I did consider titling this post \u2018The Future of Agencies?\u2019 With a question mark. As in: \u2018Is there one? But on reflection I settled on the above. There is a future, but my old friends and colleagues need to get their skates on.<\/p>\n\n\n\n\n\n\n\n
Last month Sir Martin Sorrell was at DMexco being interviewed by Ralph Simon, the CEO of the mobile consultancy business Mobilium.<\/p>\n\n\n\n
Here\u2019s what SMS had to say about the future of media agencies:<\/p>\n\n\n\n
\u201cMy view is that the media planning and buying organisations that we see in the six agency holding companies probably employ about 200,000 \u2013 250,000 people. They will not all be employed there \u2026. even in two years\u2019 time.\u201d<\/p>\n\n\n\n
Sorrell was the pioneer of media agency mini-holding groups, in his case GroupM, whose original reason for being was volume and volume deals.<\/p>\n\n\n\n
I have an SMS quote from 15 years ago, when he opined that media agencies were entering a new era of \u2018brain, not just brawn\u2019. It\u2019s been a while coming, the lure of high margins was just too great, but better late than never.<\/p>\n\n\n\n
Media agencies grew up as buyers first and foremost. Clients referred to them as media buying agencies \u2013 many still do.<\/p>\n\n\n\n
Planning was an after-thought, the front-of-house people designed to get you in the door. Once safely inside you were escorted to the smoke-filled, windowless room at the back where the deals were done. Truth is, you came for the deals, and everyone knew it.<\/p>\n\n\n\n
Times change, today the opportunity is all about understanding audiences and turning that understanding, those insights into practical actions.<\/p>\n\n\n\n
Buying the right thing beats taking on any old cheap tat.<\/p>\n\n\n\n
Or it should do. There are still some dinosaurs around the industry, talking of share deals, cheap CPM\u2019s, optimising clicks, using words like \u2018views\u2019 and \u2018viewability\u2019, \u2018attention\u2019 and \u2018attribution\u2019 without really knowing what they mean.<\/p>\n\n\n\n
It\u2019s an understandable confusion; if you ask 10 agencies for their definition of (let\u2019s pick one at random) \u2018attention\u2019 you\u2019ll get at least 15 different answers.<\/p>\n\n\n\n
We don\u2019t know what we mean ourselves, so why should our clients?<\/p>\n\n\n\n
What we\u2019re seeing today is the painful (re)birth of the planning era, an era defined by insights and creativity, not audits and CPM\u2019s. The dinosaurs will die out, or at least retire comfortably, still raging against the platforms, and advertiser research initiatives whilst their ex-employers\u2019 revenues drift away.<\/p>\n\n\n\n
Their old allies the buying agencies are of little use. They have been hollowed out. A combination of a lack of trust, the giant platforms going direct to their advertisers, and a lack of real training in creativity as opposed to media technology has done this to them.<\/p>\n\n\n\n
They\u2019re understaffed, their margins aren\u2019t what they were in the golden era before some busybodies and know-it-alls invented transparency and the large groups are in \u2018deal hock\u2019 to the major vendors.<\/p>\n\n\n\n
They have little to say, few opinions about the issues of the day for fear of upsetting some corporate applecart somewhere.<\/p>\n\n\n\n
They\u2019re fast in danger of becoming irrelevant.<\/p>\n\n\n\n
But there is hope.<\/p>\n\n\n\n
Advertisers need help with navigation. There has never been a more complicated media scene and we\u2019ve never had more data to help in the navigation. Data that can be insightful, or highly misleading.<\/p>\n\n\n\n