Over the past day or so there was an interesting conversation underneath an article about what advertising agencies will look like in 2015.
The article itself starts by saying "the world of advertising is in flux." True. We can all agree that change is a reality.
The discussion broke out over the subject of analytics. Some people embraced analytics as a valuable tool. On the other hand, one person said "analytics is just another word for bean counter".
In the days of Ye Olde Marketing, my life in large agencies was about strategy and creative. Now it's about strategy, creative and analytics. It's much easier to know which half of my budget is being wasted. (I've written about this here and here.)
Back on analytics, a comment by "Bruce" of Toronto is worth repeating here: "I, too, agree [analytics is important]. The problem will be as it has always been, though: What to measure? Advertising's job usually isn't to sell, as a matter of fact. Usually, advertising's job is to predispose a consumer to buy, with the sale being closed by another more immediate brand experience. Measurement will save this business if it's intelligent, and destroy it if it's nothing more than simplistic scorekeeping."
Bruce, I agree -- that's where the channel-neutral planning comes in. If the only tool we have is traditional advertising, all we can do is predispose a consumer to buy. If we plan the consumer's entire path to purchase, however, we can figure out how to predispose, incite -- and close the sale. The measurement will be clearer, too.
The 19 comments posted as of this writing may not be a scientific sample but they would seem to indicate that analytics is far from ingrained in agency culture today. In the future, it will be.
Steve, like you I'm amused by the comment equating analysts with bean counters. Only a traditional marketer would give an accountant claim to the mantle of chief analyst. In the land of the blind, the one-eyed man is king.
ReplyDeleteSeriously, how does a discussion about the Future of Big Advertising avoid the question: "Who needs an Agency of Record Anyway?" The Digital Age has brought us disintermediation on an unprecedented scale. Why does an agency give away creative OR research in order to gain the right to buy ad placements, a primarily transactional activity?
Consulting firms are paid directly for creative and analysis activities. Why aren't ad agencies? As ruthless competitors entering the ad space offer discounts on ad placement fees, the old model begins to break apart and "creatives" become much more focused on cost control and analysis.
Jim, this is an excellent point. Ad agencies lose sight of the value they create for clients. Some don't create value at all; they just run projects. Either way their punishment is the same: commoditization. I will post about this more in the future.
ReplyDeleteAs for the bean counter comment, I can add this thought: the accountants are the bean counters; the analytics people feed strategy so we can create value.
Thanks so much for continuing to comment, Jim!
There are days, Steve, that make me feel as if the agency model is beyond hope. Recent events at a number of Chicago agencies reinforce those feelings.
ReplyDeleteBut then I remember that this is a resilient business that provides an essential service in the working of free enterprise. Over the past 30 years, many of the iconic agency brands have grown into seemingly permanent fixtures.
However, the business model may not support giant global conglomerate agencies in the coming years.
Didn't we have this conversation in 1991 as well?!
Brands need brand managers who need agencies. Let's start there. How brands are managed such that they gain category captaincy and consumer loyalty is indeed undergoing a shift. I believe this shift will continue to roil the agency business for about 15 to 20 years.
Why? I see the technologies that are driving these successive waves of change in their infancy. We're about 15 years into the Internet marketing era and that's still only two dog years. There's more to come. A lot more.