The real cost of cutting costs

Real Cost

Reduced budgets. Belt tightening. Downsizing.

Seems like everyone is looking to reduce costs.

All the time.

“We need to do it for less” is the mantra of our times.

“Why?” “Well, … because.”

If I’m honest it’s not clear to me why anyone would actually believe this to be a good idea.

To be sure, the world is not short of big brands with the wherewithal to apply a boatload of downward pressure on their agency or design group.

Don’t want to submit to the new budget parameters? No worries, there are plenty of other potential partners out there that will. 

But is it really a sound strategy?

Is the knee-jerk of cutting agency fees (and expecting more out of them) or halving last year’s production budget really such a no-brainer?

The agencies that agree to the reduction will only pass on the pain to their vendors. Or they’ll try and keep it all in-house

To compensate for lost revenue they’ll fire the more expensive senior members on their staff and replace them with cheaper, younger ones – bright, eager and inexperienced.

They’ll also opt for people who can be utilized in a number of different ways – Jacks and Jills of all trades who’ll sadly be masters of none. Perhaps a junior exec who can take good meeting notes, knock out a brief and do a little social. Or a tyro Art Director who can also point a camera, edit a little, and dabble in after-effects.

The work gets done. 

But none of it is great. In fact, it’s deathly average.

And if the work is inferior, you can bet the results will be, too.

Ineffective work. Indifferent performance. Damaged brands. Not good.

That’s why it’s crunch time for those who know that this is a fool’s errand.

Who’ll be the first on either side agency/client divide to say “Enough”? Who’ll be the first say to their immediate superior “If were going to do this right, I’m going to need more resources.”

Never going to happen I hear you say.

Perhaps.

But I’ve yet to see a brand save its way to success.

Or cut its way ahead of the competition.

On the other hand, I’ve seen hundreds of great ideas – fully invested in and realized to their full potential – transform a brand’s fortunes forever.

Because a great idea is worth its weight in gold.

What’s more important?

What can be saved?

Or what might be lost?

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