Industry Focus: Marketing

Marketing agencies in the Silver State are adapting to rapid changes within their industry to meet client expectations. Recently, Nevada leaders in advertising and public relations met at the Las Vegas offices of City National Bank to share new and changing trends and how they affect the industry.

Connie Brennan, publisher and CEO of Nevada Business Magazine, served as moderator for this event. These monthly roundtables are designed to bring together leaders to discuss issues relevant to their industries. Following is a condensed version of the roundtable discussion.

What is a common client misconception regarding marketing?

MELISSA WARREN: A challenge that we all face is budgets that don’t support the time and labor-intensive nature of what we do. Clients don’t understand what it takes to accomplish goals and objectives, in particular, how it relates to social media. Social media is often seen as, “well, you can just add that on for an extra $500.” We all know, the time it takes to do a good job with social media, in gathering organic content and making it relevant, is much greater than that.

TIM QUILLIN: The time, the hours, that go into social media and digital is huge. Now everybody’s got a nephew or a friend who does social media or builds websites so they bring these services in-house or are not willing to allocate enough money for us to really do it right and to develop strategies and to follow them through. It takes time and time is money.

BRIAN ROUFF: There’s another issue. Most clients are not discerning. Most clients can’t tell the difference between okay work, good work and excellent work. There’s a huge educational process that goes into explaining why what we do, let’s say in terms of content creation, is superior to something that their nephew could do.

KURT OUCHIDA: The task before us is, somebody can easily google “best practices” [in our industry]. [For us,] it’s besting best practices and staying ahead of the commoditization of what we all do. When you can get data that’s going to quantify a level of impression to engagement to conversion, we have to outpace that. Change is a constant and besting best practices as they apply to the segmentation of a particular target audience will forever be a challenge.

How do agencies determine pricing?

ELIZABETH TROSPER: Our industry has always been very hard to quantify to people outside of it. We know how hard we work. We know that we’re 24/7. We know all the hours that go into social media, but trying to tell somebody about that is always difficult. I think there will always be hourly and retainer clients. We’re half and half. Half like to be hourly and half are retainer. We try, for budgeting purposes, to focus on retainer clients, but that’s not always the case.

WARREN: Because we provide more services and products than we used to, there is more pressure on the budget because, again, they’ll say, “Can you just throw in a video or can you throw in social media?” Ten years ago, social media wasn’t really a thing for our clients so there wasn’t an expectation that they’d receive it. I do think there’s more negotiating and more pressure on budgets from the perspective of “give us more”.

DARCY NEIGHBORS: We do a lot of retainer work for larger companies. What it comes down to is, they don’t want to be billed hourly. They don’t even want to throw that number out there, even if there’s a blended rate for a retainer. [Clients ask], “What is the value that you’re providing me? Is it increasing my overall case load? Is it increasing my bottom line revenue?” They don’t want to talk about the hourly stuff at all.

ROUFF: We’ve stopped bidding hourly completely as of a couple years ago. Here’s the price. Here’s what you get. Then the only reason we keep track of hours is, it helps us not overwork an account internally because the value of what we do is not based on time. My business partner, who’s a really great graphics guy, somebody will ask him how long it took him to do a logo. He’ll say, “30 years,” because that’s how long he’s been doing it.

ROB GAEDTKE: We work almost entirely  on fixed fee, project-based [work]. We’ll bid a project. If the value to the client is much stronger than an hourly rate, then that’s what we’re going to price it at. I think it goes both ways. There are jobs we’re going to get that we know we’ll spend an hourly rate more for, but again, that’s what that value is to the client. It’s our job at this table to prove that what we do makes an impact.

OUCHIDA: As marketers, we need to redefine what clients are paying us to do as an investment, not an expense. Too often, they look at it like an expense. If they just see it as an expense, they don’t give it the full chance for the brand to breathe, to gain traction and to have some resonance with the right market.

How are crisis management plans implemented with today’s changing media?

HOLLY SILVESTRI: The trick with a lot of crisis communication plans today is that it needs to be a quick turnaround with social media. Crisis communication is not something you can jump into too far after the fact; you’ve got to be immediate. If a crisis strikes, it’s going to be all over social media. You’re going to have people all over the place really coming down on you. You’ve got to jump in and be able to address those concerns and those comments immediately. Every crisis plan we’re writing now includes a social media element.

TROSPER: We just went through a tabletop exercise with one of our clients. Social media was a strong component. They had “ghosts” come in and say this picture just appeared on Twitter or this just happened on Facebook. They actually had that built into the plans and they were throwing it at us asking what we were going to do. I thought that was great, that some firms are actually getting to that level where they’re allowing [their marketing firms] to be a part of the operational exercise and make them an integrated part of the team.

How have staffing practices changed in recent years?

GAEDTKE: We don’t have any policies for working from home. You can do it anytime. All I care about is if I can get a hold of you and I can talk to you whenever I need to talk to you. There’s a level of trust, especially with the younger generation, and that’s the type of trust that they need. If you hold them accountable to a deliverable, that’s all that they care about. What we find is, at any moment, we’ll probably have half the staff in the office. But when there’s something going on, everyone shows up everybody’s loud and talking. We allow them to do what they want and performance has been amazing.

NEIGHBORS: We recently moved and we incorporated a more open space environment where there aren’t many offices at all. The idea is they’re all in the office Mondays and Fridays and then there’s a rotating schedule for them to work from home Tuesday, Wednesday and Thursday. It’s been working extremely well. The productivity that I’m getting I’m blown away with. As long as they know that the client comes first, then we do that. You always have to work around the fact that the younger set is going to travel and they’re willing to work without pay if they don’t have enough time [saved up] to take off.

WARREN: My employees dictate when they work from home at any time, as long as they clear it with me or a supervisor. Because of that, I think it’s instilled a lot of loyalty in our company because a lot of these people realize they couldn’t have this kind of flexible arrangement. There are always those times when there’s an important client event or meeting that they have to be present for and they have to figure it out. But what I’m finding more is that people are in the office less and less, but productivity is going up. One of the down sides of that, though, is sometimes I feel like we’re lacking in camaraderie because we’re hardly ever in the office all at the same time.

QUILLIN: Our agency is much different in a couple ways. Our culture and the relationships between our staff is critical to our success and the attractiveness we hold for clients. Our interaction, collaborating, brainstorming, it’s so integrated that we really do need to be there as far as physically being in the office. At the same time, if somebody needs to go somewhere or something comes up, we’re really understanding with that. Again, it goes back to getting the job done. As long as you get your work done, that’s all that we’re looking for. I guess we’re old-fashioned that way.

TROSPER: Were a little old-fashioned too. We’re all in the office all the time. If you do have to do something, you’re an adult so go ahead and take care of it. Again, at the end it’s the deliverable and it’s that level of trust and fostering what you have within the agency. I love having everybody brainstorming together and working to come up with solutions because somebody has a great idea sitting across the table that fixes everything.

SILVESTRI: I think it depends on what’s needed. If you’re doing design, it’s easy to have somebody in Missouri do design work and send you something. If you’re doing event planning and coordinating a major PR campaign for a client, it’s nice to have everybody there to brainstorm and team up and do the work together. We do half-day Fridays. We do a lot of family days. We do a Ferraro Group trip every year to another city and a retreat. But when it comes to Monday through Thursday, it’s pretty hardcore. We’re brainstorming and doing work together.

How competitive are out-of-state agencies?

ROUFF: You’re never a hero in your hometown, is what it boils down to. There’s an allure to Chicago, New York, LA and  San Francisco [agencies]. For a number of prospects to say, “I’ve got this firm in Manhattan,” or wherever it might be, they’re getting some type of emotional and psychological benefit out of that. We’ve certainly lost all kinds of bids to out-of-state firms. We’re not just competing with each other.

OUCHIDA: We deal with that all the time. Each one of us possesses so much institutional knowledge of this incredible town that has so many idiosyncrasies to it. We just possess decades of information, contacts, connections and influencers. I really think that is a strength for us in the room. If you need to make a phone call or have access to somebody, you can. More times than not, [out-of-state firms] try a “cookie cutter” approach and it fails because they are really not going to understand the market and the way this town ticks.

PAUL STOWELL: I can attest to that, working for a large firm like City National Bank, coast to coast, and having those experts in the various markets. Having someone on the ground that understands the local issues and the nuances of that market is important to City National. I take that “cookie cutter” then we customize it for this market for the entire state of Nevada. I handle markets outside of the state as well and we do that same thing. Then you amplify that to our parent company and they’ve actually decentralized their marketing approach worldwide. They recognize the importance of having locals that understand the market from all aspects, not just for marketing, but for the political and the regional issues that impact us.

TROSPER: A third of our clients are from out of the state and we’re hired specifically for that. That’s to make the connections, to do the community outreach, make the introductions and make sure we get consumer or business buy-in here. I think that’s what makes us unique, too. I always tell them, Nevada is very different. That’s why we get a lot of work, because we are so different here. Our clients are mature enough and smart enough to realize that.

SILVESTRI: Statewide, Reno is completely different from Las Vegas. So, it’s not just about a Nevada agency handling statewide stuff, we’re different all over the place and that’s something to consider. We’ve gone against firms that are national, but we end up winning the account because people realize you need to have that local presence. Also, on the other side, we had a client come to us and they’re opening up in Texas. I recommended they hire a local firm in Texas. I’m not going to take on business that I know I won’t succeed at. That’s something we have to be honest about, too.

What is the outlook for traditional marketing?

PAULA YAKUBIK: For us, we do a lot of Medicaid marketing internationally. Our potential people that we need to reach are still reading the newspaper. We find our clients, because our digital efforts are trackable and they can see the progress, they want to put more in digital. Where we’re pushing them to do a little more traditional and keep that up, they are pushing away our traditional budgets and moving more to digital because they can see the leads and conversion. I think it depends on who you’re trying to target and how the marketing director looks at the KPIs (key performance indicators) and the dashboard, really.

SILVESTRI: It’s kind of a combination. Traditional is wonderful and digital is extremely important and growing. Community outreach and touching those audiences is crucial. But we have the same thing with our clients who are trying to go in a certain direction. We’re explaining that you can reach an audience in a variety of ways. That includes traditional, too.

NEIGHBORS: I would back that up. I would say that it comes down to any time we look at a new client, we do a strategic marketing summit. If they don’t see our recommendation, that we need to have that holistic approach, because I still think there is tremendous value in traditional, then it might not be the right fit for us. The best client is the client that understands that it all works together and that all of this is going to help grow the brand.