With budgets tight, staffing levels down, and competition fierce, agencies—and their production departments—are becoming even more creative in their choices, their venues, and their budgets. "The pressure is on us to produce efficiently and cost-effectively," says Jonathan Davis, executive VP/director of broadcast production at Leo Burnett USA, Chicago. "We’ve had to adapt and get a lot smarter. I can’t foresee that pressure going away."
The last year has proved trying for the ad industry, with the events of 9/11, as well as the downturn in the economy. It’s also been a year filled with layoffs of seasoned agency professionals. Fairly typical is the production department at Leo Burnett, which is ten percent smaller than it was last year. Similarly, Fallon Minneapolis, cut back its staff for the first time in 21 years. The result? A savvy ad shop producer looms as pivotal in the success of a project. "The cutbacks mean you run leanly," says Matt Bijarchi, director of broadcast production, at Young & Rubicam (Y&R), Chicago, who says that his department has not faced any reductions recently. "You’re expected to run a tight ship. Everyone is watching the bottom line a little more closely."
"Everyone is understaffed," says Nancy Axthelm, executive VP/director of broadcast production at Grey New York. She says she keeps a close eye on staffing levels. "We’re constantly looking to see if the amount of work can justify the amount of people. It’s an interesting juggling match."
Stagnating budgets and decreased board flow have meant changes in how agency producers deal with production companies and other vendors. "Production budgets are not [necessarily] shrinking. They don’t go up, but they don’t decrease per se," says Davis. "They stay the same—which means that they have [actually] gone down because of the rate of inflation. So it gets tougher and tougher."
"Every budget is a challenge," agrees Ken Yagoda, managing partner/director of broadcast production at Y&R, New York. "But that is not new. We are under more scrutiny now; there are a few more questions about why we are doing it this way, and it take a little longer to get a signature [of approval], but being vigilant is part of the job."
It also means being more creative with budgets and other resources. For instance, agencies have gone abroad more because dollars go further in certain overseas locales. "You find new ways to get the best results for the creative on the table," notes Davis. "To produce to the standard we’re used to, more stuff seems to leave the country these days."
"You want to find ways to keep the work here," adds John Noble, VP/director of broadcast production at The Martin Agency, Richmond, Va. "But it’s a global market now. I can’t say it’s necessarily a bad thing to compete that way. You want to stick by U.S. vendors, but you need to make the job work. It’s a dilemma."
Others find advantages besides costs in going overseas. "After the [2000] SAG strike, we had good experiences in places we didn’t know much about," recalls David Perry, director of broadcast production at Saatchi & Saatchi New York, who cites Australia, Germany, Spain, and South Africa, as overseas locations his agency has since gone to. "It’s not just money. It’s fascinating if you work with a local director; you get a whole different take on filming than you get in the states. It’s eye opening. You can’t go shoot in New Zealand without sensing that they operate a little differently from here. If you’re going to produce global work, you’ve got to keep your eyes open. There’s a lot we can learn from these folks."
There is also greater willingness to experiment with new technologies. Some say there are more occasions where directors and clients are willing to shoot digitally if the idea warrants it. "More U.S. directors seem to be gearing up for it," Davis notes. "When you talk about making money go further, that’s one idea that comes up."
With cutbacks, there is more diversification at the agency level. "All the departments are much leaner as a necessity, which should not be a surprise to anyone, so we’re all asked to do more," explains Yagoda. "That is not necessarily a bad thing since it provides more opportunity for producers to work on a broader range of accounts."
Partly as a result of the cutbacks and also because of the tighter budgets, the production departments get involved in the jobs earlier. "One of the things that has happened is that, because staffing is tighter, there are fewer people working on more things," says Yagoda. "So there is more of an ongoing dialogue than a bunch of separate processes. You find you are involved earlier."
"The time frame is shorter [to produce a spot]," Noble concurs, "and the budgets are tighter, so there’s no time to create a project and retrofit, or mold, a budget around it. Now it’s ‘here’s how much money you have. Make it work.’"
Axthelm agrees that such early involvement is crucial if the agency wants to make more with less. Frequently, the production department will weigh in on the best process to utilize for the desired effect—before the budget is set. "In the old days, we’d only be brought in after everything was nailed down," says Axthelm. "Now we are asked to give a range of options in pre-production. It’s exciting. We are called upon to be inventive and make the most of what we have. The producers and the creative team are working tightly in production. It’s much more collaborative."
"Our producers are involved from the initial start-up," says Mark Sitley, director of broadcast production at the Minneapolis and New York offices of Fallon. "We get in on the strategic planning, then comes the assignment, then we come up with the budget to produce."
The relationship with vendors has changed, as well. "There are fewer of them, for one thing," observes Yagoda. "I find there’s more collaboration—there’s a greater good than just winning the job. When the economy is depressed, there’s more of a willingness to collaborate to create a work environment where everyone is helping out and trying to make the process work."
Axthelm notes that times are dire for production companies and post facilities. "Many are going out of business," she says. "The economic downturn has had some serious repercussions. It used to be a year-to-year business; now it’s month to month. Things are tight for us, too, so we’re not able to financially help that slide."
As a result, vendors are more willing to take jobs for less and are in some ways more accommodating. "Everyone’s being smarter," notes Bijarchi. "They know our clients are more cost conscious than before. With the downturn, with the strike, they know we can produce more for less, so smart vendors are doing what they can to cut costs to help us out. It’s always a fine line: you don’t want the campaign to suffer."
"They’re helping us stretch the dollar," agrees Noble. "Vendors are pushing to find cost savings because a lot of them are hanging in there right now trying to keep the businesses afloat, hoping for better times."
"I’d say that suppliers are more anxious to work with us and with our budget," Perry notes. "Before, they might have turned something down, now there’s more willingness to rethink it and take the job. Relationships are more collegial; they feel we’re all in this together and we need to find a way to get job done."
Another change is in directors. The number may not be shrinking, but the amount of work is, meaning that ‘A’ level directors get more of the jobs, squeezing out the ‘B’ level helmers. In addition, some agency producers say there is an oversupply of new or newish directors. "I think that directors were brought into the business without a real strong plan as to how they would be absorbed by the industry," says Perry. "Directors were developed for whom there was no crying need. In the ’90s, every time I turned around, there was a new director’s reel on my desk. And when supply exceeds demand, that makes for a buyer’s market. There’s just not enough work to go around."
New Ideas
Some production heads note that with the bad economy, some clients don’t want to take chances. "A lot of clients are afraid to take risks right now," observes Bijarchi. "From an economic standpoint, everyone is in the same boat. The ramp-up has not happened yet. The economy is not in great shape now."
Others, however, say that exploring new options and thinking outside the box are crucial to survival. "It’s time for some of the clients to step forward and take a leadership position," says Yagoda. "A lot of clients are cowering; but now is the time to differentiate yourself from others."
"We are searching out new media," reports Sitley, whose agency was behind the Web-based BMW short films directed by A-list feature helmers, with production by bicoastal Anonymous Content; the agency is currently working a second series of films, this time produced by bicoastal RSA USA. "The key is to find a fresh way to keep brand identities in a non-patronizing, non-cluttered way."
As for the future, many say the previous trends will roll over into the next year. "I think we will continue to do more work with fewer people and we will be going out of country more," says Perry. "I’m limited as to how far ahead I can see. I believe television will remain the basic advertising media. From what I can see, most futurists have constantly misread the future. You know, I’m still doing what I’ve done for thirty-two years: making thirty-second TV commercials. And I don’t see that changing."
But some are reluctant to make even such basic predictions. "They say if anybody could have predicted the events of the last year, they should be under arrest," notes Yagoda. "So I’m not predicting anything."
