Patrick Meyer of NOW Inc wrote a (link) comment to another article today that I think is one pretty accurate take on what agencies (and their clients) are going to have to do to re-strategize their business models and their approach to marketing challenges.
What I take away is pretty simple: the newly empowered consumer is telling us that there's no more room for 'advertising agencies', but there is a lot of room for 'marketing agencies' who benefit from sharing in their clients' financial success via new revenue sharing models. Ad agencies create :30 mini-movies they enter at their private Academy Awards (in Cannes and elsewhere); 'marketing agencies' create new business models and solve their clients' marketing challenges and win their 'awards' for turning around sales declines. Ad agencies pay lip service to "partnership"; 'marketing agencies' dive in and act like their revenue depended upon acting like real marketing partners.
Yes, a radical decline in revenues led to the reduction of agency investment in 'strategic planning' and many clients took that role onboard internally, but what most of the dinosaur agencies didn't figure out is that the changes that have taken place over the past 15 years in the marketing industry have meant that that agencies need to be investing MORE in strategic planning, firing the account people who are clever enough to contribute, and inventing new business models, not new branding campaigns. They must "Stop Being an Agency and Start Being an Agent of Change." (link)
There's going to have to be a shift in marketing efforts in general away from 'brand building' (through endless repetition of branded messages) towards a different starting point: how to build a compelling and engaging initial product experience (sometimes trial, sometimes just exposure) for narrowly targeted 'audiences', on a growing multitude of 'emerging media'. What that points to, for me, is a shift in marketing spending from messages in media, to one-to-one, real brand experiences.
All this is going to mean a step-change from the business models we are all familiar with. To quote Bruce in the comment section to Jeff's article:
"What we do (making ATL campaigns) just stops making economic sense if it doesn't impact vast chunks of the population (shift from watching TV to the Internet and consequent rejection of 'push' marketing). That's the problem we have to solve now. The opportunity to redeem advertising passed a decade ago. Now, the question is, what will replace it?"You know what I think will replace a large portion of the ad spend, Bob: experiential marketing -- real experience with products presented by an engaging brand ambassador, either face-to-face, or facilitated online, or via smartphones, or other emerging media.
Click here for a list of some crucial changes today's ad agencies might effect to come out the other side of this Marketing Ice Age on top.