Creative Outsourcing – A Contrarian Viewby Mike Bawden, President & CEO, Brand Central Station As someone who spends a great deal of his time working with ad agencies and public relations firms located around the world, I found Dave Banerjee's recently contributed article to be of particular interest. While the idea of creative outsourcing is intriguing, I'm concerned that it may not be at all practical. Rather, I submit that the subject of creative outsourcing in the advertising industry is another hot news item which will continue to distract people from what's really "wrong" with American Creatives' passion for style over substance. We've seemed to have lost sight of the fact that "the big idea" Creatives are charged with discovering relates to strategy rather than concept. Over the past two decades, technology has allowed us to create more fantastic visuals (e.g. effects, images, typefaces, etc.) for less and less money. In fact, the cost for producing high-quality, four color collateral material has dropped considerably over that time - and special effects that were once the sole property of Hollywood can now be produced on the desktop with a machine that costs less than $5,000. Delivery methods for these images have also multiplied significantly since the 1980's. There are more media channels broadcasting more hours of the day - and media has become much more intimate (wearable, even) than ever. Market intelligence - driven primarily by technology - now provides us with a more in-depth look at micro-segments of the population. Data mining and analysis can provide exhaustive iterations of financial models and marketing scenarios. But in the same time period, there have been few - if any - strides in creating tighter marketing strategies and finding ways to pull it all together. In short, it looks like we've become so busy and so specialized, we managed to lose the message in all the media. I'm afraid trying to send some of the work offshore will only complicate things. If we can't communicate with the creative team down the hall, exactly how can we be expected to communicate with a creative team half-way around the world? Key Factors It seems to me that there are two issues involved in the debate concerning outsourcing creative work: cost and quality. The cost factors that most columnists and commentators seem to throw out as examples relate to television/film production. In fact, television and film production work has been sent off-shore for years. Whether it's location shooting in Canada or post production work in India, there will always be a market for this kind of thing. But there are some aspects of the commercial production process that will have to be done in the local market - specifically primary shooting. Actors need to "look" and "sound" local, as well. Limiting ideas to those that can be produced exclusively off-shore may be one way to avoid these costs, but the creative limitations may not be acceptable. While off-shore television and film production is a possibility, interactive production is a reality. Off-shore programmers are already developing web sites for US companies and foreign art directors are providing designs for US companies to consider. All of these options seem to provide a cost-effective alternative to standard practices in the US. But there are a few significant problems: - While hourly rates may be lower for several of these services, the effectiveness and efficiency of these service providers still has to rely on management of the project by the client and the person or firm representing the service provider. Unfortunately, in most cases, inefficient project management derails projects faster and more severely when dealing with off-shore creative/production talent than it does with on-site, domestic talent. - Managing payment and performance can be problematic when dealing with off-shore talent. Unless you have a system set up to deal with the financial and legal aspects of off-shore projects, clients can find they've paid significant amounts of money and have no recourse when it comes to lack of performance or failure to deliver on time. - No matter how high the production values are, or how cheap the price is, if the material produced by off-shore creative talent is culturally irrelevant, it's not going to be effective. Cultural relevance is achieved by dealing with people who are familiar with the nuances of the local market and that requires time spent on-site. And if that means bringing the off-shore team to your location to get inculcated, many of the cost savings are wiped out with no guarantee the team will "get it" after their time spent in the USA. Whether the creative resource is located domestically or off-shore, the key to great advertising lies in the hands (and often on the desk) of the account manager who has to work with the client to create the insights and the strategy creative, media, PR and interactive specialists need to do great work. Outsourcing isn't going to improve that - only training and practice will. A Boon To Small Brands? Is creative outsourcing to off-shore resources really going to help small businesses and their brands? I think it's very doubtful. The reasons used to justify creative outsourcing just aren't relevant to small marketers or many B2B/Industrial advertisers. Small marketers, who rely a great deal on locally produced work, local images and local contacts require local support. More importantly, small marketers and their small brands often lack the education necessary to understand what "better advertising" looks like or can do for them in the long run. Just like with the big brands and the big agencies, there will be opportunities to use off-shore resources to produce and support marketing efforts at a lower cost basis. But small marketers and their brands require even more counseling, clarity of thought and coordination of services than their larger cousins. In fact, many small agencies outside the major metro areas have been practicing integrated marketing communications (IMC) - for decades before it was vogue in the larger markets. Domestic Outsourcing Opportunities Believe it or not, the threat of using off-shore resources for creative (and related) services may actually be a boon to smaller marketing service companies located outside the major market areas. Using the same arguments and technologies cited in the previous article by Mr. Banerjee, large agencies and marketers can form alliances with smaller, independent shops in other parts of the US that operate at significantly lower rates and leverage that cost difference to their advantage in the following ways: - Cost - smaller shops in the Midwest, South and Southwest have hourly rates as low as $14 per hour. Large agencies or marketers who approach these shops on a contractual basis could purchase large blocks of time at a low or discounted rate, essentially filling up unsold or unused time for employees at these agencies and creating an immediate talent pool available on an "as needed" basis. - Language and Culture - while there are some cultural differences between city mice and country mice, the common language, media and history will make for an easier transfer of knowledge than trying to do the same with colleagues who have a different native language, political/historical perspective and no working knowledge of the US media culture. - Time Zones - there is a definite appeal to the idea of e-mailing a job brief to your creative team in Asia and having concepts in your Inbox when you come in the next morning, but it just doesn't happen that easily. VOIP and webcasting are great technologies and make communication over long distances possible, but agreeing on a common meeting time between teams more than eight hours apart is difficult at best and can create inconveniences in employees' personal lives that are sometimes difficult to deal with. - Legal - working with outsourced teams in the US eliminates several potential legal issues. - Travel - only 30% of the American public has a passport and over 50% of the American public say they don't have any great desire to travel outside of the country (excluding Mexico, the Caribbean and Canada). In order to have an effective relationship over great distances, some face-to-face contact is necessary. - Financial - Domestic outsourcing means all of your transactions will be in US dollars and everyone plays by the same banking rules. I've seen international financial transactions (specifically the recall of wire transfers of payments) take months due to conflicts in international banking rules and customs. The solution to America's advertising problem isn't off-shore. There is no disputing Mr. Banerjee's point that American advertising is weak, an anemic version of its former self. And, in several cases, off-shore outsourcing is a valid and potentially revitalizing option worthy of consideration. But it's not the answer. The answer to the problem we're facing lies in the hearts and heads of the people who write the strategies and work directly with the clients. In most cases, they're the account managers. I can hear Creatives cringing all across America as I write that. But it's true. Without a sound marketing strategy, insights into the minds and hearts of the customer, a clear read on the internal politics of the client's organization, a defined budget, and a sense of where the next opportunities lie - America's Creatives are doomed. And so are our media professionals, PR practitioners, Web gurus, and account planners. It's up to the account manager to fill "the suit" and be what David Ogilvy said we all should aspire to be - an Ad Man. Mike Bawden
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