5 Minutes with… Steve Pacheco

Steve> The AAF is different from other trade orgs because we represent so many different viewpoints and perspectives from across the industry. It's not just the large holding companies. It's not just the big media players. It's our unique grassroots effort across the nation, the types of people we bring together. For us that really provides a richness of perspectives and a diversity of thought leadership that's very refreshing to me because it's so easy to get complacent and just think that you know everything about this business. And yet there are micro actions and small things that are happening at midsize and smaller agencies that are impacting the industry greatly. No one represents that group like the AAF does. We try to give a voice to people who don't have the power in some cases. Our tagline, 'The Unifying Voice for Advertising', is more than a slogan. What's important for our members to understand is that there is strength in numbers and collectively they can be heard in Washington DC and New York and across the nation, with their own voice representing their own unique perspective. The AAF is also made up of good, solid people who are working hard to make advertising better. I get excited about working with people like that.

Steve> It's twofold. Firstly, there are so many splinter groups and trade orgs that represent just agencies or just clients. We don't want to be that. We never have been that. We want to open it up. I stole a lot from the Hard Rock Cafe, which was started by a Memphis guy named Isaac Tigrett. Over the door of every Hard Rock is 'Love all, serve all'. That's a nice mantra, it means that anybody who walks in those doors will get served well and it's a place of love and support, and nobody's going to judge you. So, we love all and serve all, and we want to be able to make sure that we give our members a voice when they feel like sometimes, they're voiceless. The fact that we're based in Washington, DC - we're the only trade organisation that's based there – we're on the Hill every week talking to lawmakers, legislators, and policy makers. When we say, ‘here's a perspective from your home state,’ that really gets a lot of resonance there, because they do want to hear what's happening back at home. We can provide all our members a larger, louder voice than they might get on their own or trying to make some changes without the collective power of the industry. The industry also looks to us for thought leadership and perspective representing the full scale and scope of the advertising industry, all the practitioners, all the people making the supplier side choices for advertising, all the different pieces that must come together to make advertising work.

Steve> Part of it is to take on the perception that advertising is big, big, big business. And it is. But it is also a huge economic driver of local businesses and regional businesses. Every major US market has an AAF Ad Club, which is sort of the reverse of act global and think local, because you're able to activate at a local level with friends and associates and people you do business with. If you're going to survive or succeed in advertising, you're going to have to work with a wide variety of perspectives and backgrounds. We are a practical training ground for people to get thrown in and work with people who they might not always meet, for the good and the betterment of their community and their local activities. Almost every market does a public service campaign of some sort for the Ad Club there, which is a gift back to the community.  They can leverage their considerable power and privilege and skill set to do good things for the community that they live in. That's powerful stuff. That's showing the good side of advertising. And being able to activate at a local level is powerful and makes people change their perspective of what the power of advertising can be. 

Steve> I was a kid growing up in Memphis, Tennessee. I knew I wanted to be in advertising since I was eight years old, for whatever reason. Memphis was not a hotbed for advertising. And so, I knew that the only way I was going to be able to make connections was to find some type of way to jump in and connect and network with people who are really making things happen. That was New York or Chicago, but I didn't have those connections. I sat down with my college advisor, and he said, 'Well, there's this National Student Ad Competition that's put on by the American Advertising Federation, you get class credit for it. But it's also a nationwide competition, and if you do well, you keep moving up the ranks. So, I signed up, and found myself as leader of that organisation as a junior in college, and we competed for two years. During the second year, I figured out what I was doing, and we placed well nationally, which meant I had to go to the national conference and present, which was huge. I met Wally Snyder, who was then the CEO of the AAF, and he took me under his wing and started to introduce me to people. That year, the conference was in Portland, Oregon, and the hottest agency on the planet was Wieden+Kennedy working for Nike, and I could meet those people. I was a 20-year-old kid from Memphis that would never have had this opportunity if it weren't for the AAF. And a lot of hard work! But that to me became this on-ramp to all the things that I wanted. And it showed me that there's a whole world of people who are passionate about advertising like me, who just are in these little pockets all over the country. And that there's an organisation that connects them, and then networks them. So that was my first real touch, and I warmed up to it, I thought it was awesome. From there on, it was off to the races, I went on to be the local president of the Memphis club, when I became a professional. I served at the district level in several capacities, and I was the national board chair, back in 2013, in my role at FedEx representing them, and then when they had a change of the guard, the AAF called me to see if I would be interested in that. It was time for me to give back to the industry that's been so good to me. I want to help other young people in mid-major markets get access to all the great things that we do.

Steve> Well no organisation is perfect. From the outside looking in, I saw a lot of opportunities of running it more like a business and less like a club. We're a not for profit, but it doesn't mean we can't be profitable. Because we're 501(c)(6), the more money we raise, the more money we put back into programmes. We kept butting up against the capacity of what we could do revenue wise, and as a practical businessperson, I said that if we go out and raise more money and bring in more investment, we can certainly do more. We also started a 501(c)(3) foundation, the charitable arm, last year, which gives us an opportunity to raise more money and bring more awareness to what we're doing and offer more scholarships. From a business perspective, I saw a lot of things that I could tinker with and fix and maybe make better. I was really brought in to be a change agent and to make the AAF viable and relevant for a new day in advertising. As a person who helped lead a digital transformation effort at FedEx back in the early days of digitalisation, I knew that we weren't leveraging technology enough and that we weren't automating more of our processes and doing all the things that a successful business does. I hope that I've added a lot of practical business experience. I'm the first ever AAF CEO that didn't have a law degree. But I am also the first CEO that is a practical advertising person who came up through the ranks and can appreciate the business at a level of someone who has done everything involved in getting an ad campaign to market. It gives me a unique perspective to connect in a meaningful way with our supporters.

Steve> That's a great insight. I'd love to have the perfect answer! The year after Portland, I wound up getting to go to Minneapolis, which was a great design community at the time. Fallon McElligott Rice was there, they were doing some great work. Minneapolis was not on the map, much like Memphis, and yet, because of the strength of one powerful agency, they were getting a lot of accolades. The lightbulb went off that great creativity can happen almost anywhere. It's not just relegated to New York or Chicago, or LA. Covid really dispersed a lot of creative people all over the country, which was good for our business because now we've got clubs that are popping up in smaller markets that didn't have clubs before. It's a small world, after all, and the AAF network allows us to bring the infrastructure so that like-minded people who want to use their talents for good and get together and make stuff happen, and really learn from each other and challenge each other and get better at. 

Steve> DC is not the epicentre for advertising, but it is the epicentre for public policy and many things that impact advertising regularly. We're six blocks from the White House, we are in connection with all the lawmakers and legislators who, quite frankly, don't understand the business of advertising. If you go back and look at Mark Zuckerberg testifying in Congress, it's like a 'Saturday Night Live' skit: the people asking him the questions did not understand how advertising works. A lot of times, what we do is be informational and educational to help them understand the inner workings of advertising. It's also odd because most of them run campaigns to get elected to office at a local level, so they have interest, but they don't necessarily understand the workings and how it happens. DC is also run by a lot of young people, and a lot of the people we meet with are under 30 years old and came up as the digital generation. They understand a lot of the social media side of things and the platform side of things, and we don't have to do a lot of explaining to them. But the two and three term senators, we must explain a lot of things too. I think that lawmakers and legislators could learn a lot if they would open their doors and listen to us more.

Steve> We are all about a healthy advertising industry, so we want to continue to preserve and protect and promote the profession of advertising - which, make no mistake, is under attack every given day. It's an election year, so a lot of the states are looking at a potential advertising tax as a great way to raise additional revenue that they might need for shortfalls that have been created through no fault of advertising. So, we remain ever vigilant in DC about trying to stop advertising tax discussions. There are a lot of issues around data privacy that we have expert opinions on that we want to be heard. A lot of our big corporate partners use us for that type of conversation because it's something that needs to be understood by all around the table. I think the biggest thing that we can do, and the most important part of us, is to continue to show advertising as an economic driver of business and get us back in a healthy state economy-wise for the entire nation. We do state by state economic impact studies that show the value and benefit of a state like South Carolina. Whatever that state does, how many agencies are based there, how many people they employ, how much money they spend in state, what their payroll is like, all those things. When we go to the Capitol and talk to the South Carolina legislators, we're able to show them that. Suddenly, their eyes are opened because they haven't seen advertising economics as an entire viewpoint for their state. State by state and across the nation, we're able to show and demonstrate the impact and power of a healthy advertising profession and what it can do. The advertising industry is in an incredible inflection point. You've got a lot of senior people moving out or through attrition or whatever leaving the industry. When they walk out the door, so does all that institutional knowledge and experience. The good news is you've got a lot of fresh perspectives, often diverse perspectives coming into the industry that can look at things radically differently. But I worry a little bit about if it maintains a nice balance or if it swings too far in one way or the other. 

Steve> The opportunity has never been greater for young people to make an impact in our business. The title of “data scientist” wasn't even a thing three years ago, and now it's one of the hottest positions that people are hiring for. That's a huge shift from just, ‘I gotta get a job at an ad agency'. But the specialisation piece of it, I think is a little concerning, because you used to get your first job at an agency so you can learn a lot about a lot of things and then figure out what area you want to focus in. I don't care how they get involved, I just want to find on-ramps and opportunities for promising young people to get connected to a career path. There are recent statistics that say about a third of the people who have left the advertising industry in the last five years have completely gotten out of the industry and just gone to do something else entirely different. So, I worry a lot about how we're either misusing our young people or not nurturing them in the right way. Agencies are notorious at making young people work long hours and putting them through strenuous tests and everything else. We've got to do better in taking care of our people if we want to make it a true career path, and care about purpose and care about mission, and care about all those things that young people really get connected to. 

So, I worry a lot about the leadership of agencies. But then just as I say that I'll have another conversation with a holding company CEO, who will tell me about all the great things they're doing. But then why are these people leaving in droves? As an industry, we've got to be better at taking care of our people, showing a clear career path, and showing that it's a destination career for young people. That's the same reason I got in the business because I knew it would be a great run. And I had a great run. I loved every minute of it. The least I can do is make opportunities happen for young people who might not otherwise get involved in the business. 

Steve> ‘Deeds not words’. By that, I mean actions that demonstrate AAF's commitment to being a unifying voice, especially when it comes to diversity and inclusion. For example, five of our recent board chairs have been women/multicultural (Helen Lin and Tiffany R Warren to name a few). AAF’s most prominent awards, like the Advertising Hall of Achievement and upcoming Advertising Hall of Fame, have become more inclusive and representative of the entire industry. Last year’s 2023 Advertising Hall of Fame was our most diverse class ever. And now, by launching the AAF Foundation, we have created a way for organisations to contribute more singularly to the AAF's diversity initiatives. I would also point to the association's refreshed logo (launched in 2021), which does a better job of reflecting an inclusive, more contemporary, and more appealing visual cue for younger audiences,

I can’t wait for what lies ahead.