The advertising industry is an extremely competitive and cutthroat environment. Companies use ad agencies to come up with top notch slogans and fix any image issues they currently have with their brand. The problem is, however, that it is a difficult task to create an internationally recognized slogan or brand. Companies tend to forget the time it takes to develop and nurture an idea to make it popular. With the impatience of today’s society and need for immediate results, ad agencies are being picked up and dropped faster than ever before.
Companies hire ad agencies for the creativity and objectivity they are able to provide. Their main tasks involve planning, researching, budgeting, and coordinating all aspects of the ad and then finally the actual production of the advertisement. They purchase advertising space and time through various media on behalf of their clients.
When companies are performing an ad agency review, they consider the agency’s resources, marketing abilities, creativity, production techniques, media experience, personality, and their references. In general, a company wants to be sure that their prospective agency has adequate resources and capabilities to serve the company’s needs. They look at the agency’s level of marketing expertise demonstrated, as well as examine their past work and clients. Their latest production techniques and their track record for managing advertisers’ budgets are also considered, along with the experience they have with various types of media. Finally, the company wants to make sure the ad agency is not working with any rivals or with too many other companies that they would not be able to focus on the needs of the company.
While ad agencies provide all of these types of services listed above, the latest reasoning for why ad agencies are let go has not been because of the aforementioned. More often than not, advertising agencies are being blamed for things that are out of their control. Carnival Cruise Lines is a good example of this type of behavior. Their cruise lines have suffered from multiple issues including breaking down while in use, the loss of dozens of customers’ lives, and the endangerment of the health of hundreds of others (Goldman). For example,in January of last year the Costa Concordia capsized which resulted in the death of 32 people. Then just a month afterwards, the Carnival Triumph suffered from an engine-room fire in February that left the ship powerless and adrift in the Gulf of Mexico (Goldman). Approximately 4,200 passengers were stranded on the ship with no restroom facilities, climate control, and also suffered from scarcities of food for four days before the ship was towed to shore.
With Carnival Cruise Lines continually disappointing customers and making headlines in a negative manner, it was not shocking to find their revenues were down $24 million and their share price fell 2.3 percent (Goldman). With all these issues amidst their company, Carnival Cruise Lines decided to release the following statement: “Carnival Cruise Lines is currently conducting a review of its media buying and planning agency resources [because it] has not conducted a review in several years and is currently seeking a media buying and planning agency capable of effectively building and managing integrated plans across both traditional and digital media.”
“Omnicom’s PHD has been selected as the new media agency for Carnival Cruise Lines, following a review in which incumbent Havas Media (formerly MPG) did not defend” (O’Leary). Havas media was a client of Carnival Cruise Lines since 2008.
Unfortunately, Havas Media was in no way responsible for the technical difficulties, issues, and unsatisfied customers that is resulting in Carnival Cruise Line’s loss of revenue. In the eyes of Carnival Cruise Lines, however, they need a bigger, better, and stronger advertising agency who will be able to cover and hide their bumps and blunders along the road. Since companies never like to point their fingers at themselves, ad agencies often take the blame for not attracting enough customers in, when it is actually the reported past experiences of the company that is driving them away. Carnival Cruise Lines needs to dissect what the real issues are before they can start generating revenues again. If they ensure that everything is working perfectly on their massive ships before they leave the docks, and combine it with great and attractive advertising, they may be able to see a turn-around for this upcoming year. The transformation, however, cannot be done by advertising alone.
Goldman, Bruce. “Carnival Solves Massive Ship Problems by Firing Ad Agency.”Examiner.com. AXS Network, 30 May 2013. Web. 25 Mar. 2014. <http://www.examiner.com/article/carnival-solves-massive-ship-problems-by-firing-ad-agency>.
O’Leary, Noreen. “Omnicom Media Agency PHD Wins Carnival Cruise Lines’ Media Account | Adweek.” AdWeek. N.p., 9 Aug. 2013. Web. 25 Mar. 2014. <http://www.adweek.com/news/advertising-branding/phd-wins-carnival-cruise-lines-media-account-151795>.