Coming to advertising near you: The breakdown of the traditional agency model

content velocity

Brad Jakeman, the head of the global beverage group at Pepsico, claims that the media and creative agencies will once again merge. “As content and distribution platforms become more interdependent on each other…the most effective creative will come from the integration of content creation and distribution”.

Jakeman is not alone. Instead of the traditional regime of one to two TV commercials per year, the marketer now needs to have “something new out there” at all times, across different channels, different consumer segments and various buying stages.

These days, people can be reached online at all times with personalized messages, but in a very fragmented media environment. The modern, connected consumer has access to an explosion of touch points with the marketer, and is armed with rising expectations of engaging content and relevant experiences. The hunger for never ending new content supply is insatiable. Research suggests that we all consume an average of 31 hours of content per day. As absurd as it sounds, the explanation is that we are all exposed to multiple channels and devices simultaneously.

The classic process of advertising has tried to keep up with these changes, but is more than cracking under the pressure. After all, there is only so much a traditional advertising agency or media agency can handle alone, and the list of extra partners needed (especially when it comes to marketing technology) has grown. (It is no wonder once absurd sounding statements about CMOs soon spending more on technology than IT, are now generally embraced as true.) The only thing is that as the list of partners grows, so does the general way of working in separate silos, time lost in co-agency processes and overall inefficiencies, not to mention the growing costs of feeding this patchwork monster.

In response, some of the biggest media buyers are demanding more agile ways of working. A few old-school agencies have managed to fumble their way towards more integrated ways of working in the digital domain.

Inside agencies of the big holding companies like WPP, the media and creative teams seldom talk to each other. They still represent different spheres of interest within, held together mainly by financial, not operational controls.

Cannes boast a new love affair with data and technology. However, in reality the relationship between creative old-school ad men and the new breed of growth hackers has been lukewarm at best.

The strong belief in the old, infallible “storymaster-wizards” who can envision and foretell public likes and needs simply by their strong inner vision still prevails. (The Finnish term for this inspiration-based methodology is “mutu-tuntuma”). In the past, with a less-fragmented media, the content universe being small, a segment of thousands was the smallest audience unit. Today, creative designers are finally running out of arguments against programmatic advertising or marketing automation. And their effect on content creation is now utterly transforming their trade.

As creative agencies stall, marketing technology providers and media agencies have started to beef up their creative offerings to satisfy unmet demand. However, it is still not clear how well equipped they are to start nurturing creative talent. Their operational legacy tends to favour processes, predictability, A/B -testing and cloning the same forms (read= content).

Creative ideas are seldom consistent results of a well-managed process. Producing innovative experiences needs a supportive environment of a kind other than a software firm.

Nevertheless, the global consulting behemoth Accenture recently opened a 10,000-square-foot creative content studio in New York. The world of marketing communications as we have known it in agency land is in for a major overhaul.

The winner of the game will be the player who understands not only the technological transformation of marketing, but also creative design, data analytics and distribution channel design. This requires a radical new way of thinking on how to build a transformative, solid, cross-competence team. Only this can create fertile results when faced with the demands of the modern consumer. The alternative is to stick to the old mosaic of the agency maze and waste time and money while the competition moves ahead. Can you afford it?