Agencies need to focus on the wellbeing of people and uncover ways for brands to continue cultivating consumer relationships, according to Marla Kaplowitz, chief executive of the American Association of Advertising Agencies (4A's).
The ad body has been monitoring how its members are navigating the challenges caused by the pandemic and subsequent lockdown.
Speaking during The Drum’s Digital Transformation Festival, she said brands are shifting away from the 'sell' at this time to embrace a longer term, brand building opportunity in taking action and having utility.
Kaplowitz said: “It's not about selling right now. It's about showing the actions that brands are taking. There's an opportunity for them to connect with their purpose, or reconnect with it. They can focus on community and help people through these times.”
In particular, brands are showing utility in driving the ‘stay at home’ messaging that’s been pushed globally.
“People want to hear what are brands doing to help during the crisis," she said. "Actions mean more than selling right now.”
The organization opened up on how agencies are navigating the challenges of the pandemic with a reduction in spend forcing the hand of groups to make cuts, furloughs and discard bonuses.
Kaplowitz said: “The agencies are focused on their people. Making sure that they are safe, healthy, and even employed. Next, for clients, they are being proactive and having conversations about the business, creative, media, and the new financial terms.
"And then finally, they're looking at expenses, and where they need to cut."
Uncertainty remains around how long the lockdown will last, so for many, it remains business as usual - even from home. But not all agencies have been hit equally.
“The impact of the agencies really is sector dependent," said Kaplowitz. "If you are an agency that is highly dependent on travel, hospitality – even government clients – you're going to be more impacted than those who are in FMCG, food, beverage spirits, and personal care.”
Some sectors are booming and are fighting to remain front of mind by advertising. The reality is that supply chains have taken a hit by the furloughing of staff in 'non-essential' industries, so this advantage is limited to a select few sectors.
Next, Kaplowitz discussed the impact on independent agencies. They are unlikely to have the cash reserves of the networks to ride this out.
“Many of them are being proactive and looking at a combination of furloughs, salary reductions, and are addressing their expenses," she noted. "But more importantly, they're focused on their clients. It's important that they're still addressing new business opportunities and figuring out ways to keep the business going.”
Earlier on in the festival, Pizza Hut’s chief marketing officer Beverley D'Cruz also urged brands not to pull back their media spend.
With a looming recession and a slew of business challenges, spend is evaporating in many quarters – against the consensus that this is exactly the time to spend for many.
For many, this will mean considering new channels, altering creative and setting new objectives fit for the new reality.
Despite the difficulties, the industry pushes on. For many, the pitches continue, albeit online. Kaplowitz noted that more work is shifting to a project-by-project basis opposed to the retainers we’ve seen.
“New business is the lifeblood of an agency. And it's so important to keep it going. It is also where the true creativity tends to thrive and people come together. So my advice is continue to pitch."
And as for the long-term learnings, Kaplowitz again insisted that everyone takes time to focus on humanity and people.
“All of the other issues that we've been dealing with are important, but they just don't feel as important today," she said. "Agencies are there to take a client's most challenging business problems and come up with a creative solution.
"Hopefully, this is a reminder of what an agency is there for."