Ex-Lever chief slams agencies

Advertising agencies are burdening clients with unnecessary costs, former Lever Brothers UK managing director Andrew Seth told a Laser sales conference of senior marketers last week.

It is his first public speech since quitting Lever at the end of March – revealed exclusively in Marketing Week (MW February 17). Seth, now a marketing consultant, attacked in particular agencies that bump up costs through integration.

“There is a huge amount of irrelevant cost in agency structures now, not only nationally but internationally,” he said. He added that agencies risk losing their specialist expertise at the cost of being “all things to all men”.

Seth said: “Why are clients having to pay for pitches such as the one for BA? Agencies say they are. But everyone knows we are.”

He also told delegates that among manufacturers and their agencies “brands and brand differences have taken second place” to short-term issues such as financial results, share prices, retailer relations, operating procedures and cost-cutting.

He added that in agencies “brand-building is taking second place to making jokes in clever ads”. In the face of retailer power, manufacturers will have to seek “entirely new methods of distribution”. And if agencies continued to offer “mechanical” approaches to brands rather than giving clients “insightful, visionary, long-term delivery”, then their days would be numbered.

At the same conference, AGB commercial director Judith Passingham said own-label and retail brands increased by 2.5 per cent last year from 36.4 per cent of the total packaged grocery goods market in the first quarter of 1994 to 38.9 per cent in the first quarter of 1995. The figures represent the fastest-ever sales growth for retailers, she said.