Saturday is the day for independent agencies at 17th Golden Drum. Since we last talked to them (at last year Golden Drum), they’ve been struggling with recession and hard competition in network agencies. If you are one of those who think about going independent, here are pros and cons from experts: Ami Hasan (hasan&partners, Finland), Vasily Lebedev (Red Keds, Russia), Eduard Böhler (Wien Nord, Austria), Marek Zoledziowski (Change Integrated, Poland), Simon Zoltan (Café Creative, Hungary) and Juraj Vaculik (Vaculik Advertising, Slovakia).
Böhler: YES! 1.) freedom, 2.) freedom, 3.) freedom, 4.) freedom, 5.) freedom.
Hasan: This is the time for independent agencies. They are more creative, have more entrepreneur spirit, attract better talent and have better tools in motivating that talent, have more financial flexibility than network agencies owned by huge faceless conglomerates in a faraway stock exchange. Go ahead, pick a network agency instead if you don’t care about quality of work, if you don’t want to know where the buck stops and be prepared for random decisions made someplace else.
Zoltan: YES: More flexible. More reliable. More responsible. More loyal. More suitable prices. NO: Less safe budgetary planning. Less regional coordination. Less professional support. Less fashionable for employees. Less open-minded.
Lebedev: Yes, because: from scratch; fast & mobile; culture relevance; quality, not quantity; a team of superstars. No, because: network agency has always a history & experience; unstable economy; network agency gives always better management; quantity, not quality; a well-organized team with subordination.
Zoledziowski: If the question is why open an independent agency and why not, than for me the answers are quite obvious. YES – because it will give you a sense of freedom and liberation that you haven’t experienced for a long time (or maybe even never before); YES – because you will start from scratch and be able to put the puzzles your way; YES – because now is the perfect time to do it. NO – If you dare it, there is no reason not to go independent.
Vaculik: YES: Clients will cooperate with you not because they have to, but because they want to! You can expand your business to other countries. Full liberty of decision-making. You are creating your own culture, your own environment. It is FUN. NO: No client, no business opportunity will be allocated to you automatically. All decisions, either those you’d rather not make at all, you have to make yourself. You cannot leave the agency over and try the another one – you can either sell it or knock it out.
Böhler: You can see it like that – if everything changes, it’s time for new and flexible units.
Hasan: Hasan & partners certainly is a reconstructed agency. We built a beautiful independent agency, sold it to Interpublic Group of Companies who managed to almost ruin it. We fought like hell for three years to gain back ownership and control and have now reconstructed it to be a beautiful independent agency again. Not a pretty journey, thank god we came out alive.
Zoltan: Not really. Independent agencies above a certain number of people do work in the same structure like network agencies. Under this amount of people they are rather hot shops.
Lebedev: I think that a network agency is a reconstructed independent agency :).
Zoledziowski: You could say that. When starting your own business you do everything to avoid mistakes and weaknesses of network agencies that you have experienced in the past. And if you are good at your work can easily travel beyond your local market. Today more and more independent companies work for global brands. They don’t need offices in 50 countries to be able do that.
Vaculik: I think, that both network and independent agencies will remain in existence side-by-side. Both models are being continuously re-constructed – it is an unceasing proces, caused by development of new technologies, media and customer behaviour.
Böhler: Network agencies, because worldwide clients reduced budgets stronger than locals.
Hasan: Recession was worse to networks. Their holding companies were already deep in debt and all they could do was order cost cuttings, cost cuttings and some more cost cuttings in their agencies – all to boost their stock price in short term. Independent agencies had their destiny is in their own hands, they could invest even in hard times and come out stronger from the recession. This is a business where strategic decisions should be made by ad people, not by bankers and bean counters.
Zoltan: In Hungary independent agencies got higher damage. Local clients got back their budget as well. Network independent agencies could be in serious trouble without the support. Many of them could not survive the crisis.
Lebedev: I believe that everyone suffered from the recession. But, of course, the independent suffered higher damaged, because most of them are not bound to contacts.
Zoledziowski: I think it is obvious that network agencies are going through very difficult times. If you look at the largest European market it will become clear that most new business pitches are won today by independent agencies. This wouldn’t be the case some years ago.
Vaculik: This is hard to say in general, because everything depends on region, dispositions and condition of each agency, no matter if network or independent one. However, there are certain changes in re-distribution of clients, competences and resources.
Böhler: You can make this part of the concept: better atmosphere to work and live.
Hasan: People and their talent is everything an agency has, no matter what the size of the agency. Good agencies practice product development by investing in the skills of their people, both in recruiting and in schooling. I don’t believe in an agency model that has one good team to win the awards and the rest are there just to make money. I believe in the quality of people, of all people.
Zoltan: In a smaller agency human resource management is not needed. It can be done by the management.
Lebedev: Of course, because the focus is set on quality and personality.
Zoledziowski: I think it should play an extremely important role in every company. I don’t think size makes a difference. I’ll give you an example. Zappos, the biggest shoe store on the web, that was sold to Amazon for over 1 billion dollars last year made it to the Fortune’s „best company to work for“ list every year for the last 5 years, regardless of their extremely dynamic growth. They knew that their culture was a key factor to their success and they were able to maintain it even when they became a large company.
Vaculik: This is a people business, so that we all are as good as good people we have. The difference is more likely in the motivation offered by job in network or independent agency and this is a sort of primary filter – what type of people prefers certain type of agency.
Böhler: I didn’t want to wait some years to make it in a network…
Hasan: I have tried both. I’m happier working in an independent agency, because I am an entrepreneur, because I believe I am more qualified to make strategic decision in my market than a bean counter sitting in New York and because I refuse to work with or for people who have no decency, no honesty, no respect for achievement, no loyalty and no shame. I want to work with people who I can trust and respect and who trust and respect me, not with liars, cheaters and crooks. As my late and great friend Jay Chiat once said: »I’d rather be a pirate than join the Navy.«
Zoltan: Today there is no more difference between independent and network agencies from a professional point of view. Why to get headquarters, directives and bosses above you? Why spend your time with reports? Why don’t you yourself go knocking on the client’s door?
Lebedev: Freedom. The main and only reason.
Zoledziowski: We believed in a dream. A dream of creating a new company that will raise the bar really high. We wanted a place where we would not be limited by corporate policies and where we could focus on producing great works and we would be having fun doing it. I think we couldn’t dream of a better start. Two and a half years from launch we expanded our business to another continent and have two Cannes Lions on our shelves. We had to work hard for that, but the most important thing is that we enjoyed it and are hungry for more.
Vaculik: Take a look at my 5 YES-answers in the first question.