The previous installment of this article series described how the changing environment in the new economy is raising the stakes for top advertising agencies. I had the great opportunity while in Paris recently to interview Jerome Guilbert, chief strategist at BETC EuroRSCG, part of the global powerhouse Havas. Guilbert is among the best in the trade, working within one of the most successful and expansive agency empires in the world. The French unit with which Guilbert works is, in fact, the top CRM consultancy in France, as well as being a market-leader and thought-leader in global advertising strategies.

As we discussed last time, the progressive advertising agency in the new economy must help clients monitor and manage buzz, as well as any other channel where a prospect’s or customer’s perceptions are shaped. Guilbert and I talked about how top-performing ad agencies must lead the way in improving customer intelligence, channel management -- and corporate culture. After all, developing a customer strategy is not an abstract exercise. To succeed, it will probably impact much of your organization. This is why CRM is not a project, it is a corporate strategy.

Guilbert was comfortably seated across from me on the chic lime-green, low-slung modern couches that communicate the company’s commitment to design – and to creating a great working atmosphere.

PKW: What do you do about getting clients to think about customer issues?

JG: Customer centricity is one of the main issues when we start talking with a client. Organizationally, our clients keep customer data in various departments. Sometimes to get basic data, we’re working with the marketing director, sometimes the survey department, or even a “customer insight” department. Having a customer insight department at all is rare, but we’re seeing it happen a little more often, and we think that’s a good sign.

Unfortunately, the people who handle data at many client locations aren’t really part of the community [of decision-makers] within the organization.

The first issue is that some clients don’t consider that marcom – and the ad agencies supporting marcom -- should be kept informed about the brand. In fact, most of my issues in developing an ad campaign are strategic brand issues at the core. So not sharing this kind of brand strategy information with big-picture agency like us is a cultural issue.

The other issue ad agencies face is a power issue. Most of the time marketing directors or communications directors don’t want to give us the information they have about the customer. If I could have things my way, I’d have complete transparency of customer information.

So to overcome such issues we gather data by ourselves about clients. It's actually the primary task for planners. At BETC we try to be as close as possible to consumers. For example, to understand better the gas station business, I've driven all over Europe and stopped in every single station I met for interviewing consumers. Or to understand better public transportation everyday users mindset, we give them disposable cameras and ask them to snap whatever they think would be a good example of the metro experience.

PKW: What kind of questions do you need your clients to answer before developing a strategy for a brand?

JG: When we develop a strategy we focus on the opportunities of the business, which are most of the times emerging needs we want to preempt. It seems that opportunities become a key thing to focus on, instead of the conventional positioning issues that marketing community have always been obsessed with. And to identify opportunities, you definitely need to develop knowledge about where consumers are heading.

In doing so, we may find difficulties to get precise data from clients.

The first thing to realize is that France by itself is not a customer-focused country. We have no tradition of focusing on customers. Our big tradition of marketing has been influenced by structuralism. A lot of people in the business do so-called research without talking to the customer – it is all theoretical. While certainly it’s a French trend, I’ve seen it also with our foreign clients.

This is why the impact of what we do depends on the client [and their willingness to develop and share customer data]. Let me give you an example. We work with a big global retailer. They tend to think that we should develop our ads without consumer information. They have the mindset that ad agencies just make ads. Their view is that we are creatives. They seem to think, “Let’s give them a brief and they’ll do something magical.”

PKW: The work you do is just a black box to them.

JG: Exactly. Of course, this client is an extreme case. Most of the time, actually, when we ask for customer data, they say, “Do you really need to know these things?” Then you ask questions that they don’t know how to answer.

I think a big problem that gets in the way is a perception about the role that ad agencies should play. A company tends to pay ad agencies for their work, not for their thinking. There’s no money to develop consumer knowledge. And some companies think that’s a good thing. You have this idea that consumers don’t know what they want. Since they don’t know, don’t ask them.

PKW: Your clients sometimes think you just have to tell the customer in advertising what to think about the brand, instead of finding out how they perceive it. Right?

JG: Yes. The opponent of customer-centricity is brand-centricity.

The idea of brand-centricity is also widespread in the planning [advertising] community. It’s as if agencies are saying, “We want to design the brand with what the brand leader/owner [who manages the branding within a company] wants.”

The very idea of brand-centricity lets you save money because you don’t have to spend anything to develop customer information.

In effect, you have a freedom domain between what you know about your customer and what you want to do.

PKW: What kind of questions do you ask your clients today that you might not have been asking them a decade ago?

JG: I’ve been in the business fifteen years. Today, I’m asking more precise questions about who their customers are, and I’m using and developing information for things like planning media consumption. I’m using funny names for clusters [of customers]. I ask questions about how my client is actually organized around consumers. I would try to figure out their knowledge management model. I don’t think there was much in the way of KM in the area of customer insight ten years ago.

I think the big change is the methods we use for finding customer clusters and that we know more about their behaviors and preferences. That lets us do more precise things.

PKW: At the end of your service to a client, what do you hope you have left them with that would be a permanent benefit to them?

JG: Well, I think the question is interesting, because mostly our clients just don’t leave us. Plus, it’s more difficult for an ad agency to fire clients, and it’s not our culture here. We have a great pride in the brands we manage and we want to stay a part of growing those brands. And the fact is that, even though contracts are for three years, the clients just stay with us. We are in essence completely in charge of the brand during that time. There is no reason to walk away in this circumstance.

But when we do part ways with a client, we want to feel we have given them a strategy that will serve them well for a long time.

[end interview excerpt]

In the final installment of this article, Guilbert reveals his view of the changing role of agencies, and the implications to his sector and to his clients. Looking at these trends from the CRM perspective, I will draw some conclusions about how C-suite executives may be maturing in their approach to developing customer strategies – and that this may be creating a disruptive change in how services are bought, sold, and measured.

In the meantime, I’d like to make a couple of observations about Guilbert’s insights so far.

Guilbert struck me as being passionate about developing customer intelligence. Yet his clients can provide this intelligence only inconsistently. Either they don’t have the data, or culturally they have a hard time sharing it. And of course the state of the art of developing customer insight practiced by EuroRSCG is likely to be far more advanced than what its clients practice.

While our interview was more about customer intelligence than detailed CRM, the implications for CRM are clear: Any CRM initiative will meet the same organizational and cultural challenges faced by an agency of EuroRSCG’s caliber. The right people, at the C-suite level and below, must accept responsibility for developing and sharing top-quality customer data transparently, within the organization as well as with strategic partners.

As I shared this time with Guilbert in EuroRSCG’s chic, sophisticated offices on the Right Bank of Paris, it suddenly struck me that the biggest agencies in the world have the same issue that we small consultancies struggle with. Clients resist change, even when it is in their best interests. Note to self: Educate my clients more consistently, completely and authoritatively so that the resistance to change is replaced with an embrace of opportunity.

The big picture consequence of what I’d heard so far is that companies sometimes miss a huge competitive opportunity if they don’t engage their agencies completely. It is a fundamental strategic error for a business to consider a top agency such as EuroRSCG merely a vendor providing a few paid deliverables. And yet to embrace such an agency as a strategic partner has deep consequences: You’ve got to commit to deeper awareness of – and insight into – customers.

Guilbert said, “In effect, you have a freedom domain between what you know about your customer and what you want to do.” Another way of thinking about this is that your organization has no freedom when you know nothing about your customer. For building a brand, or a CRM system, the logic leads inevitably to a critical observation: To build more strategic freedom for your company – to survive in the increasingly challenging new economy – you must start with customer insight. There is no better investment you can make.

Company: pkward.com