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marketing management consultants
Plan B:
Madison Avenue Makeover
Michael Farmer
TrinityP3 USA
December 4, 2017
© Copyright 2017
marketing management consultants
Plan B
What you do when
Plan A self-destructs
marketing management consultants
Time for Plan B
marketing management consultants
He’s Plan B?
Time for Plan C
marketing management consultants
Don needs Plan B
marketing management consultants
Plan B
Drowning in
deliverables
marketing management consultants
Plan B
The consultants are
coming
marketing management consultants
Plan B
Even for Holding
Companies
marketing management consultants
Sir Martin
Needs
Plan B
WPP Share Price 2017
marketing management consultants
Plan A has self-destructed
•  Money and growth … dried up
•  AOR relationships … disappeared
•  Respect for agencies … a thing of the past
•  Commodity pricing … worse every year
•  Reviews … at the drop of a hat
•  In-house agencies … a real threat
•  Depressed salaries … invisible bonuses
•  Client cutbacks … less faith in marketing
marketing management consultants
What is Plan B?
Before you decide,
… know what Plan A problems
need to be solved
marketing management consultants
PRICE,
PRODUCTIVITY AND
PROFITABILITY
marketing management consultants
Icarus Agency Office with 10 Clients
Client	Name Fees FTEs Hours Fees	per	Hour
Alpha $1,423,811 7.2 12,679							 112.30$									
Bravo $1,640,593 17.1 30,070							 54.56$											
Charlie $842,052 5.3 9,402									 89.56$											
Delta $500,204 2.0 3,584									 139.56$									
Echo $3,737,841 13.9 24,455							 152.85$									
Foxtrot $67,345 0.3 544												 123.88$									
Golf $1,988,342 11.2 19,795							 100.45$									
Hotel $7,464,519 21.3 37,456							 199.29$									
India $1,780,009 6.2 10,960							 162.41$									
Juliet $3,558,578 9.4 16,572							 214.74$									
Total $23,003,295 94.0 165,515					 138.98$									 **
** Supports $104,000 – $110,000 in average salary per FTE
marketing management consultants
“Workload?”
“Income”
“Resources
& Costs”
marketing management consultants
“Income”
“Resources
& Costs”
PriceProductivity
Profitability
“Workload?”
DECLINING
PRICE FOR
AGENCY
WORKLOADS
-62.5% from ’92
INCREASED
OUTPUT PER
CREATIVE
+128% from ‘92
OUTPUT PER HEAD:
(SMUs PER CREATIVE PER YEAR)
Ideal level = 4.1
marketing management consultants
Office diagnosis – with workloads
Client	Name
Fees Deliverables SMUs
Price	(Fee	per	
SMU)
Creative	
FTEs
SMUs	per	
Creative
Alpha $1,423,811 444 40.9 $34,837 2.3 17.8
Bravo $1,640,593 425 38.0 $43,219 7.2 5.3
Charlie $842,052 61 12.5 $67,611 2.0 6.4
Delta $500,204 73 4.0 $124,160 0.7 5.5
Echo $3,737,841 33 20.2 $185,459 4.7 4.3
Foxtrot $67,345 4 0.3 $194,966 0.0 8.2
Golf $1,988,342 26 7.4 $269,574 2.4 3.1
Hotel $7,464,519 158 26.8 $278,808 8.2 3.3
India $1,780,009 17 6.0 $297,627 1.8 3.4
Juliet $3,558,578 15 8.7 $407,764 4.2 2.1
Total $23,003,295 1,256 164.7 $139,693 33.4 4.9
Icarus	ScopeMetrics®	for	Top	Ten	Clients	--	2015		SOWs
SMU’s = ScopeMetric® Units
marketing management consultants
Resource Allocation
FTEs per
SMU
Price per SMU (by client)
Office or industry average,
Resource & Price
High Price,
High Resource
Clients
(Overperformers)
Low High
High
Low Price,
Low Resource
Clients
(Underperformers)
marketing management consultants
Creative Productivity
SMUs per
Creative
Per year
Price per SMU (by client)
Office or industry
average, Creative
Productivity & Price
Low High
High
High Price,
Low
Productivity
Clients
Low Price,
Stretched
Productivity
Clients
marketing management consultants
PROFITABILITY
marketing management consultants
AGENCY RESOURCES – to maintain profit levels
COMMISSION ERA CURRENT ERA
marketing management consultants
Similar Competitors but different performance
The typical Saatchi & Saatchi
Account Executive salary is $52,943.
The typical Bain & Company
Associate Consultant salary is $77,172
Data source: Glassdoor.com 1/2017
marketing management consultants
Billing multiples
2.3x salaries 5.0x salaries
marketing management consultants
Hourly billing rates
The typical Saatchi & Saatchi NY
Account Executive: $66/hour
The typical Bain & Company NY
Associate Consultant: $214/hour
marketing management consultants
Bain & company
marketing management consultants
Saatchi &
Saatchi
Our Purpose
Who we are
and what we
stand for
? ?
marketing management consultants
Leadership
Al Ross, The New Yorker, The Cartoon Bank. With permission
marketing management consultants
Decide: What’s wrong with Plan A
•  Agencies have not exercised control over pricing
•  Pricing is in decline because workloads have been ignored
•  With declining prices, agencies have downsized
•  With downsizing, agencies have eroded their capabilities
•  With eroded capabilities, agencies have failed to solve
complex client brand problems
The fundamental problem to be solved is the
pricing problem
marketing management consultants
MISSION
marketing management consultants
Strategic mission (Agencies on behalf of clients)
1.  Mission. Identify, quantify and realize brands’ full
performance potential
2.  Relationship Requirement. Negotiate a Top level
Strategic Partnership -- an agreed LT program to
achieve brands’ full potential
3.  Skills Requirement. Consulting-like business analytical
skills, leading to new brand strategies. Then….Scope of
Work development to achieve the strategies
marketing management consultants
Scope of Work management
marketing management consultants
SOW challenge
1.  Required Role. The Agency must design and negotiate
recommended SOWs
2.  Remuneration. Agencies must negotiate fees based on SOW
workloads
3.  Agency Policy. “Every client in every agency office must have its
SOWs documented and measured in a uniform agency way.”
4.  ScopeMetrics®. Use our SOW measurement system – the only one
in the industry to quantify SOW workloads for fee-setting purposes
(Google “ScopeMetrics®”)
marketing management consultants
Accountability
marketing management consultants
Accountability challenge
1.  Requirement. Account Heads must be held accountable for results
-- for fees, workloads, resources
2.  Overview. Agency top management must measure, review and
manage Account Head performance.
3.  Requirements. Use ScopeMetrics®, and the use of ScopeMetric®
Units (SMUs) to measure workloads
4.  Action Plans. Account Heads must develop “corrective action plans”
for clients who underpay relative to SOW workloads
marketing management consultants
In Summary
1.  Reposition the agency to analyze and fix client brand problems
2.  Create a culture of measurement and accountability
3.  Implement ScopeMetrics® to measure workloads and performance
4.  Track, measure and negotiate remuneration based on SOWs
5.  Hold Account Heads accountable for fees, workloads and
resources
6.  Review and measure Account Head performance
7.  Fix underperforming clients
8.  Achieve premium pricing (Price per SMU) based on
positive results
marketing management consultants
Plan B
marketing management consultants
For more information on Plan B contact
TrinityP3
New York
+ 1 (646) 666-7142
Sydney
+61 (2) 9964 9900
Singapore
+65 6631 2861
London
+44 (203) 790 9229
people@trinityp3.com
www.trinityp3.com
TrinityP3.com/blog/
@TrinityP3
TrinityP3
TrinityP3.StrategicMarketingConsultants

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