Ever since he was appointed to the global marketing job at Unilever a couple of years ago Keith Weed has been trying to bring a degree of rationality to his ad agencies and all the multifarious activites and companies that accompany them.
He’s left his ad agency line-up more or less as was (most notably by supporting Lowe & Partners by insisting it brings in the talent he wants where necessary) and now he’s turning the focus on digital agencies (which he wants to partner with trad agencies) and TV production companies.
This can be a right old can of worms although both Procter & Gamble and Reckitt Benckiser have already instituted their own versions of TV production rationalisation.
The reason it’s tricky is that agencies have their favourites, and not always because they’re the best at the job or the cheapest.
Marking up production company output has always been a big part of agency income, once formalised in the UK at 17.65 per cent via a complicated formula, essentially 15 per cent plus 15 per cent of that figure on top (don’t ask). In practice the mark-ups have often been far more, often around 30 per cent.
Agencies would say (privately) this was because the business of producing good TV campaigns was fiendishly difficult, not least because the client was always trying to muck things up, often by appearing on set.
Production companies, on the other hand, would claim that they were encouraged to spend ludicrous sums on crewing etc just so the mark-up was bigger. They then earned a reputation for being ludicrously expensive even though they didn’t receive all (or in some case most of) the money.
Some would also say they did much of the agency’s work. The famous commercials and (underrated) film director Paul Weiland once told me that he spent much of his time re-writing the agency’s script. Weiland, who directed the famous Guardian ‘points of view’ ad and many of the Walker’s Crisps series, started life as a brilliant young copywriter at Collett Dickenson Pearce when one Charles Saatchi was the star of the creative department.
Unilever’s Weed, who’s been around the block a few times, knows full well how tortuous this issue can be and, in his usual collaborative way, has consulted the agencies throughout this process.
When Unilever’s production roster is in place agencies will have to include two quotes from companies on it although they’ll be allowed to propose others.
This is necessary because (apart from freshening things up) production companies are about directors and directors come and go. Often they’re freelance (film director Mike Leigh makes commercials from time to time) and good house directors usually go and start their own ‘company’ (themselves, a producer and a PA) as soon as they hit the big time.
So creating a list of the best is rather like herding cats.
There’s also the factor that animation is playing a huge role in commercial production these days (imitating the likes of Toy Story in Hollywood).
And if you employ the likes of animation and effects studio Psyop (recently performing for Citroen and Fanta among others) they are the production company. But how do you keep tabs on up and coming animation studios? They spring up overnight.
Unilever spends $6bn plus advertising its wares around the world so it will get some of what it wants. But it might prove to be a tidying-up exercise more than anything else.