Fast Company foresees disaster; Bloomberg Businessweek predicts prosperity

Fast Company vs Bloomberg Businessweek: two perspectives on the state of advertising

When it comes to self-criticism, advertising tends to be an industry that loves exaggeration, speculation and especially self-flagellation. We beat ourselves up – or tolerate being berated by others — on a pretty regular basis.  Among the many predictions we’ve endured in recent years: The end of advertising as we know it; Agencies just don’t get it; The Chaos Scenario; and most recently Fast Company’s  Mayhem on Madison Avenue.

The latter, which hit the newsstands last week (though appeared in digital form 10 days earlier) basically suggested that all those dinosaurs who’ve been bringing you the :30 TV spot stand somewhere between too slow to evolve and the edge of extinction. (Note that Mullen was included among those who’ve transformed themselves enough to count as evolved.)

This week, however, we have a very different story. Playing the contrarian, Bloomberg Businessweek suggests that the “lumbering advertising behemoths have advantages over smaller, cutting-edge firms.”

Writer Felix Gillette, after his obligatory references to MadMen, multiple-martini lunches and expense account dinners at Nobu (can’t have an ad agency article without recallying all of that cliche’d imagery for the thousandth time) eventually gets around to disputing the claim that the big, dumb agencies are dead. Instead he insists that the big, dumb agencies are actually kicking the butts of all the little digital shops with funny names.  (That would be Big Spaceship, Blue Barracuda, glueisobar, et. al.)

The poster boy for the article is BBDO NA’s chairman and CCO David Lubars. Throughout a long career, Lubars has produced great advertising work: from his early days in Providence when we ran the Keds business, to an LA stint on Apple, to his time at Fallon where he launched the seminal BMW Films.

So maybe he’s not only entitled but correct when he claims in the Bloomberg story that the little hot shops, who are thumping their chests and declaring the end of mass marketing and the death of the Big Dumb Agencies, do so as a business posture, an attitude for journalists, and a sales pitch to clients. “They don’t believe a word of it,” he says.

Lubars goes on to talk about all the digital work being done at BBDO while the agency still manages to win best Superbowl spot.

One thing both Fast Company and Bloomberg do agree on is that we are in the midst of turbulent times.  Digital shops strive to develop better creative ideas. Giant ad agencies throw money at technical talent in order to compete with the funny-named agencies. And no less than Google, Apple and  Facebook, along with a slew of  hybrids — from the likes of PSFK to multiple new retail platforms –  all have  their own opinions of where the industry is going.

So who’s right? Fast Company? Or Bloomberg? Will the big agencies adapt fast enough and prevail? Or will the smaller, more nimble digital shops with UX and engagement in their DNA win out in the long run.

Hard to say. One thing is certain, however. Given the fact that no other industry in the world seems to inspire more discussion, debate and analysis as the advertising industry, we can be certain the conversation isn’t over.  Like the Energizer bunny, it keeps going and going.

The Beancast with Bob Knorpp, Sheila Dougherty, Ty Montague and Joseph Jaffe

If you’ve never listened to the Beancast, you should check it out some time. Bob Knorpp takes the time and makes the effort to put on one of the best marketing podcasts out there. He attracts smart guests, does his research, and keeps the conversation going on his weekly show, usually posted late Sunday night or early Monday.

This week I had the pleasure of joining Bob, Ad Age’s Sheila Dougherty, Co:’s Ty Montague and Powered’s Joe Jaffe to talk about everything from Black Friday to Miller/Coor’s entry into the craft beer category, the imminent demise of Blockbuster, and the value of Hulu to advertisers.

At least that was the formal agenda. But in the midst of the conversation we covered new retail technologies, the importance of story telling, how shopping experiences are as influential as sales and discounts, word-of-mouth marketing, and the importance of foresight.

Yes, a 60-minute podcast is long in an age of Twitter, sound bites and brevity, but Joe’s actually funny in a couple of places, Ty’s eminently thoughtful, and Sheila is on top of everything going on. Have a listen. You can download or subscribe.

New agency models and what we can learn from them

If you could ask John Winsor, Ty Montague or Ian Schafer any question at all, what would it be?  Please leave your questions in the comments below.  Thanks.

Next week I get to moderate a panel that includes Ian Schafer, CEO and founder of Deep Focus; John Winsor, CEO and founder of Victors&Spoils; and Ty Montague, co-CEO and founder of Co.  Each of these “agencies” offers an alternative, if not an antidote, to the traditional advertising agency.

Deep Focus is a digital agency that calls itself an engagement agency. Its manifesto challenges the relevance of traditional agencies, arguing against a single-minded focus on awareness and in favor of real-time interaction. Ian claims his company — the first US acquisition by Engine — represents the ideal agency for the future. It emphasizes platforms over campaigns, believes in the permanence of social media, and strives to connect with consumers at every touch point.

Victors&Spoils, which recently prevailed against traditional shops to win creative duties for Harley Davidson, on top of a number of assignments for other impressive clients, takes its inspiration from the overused and oft misunderstood label “crowdsourcing.”  Cliché’d criticism of crowdsourcing not withstanding, V&S carefully gathers communities of creators then sources the crowd for a wide range of creative solutions. It manages to offer ideas and solutions to clients for less than what traditional agencies charge while apparently satisfying its creative community with the extrinsic rewards of interesting assignments and a chance to exercise one’s creative muscles.

And finally, Co: introduces yet a third approach. Founded by refugees from JWT North America, BBH and IBM, the advertising collaborative begins with the assumption that one agency simply can’t provide best of breed capabilities necessary for the networked world. CMOs remain ill equipped to gather and unite best of breed resources. And holding companies let financial motives get in the way of crafting the perfect solution.  Co: aims to steal a chapter from the Hollywood studio model, assemble the perfect team from loosely affiliated agencies, deliver the right blend of services for any given project, then disperse when that project comes to an end, promising clients better talent and greater efficiency.

Two things make each of these models possible: digital technology that fosters a new kind of collaboration; and the fact that they all started from scratch, free of the constraints, muscle memory or DNA of an existing advertising agency.

True it remains to be seen which if any of these alternatives will emerge as a real threat to legacy ad agencies. (In fact, a number of great full-service agencies are  successfully adapting.)  But based on enthusiasm, press coverage and early success, all three are on to something. Seems to me that whether you’re a traditional ad agency, a digital or interactive shop, or a CMO trying to figure it all out there’s something to be learned from what Ian, John and Ty are up to.

Questions for Victors&Spoils, Deep Focus and Co:

• Did you create your agency believing that the old model is broken?
• Can a traditional agency replicate what you’re doing?
• Is it possible to transform a company from one specializing in awareness and paid media to one that understands real time interaction, earned media, and the new networked environment?
• What would its greatest challenges be?
  
• Are engagement and UX the new art and copy?
  
• Does crowdsourcing have a place inside the traditional advertising or interactive agency?
• What makes the alliance model of Co: better than the integrated agency where people actually have experience working with each other?
• What kind of reactions are you getting from clients and prospects?
• If you were still back inside an ad agency, what would you implore management to do differently?
• In each of your cases, you personally re-invented your own careers, learning new skills in the process. Any advice for those in the room on how to do the same?
  

Those are but a few of my questions for the panel.  What are yours?

An encyclopedia founder is coming to our school! Woot!

If you need evidence that the world has changed a lot since you were in high school, look no further than this quote from Jimmy Wales, the founder of Wikipedia.

“When I go to speak at a university or high school, it’s completely insane how excited the kids are about Wikipedia,” Wales said. “I remember when I was in school, if they told us that the editor-in-chief of Encyclopedia Britannica was coming, we would’ve probably just killed ourselves.”

This must be the dream reaction for any product. Not only has Wikipedia made the only other brand name encyclopedia irrelevant, forced its digital competition into early retirement and made itself the de facto case study proving that crowdsourcing works, it’s endeared itself to high school students.

The latter obviously relates not merely to an encyclopedia and its content, but to all that Wikipedia represents: entrepreneurialism, purpose, and most of all an open invitation to participate.

There continue to be marketers, critics and brands that don’t really get what it means to have two billion new participants in a media landscape previously controlled by a few. Columnists write about how we embrace technology they claim we don’t need. Marketing strategists continue to imply that brands are being falsely lured into social media.

But Wikipedia, along with other community creations such as Firefox, reminds us that people rejoice in being heard and having the opportunity to contribute.

My wife once had a letter published in the New Yorker magazine. This was eight or nine years ago when expression was only free if you owned the publication. Her letter, one of for or five published that week, merited emails and phone calls of congratulations from everyone she’d ever known. Seems insane in today’s world.

I’m not surprised that Wikipedia gets such an enthusiastic welcome. Nor am I surprised that Britannica would have been greeted with yawns if not worse. One invites you to be part of the experience. To have a say and feel fulfilled by your contribution.  The other simply declares that they already know it all and don’t really need any help from you.

Jimmy Wales implores brands to “make stuff that doesn’t suck.” I would add to that, “do something that makes high school and college students overjoyed to see you on campus.”

Will monkeys pay more for sex if the ads are good?

“Oh my God, you won’t believe what I’m working on.  Are you ready for this?”

A few nights ago I ran into Jim Amadeo, an old friend and ex-colleague. Always effusive and optimistic, Jim was even more excited than usual about his newest freelance gig. He could hardly contain himself as he proceeded to tell me that he was documenting and working on a campaign for Yale University to promote an upcoming study on whether or not advertising works on monkeys.

We can always debate the effectiveness of advertising. Does it get us to pay more for a product? Can it make a brand more desirable? But we’ll soon have new findings to help us determine the effectiveness of advertising.

According to Jim, we’re about to learn whether or not monkeys will pay more for bananas, grapes or even sex if the advertising is any good.

Yale has been at the forefront of studying primates for a long time.  In 1947, a Yale researcher, Dr. John Wolfe, in an attempt to see if chimpanzees could understand symbols, discovered that the primates could quickly learn the value of currency, using it to purchase food, learning different values and even hoarding it for future purchases.

In 2005, a different team of Yale researchers learned that monkeys would pay for monkey porn as well as the real thing. (Interestingly male monkeys will pay for sex while the female monkeys turn around and use their coin to buy sweets.)

And today Associate Professor Laurie Santos, who works with capuchins at the university’s lab, continues the Yale tradition of studying monkeys. Her interest is in whether or not monkey behavior can teach us anything about our own ineptitude, particularly when it comes to financial decisions. Do we humans make all kinds of dumb mistakes – failing to sell tumbling stocks, holding onto bad real estate, not understanding absolute value – because of the complex environments we’ve created or because we’re programmed to do so? Answer in video above, and it’s not good news.

But now we’re told, it’s time to see if monkeys will respond to advertising. Will a prettier picture of grapes get a monkey to pay more for them? Will posing a sexy female monkey with the grapes make them even more valuable?  Will advertising get the capuchins to make decisions that are smarter or dumber?

Those of us in the business have been taught to believe in things like repetition, offers, incentives, calls-to-action, originality and honesty. We’ve figured out that exaggeration might work once but rarely twice. But soon we’ll have irrefutable, genetic evidence from none other than Yale.

My guess is that it will be fun to see the results.But I’m presuming it will be what we already know. Bad ads, even bad monkey ads, won’t work as well as good ads. Discounts and offers will be effective only for things that capuchins already want. And sex will always sell. Even if you’re only trying to move grapes.