Combined Clout

A merger of the IPA and SPCA now seems a likelihood. Will an umbrella trade body give smaller, independent agencies more clout, or are they at risk of seeing their cause diluted?

It is a year now since the news was first revealed that the Institute of Practitioners in Advertising (IPA) and Sales Promotion Consultants Association (SPCA) were in talks about forming a combined trade body. The two trade associations are still talking – but the merger now appears to be a matter of when and not if.

By all accounts, the SPCA worked hard at being as inclusive of its members as possible – canvassing their opinions and votes at every stage. Nevertheless, there are still concerns – mainly voiced by small and medium-sized agencies which wonder how they will fare and how their interests will be served in a large trade body full of large advertising agencies.

There is no doubt that the SPCA had to do something to change. The trade body has a good reputation for championing issues such as best practice and remuneration, and its annual awards scheme is well thought of. But it is not a body that carries much commercial or political clout – particularly when compared with the Direct Marketing Association.

Indeed, there is a view that the SPCA is not much more than a networking club. The attendance has been so low at the past two meetings that there were not enough people to achieve the minimum votes needed to pass any resolutions.

One person who took the trouble to attend the most recent day-long meeting says that, as she was leaving at the end of the day, those people only interested in having a couple of drinks with friends after all the work had been done arrived in droves.

Membership has also been all a bit fluid. Ammirati Puris Lintas, which joined the SPCA in 1998, walked off with a clutch of awards at the SPCA Best Awards that year, never to return – not even in its new guise of Lowe Lintas. Episodes like that don’t enhance the status of a trade body.

So far, the discussions around the merger have tended to concentrate on the need to avoid the SPCA and its members being subsumed and lost within the larger and more powerful IPA. Indeed, ex-chairman of the SPCA and president of Marketing Drive, Clive Mishon, has always been adamant that the SPCA would not be merged with the IPA and made it clear that negotiations would be called off if there were any chance of that happening.

Given this background, it would be easy to forget what the SPCA and its members will bring to the party. After all, the IPA would not have embarked on this proposed merger if there were no benefits for itself.

The truth is that sales or marketing promotion agencies have a reputation for being quicker to react to client demands and more responsive to consumer needs. The whole world of e-commerce, viral marketing and the Internet in general has also been embraced more comprehensively, and confidently, by below-the-line agencies than their above-the-line counterparts.

But the SPCA still needs to be aware of the concerns of some of its members. Russell Abbott, managing director of WDPA, a small independent sales promotion agency, says: “As an independent, I believe our voice may be diluted if the SPCA merges with the IPA. It will obviously benefit the major groups which have aboveand below-the-line agencies within their portfolios, but whether it will be good for agencies such as ourselves is debatable.”

The crux of Abbott’s argument has to do with how clients view agencies rather than how agencies view themselves.

Abbott says: “The bigger fast moving consumer goods clients that we work with still want one big ad agency and then shop around for a few below-the-line agencies. At the moment, the SPCA does a good job marketing agencies, like ourselves, to clients. But I worry that, in a merged body, the large groups will benefit enormously because they will be able to cross-sell to clients even more and there won’t be anyone representing our interests.”

Key disciplines

Abbott asks which key disciplines will be promoted, and who on the client side will the new body be targeting. “Different people on the client side take responsibility for different agencies. For example, the marketing director would be the first contact for an ad agency, but sometimes the brand manager is responsible for appointing a below-the-line agency,” he says.

Willox Ambler Rodford Law partner Max Law agrees and says that despite all the rhetoric about integration, “The truth is that client companies are structured in such a way as to restrict decision making”.

Law describes Willox Ambler Rodford Law as an integrated agency which has clients that use it above-the-line advertising work only. He says that although the agency has always marketed itself as integrated, it is not an easy task because “there is still a polarisation in the way clients approach above-the-line and below-the-line needs.”

He adds: “The SPCA has always referred to itself as an agent for change and as a client-facing organisation: there has always been the feeling that the SPCA could change attitudes within clients and get them to understand its members’ role better. I think it’s ironic that we are on the point of allowing ourselves to be merged into the IPA and possibly losing that focus.”

Mishon is very clear that the new organisation will represent the interests of all agencies and says one of the reasons for the merger is to move away from an emphasis on discipline and concentrate on the fact that everyone is an agency.

He says: “Because there are more agencies practising a number of different disciplines, what is missing is a body representing the interests of those agencies. At the moment, trade bodies represent specialists. A merged body would represent the interests of all agencies – but not on the basis of what discipline they are involved in.”

United front

As far as clients are concerned, says Mishon, the body will face the world as a united agency front.

Mishon quite rightly points out that the duplication of work being done by trade bodies would be reduced. “The SPCA is working on a project investigating payment by results; this was originally done by the IPA and Incorporated Society of British Advertising (ISBA). We are also studying the issue of agency contract – that’s already been done by the IPA and ISBA. Instead of replicating work, a merged body could carry out the work at the same time,” he explains.

Mishon’s desire to strengthen the agency by offering as much as possible has meant that the DMA council, representing agencies, has also been involved in some of the discussions taking place between the SPCA and IPA. Although there is no suggestion of the DMA getting involved in the merger, there is speculation that the agencies represented within the DMA may be tempted to join the newly formed body.

Mishon is as enthusiastic about the merger as ever – but he appears more pragmatic when it comes to the timing. A 12-month consultation period was launched last October and it was initially hoped that a newly formed body would emerge at the end of this year.

Mishon says: “Some of the deadlines we set up for this were a bit ambitious and it might not happen in 2001. There are a number of age-old issues that need to be addressed and that is going to take time.”

Mishon is clear that if a suitable structure cannot be hammered out to suit both bodies, the SPCA will pull out. But he is confident. “I don’t believe the merger will be called off – but I think now it will happen at a slower pace and in a different way.” So the merger does seem inevitable and, on the whole, it appears to have the backing of the SPCA – but the dissenting voices must be heard.

More muscle

Jane Asscher, ex-Tequila director and now managing partner of newly-formed agency 23red, is all for the merger. She says that the more muscle the marketing services industry possesses, the better.

“We don’t have much clout at the moment; this merger is a good start. But even then, it still won’t have the muscle of the CBI. We need to have the power to talk to more than just clients – we need to be talking to government and to Europe. We need a body that can protect the interests of all those in marketing services.”

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