Lean times persuades agency to go back to basics; limits its advertising services to creative endeavors.

Lean times persuades agency to go back to basics 

Albright/Labhart of Los Angeles is an advertising agency that doesn't want to be known as an advertising agency anymore.

It reorganized last week due to what its principals declare are realities of the market. Although the agency called the move a split, it actually divided the firm into two divisions, creative and television production.

Albright/Labhart was formed 10 months ago as a full-service agency. Its founders decided they needed to be full-service to complete with much bigger agencies.

With the reorganization, A/L will no longer offer a full range of advertising agency services -- media buying, research, public relations, and a creative department. It will say, of course, that it's composed of creative people, but if you want other services, such as media buying or research, you can either go elsewhere or A/L will provide them via a subcontractor.

Also, A/L won't be doing much pitching for new clients. I've found in the past when an agency gets a new account it's not from a cold pitch but through connections, word of mouth, reputation -- something like that," says A/L creative director Michael Albright. "It costs a lot of money to pitch. We'll do it only if our expenses are covered."

Charging for the pitch might become another trend in the industry, along with the trend to specialty houses, which is what A/L has become. Albright will admit, if pressed, that it's all somewhat psychological.

Businesses perceive an economic downturn and, therefore, some are cutting back. Advertising often is the first expenditure to be cut. When potential clients look at fancy ad agency offices, crammed with bright, expensive employees, they might wonder who's paying for it all.

"Clients are fed up with paying a big overhead for an agency, something perceived as waste," says Albright.

He stresses the "perceived," which is where the psychological aspect enters. It may be that a client will not get services any cheaper from a no-frills agency that hires out talent as it's needed.

But the client may perceive a better deal. And perception, to a large degree, is what advertising is about.

"The more we talked to clients after we formed our shop last November the more we realized they really didn't want a full-service ad agency," Albright notes. "What they really wanted to know is whether or not we could help them out -- now, for a while. Not a concrete 'account' arrangement. So we've gone that way. And we think we're going to be on the leading edge of the business because of it."

Albright denies the move is due to the cutbacks which are affecting many local agencies. "We're doing just fine> our clients aren't cutting back," he says. "I read about tough times but I don't feel them."