The Answer: Railroads, Newspapers and Advertising Agencies
The Question: What industries have / will decline because they did not understand what business they were in?
To take a skit from the great Johnny Carson, this could easily come true. Much like railroads never adapted to other forms of travel and newspapers can’t shake their dependency on selling ads only on pulp products, the traditional advertising agency model is evolving. For many years now, the advertising model has been morphing and traditional agencies seem stuck in their old ways. They have left such an opening that new cottage industries are popping up all over to take on what’s being dropped beyond the old model of creative storytelling. These new players are coming under the guise of digital shops, interactive shops, social media marketing shops and even traditional public relations (PR) firms are getting into the mix by creating their own digital practices.
If that’s not enough, now you even have independents and consumers now coming up with extremely creative concepts and execution. For $12 and change you can now create a super bowl commercial, build an entire Brand out of yourself or even take on the entire multi-billion dollar industry to develop creative for a multi-national brand. A little imagination and a video recorder have altered the way consumers think of their involvement with a brand and completely re-structured how the corporate world must react to consumers ever changing interests, power and influence. More importantly (and this is where the agencies are not effective) companies need to do more than just react to this new consumer, they must involve and engage the consumer in ways that are not even imagined yet.
So how do agencies compete with all of the boutique industries popping up and the unique competition from near free crowdsourcing? We’ve spoke here about the need to transition from campaigns to conversations and crowdsourcing is the equivalent of guerilla warfare as no one knows who the creatives are or where the production is coming from. In fact, the media industry has struggled with managing the quality of crowdsourcing for years now and are even further away today from capitalizing on it than they were 4 years ago. Traditional agencies seem well positioned to handle both of those challenges yet many are in denial and still calling crowdsoursing a “fad”. Those are only some of the reasons there are dozens of these new age companies starting up to solve specific areas of untapped needs in the new agency model.
While the agency world is busy chasing it’s tale, Brands are still required to sell more product to new markets. As a result, companies (and here) are gearing up their own resources to meet the challenge. They are creating great products and product experiences then inspiring their consumers to tell their story for them. So that begs the question if Agencies are even relavant anymore? I certainly believe they are but now in their current form. I always go back to an analogy I’ve been using for a couple of years: Just because you can go to the market, buy a chicken and some spices does not mean you can cook like Emeril LaGasse. And the same holds true in this industry.
To bring some relvance to this dialogue, we have recruited on of the best thought leaders of the “New Agency World”. Edward Boches is the Chief Creative officer and leads the Social Media practice at Mullen, a full service modern agency. His insight is not only transforming the way Mullen does business, but also the way much of the industry is beginning to think about their businesses. The topic and questions are as follows:
Topic: The Future of Advertising & the Role of the Agency
Q1: What is the model of the ideal agency?
Q2: What skills and talents are needed?
Q3: How much should brands do in-house vs. outsource to agencies?
In keeping with our end of the year theme, this week’s focus on the future of advertising is sure to broaden your ideas of what advertising is and where it belongs with your company large or small. The format will stay consistent with the first question at noon EST and following questions every 20 minutes. To manage the conversation we will use #sm37 for the event. Be sure to join us this Tuesday December 8 at noon EST as you will not want to miss an opportunity to interact with one of the industry’s most progressive minds.