Recently I had a conversation with a former colleague concerning an AdAge article, which spoke on the emerging role of Account Managers. He referred to it as how individuals in the Ad Industry need to become “A Jack Of All Trades, Master of Advertising”. However, the biggest takeaway from this conversation was that in today’s world so much more is expected from agencies than ever before.
Increasingly companies are moving marketing expertise in-house (Sprint being a prime example). Marketing budgets are being decreased, whilst clients want greater ROA. I could talk about how this is a vicious cycle – drop in marketing expenditure leads to drop in sales which leads to drop in budgets which leads to drop in marketing expenditure and so on and so forth. However, I think that there is something more vital that we need to consider, and that is whether or not Ad Agencies are still needed? Are we slowly but surely witnessing what some might call, an inevitable demise? After all, why would I pay somebody to perform a service that I believe I can do myself and at a lower cost!?
Let me pause to clarify; as much as I would like to be all knowing, to be the “Jack Of All Trades, Master of Advertising” I’m not. Where the world will be in 10 years’ time…even in ten days’ time, is anybody’s guess. The fact that you can type in the phrase “the ad agency is dead” into Google and get over 8 million hits is a cause for concern. Do I believe there is a single answer to all of the calamities that the industry has and will face? Definitely not. I don’t have the answers, but I do think that this is a conversation that needs to continue to be had.
We’ve seen that agencies have proven themselves adept at understanding new communications platforms and finding the best, most relevant ways for brands and retailers to engage with their consumers, an example of which can be seen in JWTs work on Shell; breathing fresh air into a somewhat stale category. On a fundamental level, we see that the world is constantly evolving, the industry is changing, and as a result we find that agencies need to be ever questioning and proceed to go above and beyond what is required of them.
We could provide an endless ream of examples and praise a magnitude of agencies that have managed to evolve with the world, but that’s doesn’t fully address how to overcome this problem.
Time and time again we’ve heard that “the traditional agency model is dead”, I don’t want to reiterate this message for the umpteenth time, however what I do want to probe, is whether or not the modern agency has a chance for survival. We can talk about the importance of increasing CTR, maximising lead generation and ensuring that agencies assist in creating a fully integrated consumer experience. Yet, if agencies are to survive, we need to explore and exploit something much more basic. Something that is often taken for granted. Agencies need to fully capitalize on the one thing that their clients don’t have simply because the corporate culture may not allow for it. To quote John Kao “The search for value has led companies to seek efficiency through downsizing, rationalizing and right-sizing – approaches that eventually result in a diminishing level
of return. But what will fuel growth in the future? Growth will come through mastering the skills of creativity – and making creativity actionable.”
Yes, yes and yes! Creativity is key! Actionable creativity even more so, but in the age of Big Data being a creative agency is no longer enough. When one person with a wireless connection can be an agency, a media company, and everything in-between, it ultimately results in advertising organizations having to change their culture, processes, structure and talent policies in order to embrace the change brought about by digital connectivity.
The growth of digital advertising that bypasses agencies’ traditional role in placing content has a major impact on how agencies are viewed. In my humble opinion, overcoming this problem comes down to one thing, which is what agencies have been doing since their inception, but merely change the direction of focus. Put simply, this is understanding people. With a slightly different hook, instead of only having a consumer facing approach, one needs to appreciate that the businesses they deal with are not some sort of mystical, ‘Holier-than-thou’ entities. Surprise surprise, businesses are comprised of people, and just as consumers can be persuaded into thinking a different way, so can businesses.
Humans perceptions can be changed, humans can be surprised, they can be maneuvered into a place whereby a desire for something new can overcome the “importance” of simple numbers on a page . For ad agencies to survive the shift to open systems, they must not think of providing clients simply with innovations but rather, transformations. Agencies must rethink their business models and go from being place-based organizations that sell time, to creating a new operating system that harnesses the creativity all around them. They need to be fearless! They need to stand out! A new, fresh approach to the type of people an Ad Agency looks at needs to be embraced, having an incestuous circle of hiring from agency to agency destroys any and all hope of differentiation, the same service is provided by the same type of person, the only difference is a name.
Ultimately, there is a need to question the status quo. Francesca Gino and Bradley Staats put it perfectly, “Early in life, we realize that there are tangible benefits to be gained from following social and organisational norms and rules. As a result, we make a significant effort to learn and adhere to written and unwritten codes of behavior at work. But here’s the catch; doing so limits what one can bring to the organisation.” Agencies can no longer afford to meet expectations, they need to thrive to exceed them, at the end of the day, the client is the employer, the agency the employee, and as Steve Jobs famously said, “It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.” If this is the perception that can be created… maybe, just maybe, they can keep the grim reaper at bay for some time to come.