic make-up. Independents, in contrast, are free of the bureaucracy and politics that weigh their network rivals down.
“Creativity naturally rhymes with independence. It cannot be imprisoned,” asserts Ghada Chehaibar, managing and creative director at Purple Advertising in Beirut. “If it abides by too many limits, it becomes a factory of automatic production.”
Earlier this year Moray MacLennan, the worldwide chief executive of M&C Saatchi, stated that large agency networks were under greater pressure than ever from clients and independents as advertising becomes more on-demand and personal. “Clients want speed and flexibility,” he said. “They like the entrepreneurial spirit and new solutions, not ones caught up in big network processes and systems. Clients are people too, and people here and elsewhere want greater individuality and individualism. It is the age of the entrepreneur.”
Yet questions surrounding the region’s independents are numerous. Are they sustainable? Do they pose a significant threat to the big networks? Do they offer anything unique? Are they digitally and technologically advanced? Are they even any good?
What’s more, their numbers appear to be increasing. The established names such as Face to Face, Hug Digital, Tonic, Livingroom, Phenomena, République, Interesting Times, King Tut’s Playground and Kairo to name a few are being joined by a cavalcade of unknowns.
“Currently the market situation seems to favour independent agencies,” believes Maya Saab, managing and creative director of Beirut-based Spirit. “There are numerous regional indicators that would support this argument. In recent years there has been a shift from global agencies to local agencies as they provide know-how and skills specific to the region, which international agencies seem to still be adjusting to.”
Yet, admits Claude Checrallah, general manager at Lorem Ipsum in Beirut, “we are all very vulnerable”. “Yes the model is sustainable and viable, but any business mind will tell you that a lot will fall and few will thrive,” he says. “It is harder and more stressful to be a free bird, and it needs much more attention and immediate tactical flexibility. But the key word is free.”
“There is no doubt that the industry as a whole is facing rocky times,” adds Fadi Mroue, the founder and managing director of République, a former Dubai Lynx independent agency of the year. “In the short term this could be an advantage for independent agencies, as clients seem to be embracing the idea of smaller shops that provide good work at competitive rates. But this is short term; independents need to take advantage of this situation to prove that working with specialised shops means better work, more know-how and a younger team.”
Launching an independent agency, however, has always been a gamble. Regional uncertainty, war, the low cost of oil, economic turmoil and the changing face of advertising, technology and media have only made it more difficult.
“It is extremely hard to start an independent agency,” admits Ramzi Barakat, the founder and chief creative officer of B, the creative boutique. “It is not for the fainthearted. It is hard because you come with a new point of view, you start off with no proven record, and with a new business model and set of beliefs; something quite intangible that hasn’t been tried before. It is also hard because clients and brands, at least in the Middle East, do not believe in nor require new ideas. They do creative pitches and never use the creative. So it is less likely for you to get assignments where people are looking to try something new.”
Further complicating matters are questions of whether independents can thrive in the merger and acquisitions era. Are they at greater risk from shifts in political, economic and social turmoil? And is the winning of integrated briefs by the big holding groups across their advertising, media, PR, and digital agency brands consolidating the big five’s hold on power rather than diminishing it?
“That’s not the future. That’s the past,” replies the Dubai-based agency Livingroom, which insists on being recognised as a single entity rather than a group of individuals. “Good independent agencies have always been integrated, adaptable, agile and flexible. Great insights and ideas by their very definition work across media. That’s where the real value to clients lie. Production and the ability to execute across media is a different discipline. Most of the time you would want to work with the best in class and whether it’s stand designers or app and games developers, the best generally don’t work for network agencies.
“Dinosaur agencies becoming bigger dinosaurs are not a threat. Most clients do not want to be a smaller and smaller fish in a bigger pond. The merger era highlights how finance has over-taken creative business solutions as the primary reason to be for most agencies.”
Fady Karim, chief executive of theAdkitchen, agrees. “Integration can happen without giving holding groups full briefs. This is an old school of thought as nowadays for medium and large clients the integration is happening between specialised independent agencies and not agencies within one holding group.”
“Imagine how poor the business would be if there was only one type of agency on offer,” adds Alain Shoucair, the former regional executive creative director of Drive Dentsu and now the founder and chief executive of Beirut-based Bluetrain, which opened its doors in January. “Clients aren’t all the same. They have different needs and problems. They need different solutions. Ask yourself why the output seems samey these days. It’s because we have too many identical agencies.
“The future is about being faster and smarter. Lines of communication have to be shorter. If that piles pressure on the bigger networks, then it’s all for the better.”
Is a new breed of talent being drawn to the idea of creative independence?
“Yes,” replies Livingroom. “Globally, the creative independents have always been the agencies people want to work for. Just think Wieden+Kennedy, Mother, Droga5 and BBH. Far less people wanted to work for the big agencies of the marcom holding companies. Globally the reason has always been the same – independence, freedom and responsibility. Plus, most importantly, they just did the best work.
“In this market it feels like more people are being drawn to creative independents because they’ve just had enough of the culture of network agencies. The politics and the lack of direction. The relentless push for bogus awards turning your one job into two. Bad management that manages to be both lazy and greedy, thus failing to motivate and reward their staff.”
There are issues, though, that need to be addressed. Independent agencies that thrive in other parts of the world tend to be those bringing something new to the table. They are innovators, adapting to an increasingly digital marketplace and often changing how we view advertising. This is not the case in the Middle East. Here they are more often than not simply smaller versions of bigger agencies offering much the same product, but at a reduced cost.
“The advertising industry in the MENA region is disconnected from the tech industry,” says Mroue. “You have ‘web’ companies and ad agencies. We still haven’t realised the importance of putting these two together. New agencies opening up or about to open whose offering is the same as established agencies ‘but better’ will quickly learn that the market is not big enough for them.
“An independent agency should function like a tech start-up, bringing talented people together in a laid-back environment to make great things happen. Our clients are our priority, but that doesn’t mean we can’t dedicate time every day to work on products, ideas and initiatives that can improve lives around the world. If an agency can find this balance, this motivates the team and makes them feel part of something great.”
Shoucair adds: “To some extent we’re still playing catch up in the MENA region. Other parts of the world were quicker to embrace the digital evolution and are ahead of us in adapting and exporting new technologies. If there’s a failing in some of the new agencies in other parts of the world, it is the fact that they consider themselves to be a post-advertising niche. They often neglect the big picture. This leads to short-term thinking.”
In an era of entrepreneurship and disenchantment with the established order it is likely that more and more independents will spring up across the region during the next two years. Most will be of dubious quality, especially if they are started by account handlers with access to clients who just want to make money.
What’s more, the challenges are many, not least adding innovation as part of strategic solutions to business challenges, says Karim. Then there’s finding clients that share the same passion and belief in the power of creativity, hiring the right people, and weathering economic and political storms.
“We are in the middle of a revolution and this may never settle,” says Barakat. “Agencies are calling themselves digital by just posting on social media. Others are positioning their companies as branding agencies by designing logos. Some are pitching clients with Facebook data and Google ads. It is an interesting era because we are all learning and at the same time defining the future of advertising.
“We are waiting for this spark of genius that could bring the power of data to its knees. It is not definable now with data intelligence and machine language and algorithms ruling our world. There is no clear, cool idea anymore. But if there will soon be a new defining idea for the new business of advertising, it is most likely going to come from an independent agency.”
