Let’s put ourselves out of business
If you believe even a fraction of what the pundits are telling us about the demise of mass media and traditional advertising, you can assume a lot of us are out of business in another few years.
Granted, we’ve heard these arguments, many of them flawed, in one form or another for years. Michael Crichton wrote Mediasaurus in 1993 and you probably remember Sergio Zyman’s book as well. And yes their hypotheses were different than those we hear today, but somehow the current pronouncements sound a little more convincing.
So what should we do? Hang on for dear life? Resist as long as possible? Attempt to evolve by preserving what we can and getting ready for what’s next?
How about something more radical? Instead of waiting for someone else to put us out of business we do it ourselves. We–magazines, publishers, ad agencies–create our own version of a hedge fund. We invest in a business model that we think is the one that’s most threatening. If our old model survives, we’ll have a new forward facing division; if the old model implodes, we’ll have a head start on our competitors.
Even though my agency is hanging in there right now, maybe this is what I should be working on: a new kind of agency, one with no overhead, few employees, lots of alliances, a partnership with the best crowdsourcing platform I can find, and an expertise in helping my clients do more of it themselves for less. After all, the media, or what’s left of it, is telling them that they can. But if that’s so, someone will have to teach them how. Why leave it up to some innovative, upstart competitor who wants to put me out of business. I can do it myself. What to you think? Should we put ourselves out of business in order to stay in business?
Comments
If you are really tired then it's good to hibernate. Come back with a new look (reinvention), some cost-benefit analysis: if you think your business can operate using outsourcing, why not try?
Sounds like a nice idea, if it's voluntary. Me -- and more than a few of my colleagues -- are in this position only because the phone's not ringing like it used to. What happens when the alliances dry up in a well of their own problems?
"I dropped out of show business once. But nobody noticed."
Rodney Dangerfield
last paragraph says it all, imho. we are "dis-integrating," and the type of federated model you describe will absolutely be the rule, not the exception, in the future. On the other hand, the challenge of becoming "the biggest agency in..." some segment or region will become that much easier. ;-)
.-= timDempseyu00c2u00b4s last blog ..4 Anchor Tenets for Media and Marketing Today =-.
For the life of me I don't get the crowdsourcing thing. If your agency is screwing up, or doesn't get the new marketing, why would you turn to the audience otherwise known as amateurs?
As a consumer I don't want to be creating advertising for a company. I might post a comment that I like a brand or product, but that doesn't mean I am a planner, strategist, writer, or creative director.
Seems like this is coming from the Unilever client's frustration with his agency, or because he's afraid to properly choose or guide an agency.
.-= Steve Waxu00c2u00b4s last blog ..True Blood: Revelation =-.
Unilever is moving its Peperami snack brand business from Lowe to the crowd. The Ad Age article is as interesting for the comment battle as it is for the original post. http://bit.ly/SDoou
.-= Mark Harmelu00c2u00b4s last blog ..iu00e2u0080u0099m feeling more glamourous already =-.
Money quotes from Matt Burgess, managing director of the Unilever division that owns Peperami;
"Lowe has done great work on the account over the years... But their great work has created a problem for them, because it makes Peperami the obvious candidate for crowdsourcing."
"We left Lowe on good terms... Their business model is set up to expose a brief to two or four creatives -- that doesn't give us the value we get from going it alone."
"We're not looking for ideas scribbled on the back of a Post-it note. We want to come out with an ad that has the same production quality as our usual output. The Doritos Super Bowl ad was a great stunt, but this is not a stunt. We want to do this sustainably."
In three successive statements a marketing guy from Unilever has put an arrow through the notions of the agency as place to build relationships, as entity that can 'curate' brand ideas, and as a group of people who can produce communications to a professional level.
Based on my client experience, I think this guy is wildly over-estimating his own abilities. After all, he's essentially saying that someone like Edward Boches or Rob Schwartz is unnecessary to the communications needs of a brand belonging to one of the world's largest marketers.
If the collective agencies of London had any cojonu00c3u00a9s, they would refuse to take a project from this guy. Meanwhile, I'm going back to my basement to make some more deodorant.
Anthony,
Flattered you think I might be that essential. But a few reactions. One, I do think there is a flaw in a system the briefs two creative teams and neglects the crowd (though they may best be used to augment and spread an idea rather than create it). Two, I doubt that any agency has big enough cojones to turn Unilver away these days unless they are totally independent and rolling in dough. And three I doubt that Matt Burgess will pull it off without some real help. From what I've seen CMOs who can choreograph, curate, execute and produce don't yet exist. Deciding to crowdsource is easy. Doing it right, finding the ideal crowd, motivating them, filtering them, identifying kernels that have potential, evaluating the work and making a decision that will work in the marketplace takes experience, instinct, confidence, judgment. Hey, sounds like a creative director!
Steve Jobs is the only client I have worked for who has the ability to discern the best creative, how it will impact consumers at various touchpoints and also understand how it integrates with the experience of using Apple's products.
I'm sure he and Lee Clow have some very interesting discussions on this subject. Ultimately, he leaves the execution of any idea to TBWA/Chiat Day. He also does not suggest concepts in the initial phase of any project, although he can tell you very specifically what's wrong or right about any concept presented.
It's hard to imagine Jobs would ever be happy with the results he got from a crowdsourcing model.
The trouble is developing more clients like this is like saying "What we need is another Tiger Woods!"
This is why the new skill set will be: how to source, how to steer, how to curate, how to choreograph. If Steve can't do it, good luck to the typical CMO.
Great idea. You should market it to everyone.
.-= Marc Rappu00c2u00b4s last blog ..Crowdsourcing is Schmoofty Part 1 =-.
Well an any agency that just does print is already half in the grave. Agencies that only do digital, and not really good sm or reputation management or great brand planning are only part of the solution. Fact is everyone is trying to get into each other's business embrace convergence. But that just adds to overhead and waters down core competencies (as you suggest.) What we need are brand choreographers, curators, campaign managers who can orchestrate all that a brand needs to be successful. I submit there's no model that does it efficiently and no CMO who possesses the skills.
The problem is everyone claims to be able to handle more than their specialty. Agencies are for planning, spending and ideas, traditional print and maybe media buys. Digital needs to focus on pure digital. Technology and the design that drives that drives the technology. The problem is that agencies are not equipped to handle digital brand platforms because of the complexities involved and the resources needed to support the applications.
Digital shops would not even imagine taking on print work and we would not want to "just because" it would consolidate the resources working on the account. Integration means specialists all working togeather not blurring the lines.
Way too many agencies and shops take on work not in thier tool box.
Like iPhone apps, we should all focus on what we do best.
I'll take the contrarian perspective that we need evolution, not revolution.
The industry has allowed itself to be positioned as vendors of advertising rather than strategic marketing partners. There are a myriad of reasons for this (i.e. the rise of management consultants, the holding company model, etc.) but we're no longer getting credit for doing what we do best: solving problems.
In the future there will be no more above the line or below the line agencies. we'll all be "through the line" agencies. We will embrace all channels of engagement.
But the best work that we produce usually possesses a key, often overlooked element: it speaks to a fundamental truth that resonates with the audience and connects them to the brand. And I'm not convinced that anyone identifies those truths better than agencies. Finding that connection point, where the brand provides a valuable solution to a consumer, is where we'll thrive, today, and in the uncertain future.
It'll just take a while for agencies to stop selling, and clients to stop buying, the traditional solutions.
.-= mitch blumu00c2u00b4s last blog ..Media Fragmentation & Consumer Empowerment Might Be the Least of Your Brandsu00e2u0080u0099 Worries in 2010 =-.
You may be right. But does a client need an entire agency to solve a problem as you suggest. Or just a part of the agency that comes up with the solution and then access to those who'll execute it, regardless of where they are, and even if they happen to be their own employees or customers.
Yes, I agree with you on that point. Staffing (and compensation) models will definitely have to change to reflect the new realities. But even with crowdsouricng, someone needs to aggregate and evaluate the work so that the brand is still telling a consistent and powerful story.
Clients deserve experts working on their business, so agencies should be more willing to bring in subject-matter partners when working in areas that go beyond their core skill sets.
.-= mitch blumu00c2u00b4s last blog ..Media Fragmentation & Consumer Empowerment Might Be the Least of Your Brandsu00e2u0080u0099 Worries in 2010 =-.
I've been reading the comments (another outstanding discussion, Edward!) and thinking about not only what's driving these changes, but the realities of the marketplace apart from the changes. One could argue that the economic downturn caused people to turn to crowdsourcing and to start talking about changes to the advertising/marketing model, but crowdsourcing was there before the economic downturn (Threadless, Innocentive, iStockphoto) and people have been talking about the need to change the way agencies do business for some time now.
It's very likely that businesses (the clients) will not return to business as usual once the economy starts picking up. I'm seeing evidence for this not just in the agency world, but also in law, medicine, and many other industries. We're witness to an economic shift that's impacting broadly and deeply, many different markets.
How does this relate to the discussion here? Nearly all Professional organizations (agencies, law firms, consulting firms, etc.) have a simple and common formula for making money. Each person bills a pre-set hourly rate. The success of each organization depends on leverage - how to get the people with the highest billing rates but lowest compensation to bill the most. Alex Bogusky is no doubt one of the most creative minds of his generation - but if he were working by himself, he could only bill what he could do. That's why there's an agency built around him (of course, you need more people to handle bigger and more challenging work). The same holds true for Mullen. And for the several law firms where I practiced law for 13 years before co-founding crowdSPRING.
Here's the dilemma. Clients are shrinking their budgets and becoming far more demanding. Every organization will need to figure out how to work with smaller budgets and how to leverage those budgets not only to provide exceptional service to the clients, but also to generate profits. In part, that's why iStockphoto grew so quickly - people realized that if they spent $100 on stock and not $10,000, they could use the $9,900 remaining budget for something else - often, consulting/strategy/implementation fees.
If I were practicing law today, I'd be asking a simple question of my firm: how can we work with our clients' smaller budgets but still continue to grow our business?
The answer doesn't lie in charging more. Clients won't pay more. The answer doesn't lie in hiring more people. You won't keep them busy. The answer doesn't lie in slightly adjusting the organizational structure - you'll be "moving the dirt around" rather than sweeping it up.
Part of the answer is figuring out how to reduce costs for certain things that are traditionally neither profit centers nor core specialties, while shifting a greater portion of the budget to agency profit centers and focusing on those things where the agencies excel. That's one reason why so many brands (and agencies) are experimenting with crowdsourcing creative on crowdSPRING - they're, whether they're consciously doing it or not - figuring out what pieces of the creative pie can be less costly so that they could better apply their budgets to those pieces that are more difficult (strategy/execution).
It's not so much an either/or. Those agencies that continue following the old model may do OK for a while - but their growth will be marginalized and compromised. That's because hourly billing is naturally limited unless you can add more timekeepers or increase rates.
The challenge is to figure out how to get more without increasing rates or adding more timekeepers. And that's why I think smart agencies will effectively put themselves out of business to stay in business. Not completely - but by radically transforming how they measure profits centers within the agency and by changing the ways in which they allocate client budgets. Most should start by asking two simple questions about each "profit center":
1) What does it cost me to maintain this?
2) How much profit do I make from this?
I bet many would be surprised to learn that the areas of their business they think are profitable (such as design), are not.
.-= Ross Kimbarovskyu00c2u00b4s last blog ..Twitter Link Roundup #11 - Design, Small Business, Social Media And More =-.
Ross:
May I turn this into a blog post? With some editing and tweaking? May want to do something with it. It's a well crafted POV. Thanks. In fact I already sent it off to my partners.
I am in the process of meeting with people, discussing alliances, and considering a new Mullen offering that is a little different from what we currently do and that will ideally offer our clients additional services. In the process, hoping to experiment with different models and discover something that might work.
Obviously, we are already doing a lot of these things. Huge social media and social influence offering now. Digital partnerships and alliances. And, not quickly enough, an approach to crowdsourcing. Though so far it's not to replace our ideas but to inspire participation. I see no other choice but to change and change quickly.
Edward - yes, please feel free to do that. It's a thought worth exploring further because it impacts every entity that's built around the formula: person X hours X billing rate. And I bet many would be surprised that most professional service entities (my prior law firms included) don't know the answers to those two questions for most if not all of their offerings.
.-= Ross Kimbarovskyu00c2u00b4s last blog ..Twitter Link Roundup #11 - Design, Small Business, Social Media And More =-.
Interesting insights in here.
They seem to lead to specialization: focus on your core business (as defined by the formula, above) and do that to the best of your ability, a la the Collins' hedgehog principle [http://www.jimcollins.com/media_topics/hedgehog-co...]. Those things that are not core (or don't support the core) must be cut, it seems.
But, design is tough to define today. By design do we mean logos and layouts? Or products? (Something else?) Certainly there are companies who do either of those three things and earn profits.
Alas, logos and layouts are not products. Radio spots are not products. Nor are products (digital or otherwise) either of those two things.
Today, does "we are a full-service agency" (meaning: identity, print, radio, tv, web sites, digital products, apps, etc) also mean "we are drowning in overhead trying to sell designs -- loosely defined -- that clients won't buy"?
Not sure any of this, other than a sliver, is about design, Brad. Ross's perspective is about design, but most of the conversation is really about what model should an agency embrace if client's need (sometimes a la carte) strategy, community, viral, self-created content such as blogs and video, an engineered presence in social media, better relationships with customers, personalized listening stations that are strategically valuable, a means of stimulating consumer generated content and WOM, and, oh, yeah, the occasional TV spot. And they need them faster, cheaper and perhaps more frequently. Can one agency do that? Is it a new set of alliances? Is it a confederation of smaller nimble shops? Or is it one or two amazingly diverse and connected individuals who master a means of putting all (and only) the right resources together on an as needed basis.
I didn't mean to position design at the core of the comment, though I do think that trying to sell design broadly is one reason so many agencies are in trouble. Specialization was meant to be the core. That it is most important to know what you are best at, and do and sell that. Leave the other complementary services for other specialists that you bring in as needed (or your client brings in).
Design. What is it? In some circles, it means innovation. Isn't that what we're trying to do--innovate in the face of new market conditions? But what, then, is innovation? Why, it's design, of course. [ A great read from Michael Beirut, from Design Observer: http://observatory.designobserver.com/entry.html?e... ]
I like your notion of the master (person or agency) who sits on top, who is accountable, and who orchestrates, coordinates and/or designs the hydra underneath.
Radical as it may sound I agree 100% agencies have the money and recources to make a change based on the shift that is taking place. Clients are bound to become like most people out there and want their voice to originate from within and by using a Voltron model of several specialty agencies is the way of the future. Leaving all their eggs in one basket just doesn't make sense anymore. The creative in now interpreted in new and innovative ways and each one of those ways require a specialist who can not only execute but remain competitive in that particular specialty. Right now clients are being over billed and agencies are involving way too many layers all dipping their hands into a very shallow pot.
If we all collectively share the workload and each discipline is client facing we will surely see much more innovative work. The agency hedge fund model sounds great.
It's become hard for clients to know where anything originates these days and clients rarerly get to decide what to spend or where to spend it. Agencies need to adjust to facts or implode is the eminent future. Were a more nimble society and our future depends on being able to express our most valued commodity in the most creative and innovative ways, that requires sharing the load across the campaign and letting those who possess the strengths in specialty areas to do that heavy lifting. Just like the mighty software monoliths now compete with the App developer so too will the mighty agency compete with the smaller teams who are able to expedite an idea in unique ways. The landscape has shifted and within a few years (or a few more tweets) the veil will be lifted.
Clients still need management and decision making help and agencies can still survive by providing that but when it comes to actually taking on the work and being paid fairly for it, it's the smaller more nimble teams that should be getting the nod. Loyalty will be based on performance and performance will be based on being paid fairly and allowing the smaller teams to execute outside of the vacuum that we create in now. The Wizard can live in peace with Dorothy and the gang. Just step out from the curtain and talk face to face and we will all make this work.
Right now we have three issues. Even the best agencies don't have all the resources or can't deliver them efficiently enough. Different agencies working for the same client often get territorial and struggle with working together. CMOs are overwhelmed and frankly don't have the skill, internal clout or confidence to properly curate or choreograph the many resources necessary to blend the ideal solution. So, now that we know the problem, let's fix it.
I agree with you on everyone of those points, however if brands are going to survive the cultural media shift they are going to have to address everyone of those areas. Small shops likes ours would rather focus on one or two brands where we dedicate our resources and abilities to take them through the digital transition than work on 15-20 projects that are stop gaps for agencies to just keep delaying the inevitable. There is no doubt that CMOs are starting to wise up however we need more transparency in order for them to have the ability to make the right decisions and their agencies owe then that as part of the service they provide.
It's also worth asking a very basic question about pleasure and fulfillment before we chase all these changes. Will we still like the work? In our race to stay on top of changing field, we can sometimes miss the fact that the career has evolved in ways that eliminate the most satisfying and enjoyable elements. Do we really want to make a living crowdsourcing memes? Maybe we do. Alternatively, we can pursue a new field altogether, one that still enables us to practice the skills we most enjoy.
Scott:
Certainly there are two ways to look at being creative: actually making/writing/designing something; or finding an interesting way to solve a problem. If we limit ourselves to the former and only find pleasure there, then we have to discover an outlet and a market for our endeavors if we want to get paid. (As a writer, I need to write something somewhere and I do like getting paid for it.) But if we also consider the latter, then our minds can be charged with all the possibilities that brings. (Personally, I find equal challenge and joy from thinking in that space, too.) I am not so interested in crowdsourcing or even memes as the pre-determined model, but rather in finding an efficient, relevant way to help marketers connect with, inspire, and stimulate behavior from consumers in an age when an execution, no matter how brilliant, may no longer be enough. As John Winsor, author, writer, thinker, currently at CP&B recently said to me. "Man, this is a great time to be alive." Balance that with Michael Ferdman of Firstborn (a company whose work I greatly admire) who closes his comment with "We are excited and scared at the same time," and you have a good description of my sentiments. I am not a fan of any one technology or platform per se. I am a fan of possibilities.
I agree, for what you described above is a pretty good description of my job, as a director of strategy. And it is indeed an exciting time to be alive for most strategists/planners. The number of unanswered questions combined with new tools and access to enormous amounts of consumer data has led to an explosion of possibilities in my field. I'm not seeing the same growth potential for most traditionally trained creatives. My provocative question to you or any ECD--related to your conversation about biz models below--is how much of your creative staff got into the business because they wanted to efficiently connect marketers with new ways to motivate consumers? My skepticism isn't about the number of new possibilities out there but is methodological. I think you'll agree that all change comes with both upsides and downsides. I personally find it inspiring to keep my eyes open to both.
Such an interesting conversation and one that resonates for our firm (Fborn). Our first 5 or so years we mainly worked directly with brands...the following 5 or so years were filled with all kinds of agency work. The flow of agency work has gotten us thru many hard times but can have obvious issues.
Our goal for 09 was to strike a healthy balance of agency (team detroit and Ogilvy r good examples) and going after daor or just direct work. Whether it is just being ready for it,the recession making cmo's look harder at smaller firms or other factors we have had more opportunities than ever imagined. From strategy to delivering our first 30 second spot it has been quite a ride with many losses along the way which have provided many valuable lessons. We will be named the digital agency for 2 large brands this fall and half our work in 09 as been direct (project based)
However we our constantly having internal discussions about that old line about being careful what you wish for...we r ready to be paid for the things we have always done..thinking, idea generation, strategy, etc but this is a different animal and we have to be very judicious about our choices. So in agreement with S.Wax about being a surgeon and the major surgery needed to make that change. For us the answer is to go slow and not lose sight that being an elite surgeon took a lot of baby steps. This next move of balancing large engagements with project work will take a ton of patience, solid decision making and some luck.
We are excited and scared at the same time
Michael Ferdman
Excited and scared is the best combination of things to be. The latter motivates and the former engenders action. The challenge for a larger agency, of course, is how to scale this stuff enough to pay for its infrastructure. Therein may be the challenge. Though there's an opportunity in learning (both for agencies and clients) to think, solve and operate like a small business. More nimble, more inventive, less hamstrung by the past. We have worked with you guys are you are great. But we probably did not actually partner with you or develop a mutually beneficial alliance for the co-development of ideas and creative. That's something we should talk about.
EB-
Appreciate the back and forth and the kind words
On your point regarding our work together..
National Grid. It ended up being very successful but everyone on both sides had to work very hard to make it happen. Ideally it should have been easier. One reason I continue to work with agencies is I still believe it is one of the very best ways to learn. The truth of the matter is we have a long way to go and true collaboration is crucial. One of our best relationships is w/Team Detroit..having delivered 9 projects in the last 15 months with the latest being Mustang. Has it been easy? Of course not but we have stuck with each other and as we jump on our next project(fiesta) the momentum is strong. I credit many factors but not being treated as a hired gun and knowing we have a future together is huge. To use a sports analogy(which I do often) we r like a player that comes into a game that isn't worried about missing a shot and being sent to the bench. This allows us to work with a different sense of freedom and purpose.
I am a big fan of Peter Drucker and have found myself revisiting his books and have been passing them around the office to our producers. Efficiency is so crucial and as pointed out in this thread one of the areas that needs improvement for further understanding and growth in this industry
Also thought people would like Ted video..I am constantly challenging myself to find ways to motivate..don't agree with all of it but an interesting piece for sure
Michael,
Thanks. We will talk more. I am in the process of working on a new model, offerings for clients, and the alliances that will enable them.
excellent..i/we r all ears and happy to share any of our thoughts about the good, bad and the ugly. plus it might be an excuse to come and see your new digs
Agencies should look beyond just one engagement model(fee based) for existence. Why can't an agency have different revenue models for different clients. For example, for a client with a promising product/service and who is open to ideas but lacking budget, an agency can work for a stake much like Anomaly did with Lauren Luke.
Agencies have the same problem as media houses. We have forgotten the core which is 'creative solutions' and which is independent of the engagement model. Similarly media houses core is 'news' and it does not matter what the vehicle of delivery of the same is. Agencies are not creative enough to explore different options even though we profess to be creative.
I am aware that the holding companies are a major reason for this dilemma with their insistence on quarter-on-quarter growth etc. But that should never prevent agecies from experimenting!
.-= Subbuu00c2u00b4s last blog .."There is no reason not to follow your heart" =-. OH! You're my new favorite blogger fyi
Subbu:
You nail it with the thought that creative solutions should be independent of the engagement model. A creative idea can be *what* to crowdsource. It can be a means of inspiring the propagation of an idea. It can be a way of gathering existing content and creating a new digital resource. And it can be the engagement itself (back to the Chalkbot). A reminder that it doesn't have to be an execution.
What to crowdsource is ultimately the key. The better, the more clearly defined the request, the better and more diverse the results. Things we've done at Tongal have worked incredibly well, things have fallen flat on their face, and it has nothing to do with the price.
Stuart: The upstarts are already working with big brands, but mostly on a project basis.
Campfire's currently marketing Verizon and FiOS, a number of brands for Dr Pepper/Snapple, a major auto manufacturer, Warner Brothers, HBO, etc. Ask Deep Focus or Big Spaceship who their clients are.
And it's not clear it's in our interest to work on an-agency-of-record basis. If you do, you're responsible for everything, banners, radio ads, door hangers, etc. -- whether it makes sense or not.
The digitally based boutiques are more like surgeons than family doctors. And making the new engagement-based marketing work for brands is a complex task, that frequently requires major surgery.
.-= Steve Waxu00c2u00b4s last blog ..True Blood: Revelation =-.
Ad agencies are looking at crowdsourcing artists like the Big 3 Networks once looked at cable television: Hmm, those tiny channels will never work, those little buggers, too immature, and, wait, people are starting to pay for that crap?
Well, yes.
The solution is not to fight the flow of marketing solution demand to the long tail of supply, but to learn how to make money by bringing supply efficiently in line with marketing demand. Ross Kimbarovsky is down the path with one solution [clever bastard ;) ]. But agencies still have roles to play in their ability to marshal talent, expertise, and implementation. CMOs need results with minimal risk; agencies can minimize the risk of investing in a bad brand execution or media implementation, because they are proven specialists.
I'd suggest the solution is to extend the agency role from "product" offer ("hire us, and we'll come up with a killer campaign!") to "marketplace" offer ("hire us, and we'll crowdsource a meme that really moves the marketplace for you."). Find a way to help marketers gather the best input from vast resources, and seed the output among the evangelists who are most likely to take the influence viral.
This probably means we'll all end up working for Ross Kimbarovsky. Clever bastard.
.-= Ben Kunzu00c2u00b4s last blog ..Antimarketing cont'd: FedEx smacks down UPS =-.
There are certain undeniable consumer trends that won't go away. (The subject of an upcoming post if I ever get around to it.) Among them an insistence on participation and a new definition of quality (see recent Wired magazine on MP3s). What the world is waiting for more of are creative solutions that take into consideration these trends (soon to be the new status quo.) I think Steve Wax is onto something with the surgical precision and expertise as a possible model. As is Ross. The question becomes who will emerge as the strategist that best applies them? Who will master the art of choreography that blends them together in harmony? The next model is part aggregator/broker/producer/curator. New skills for sure. But it starts with a fresh approach to the challenge first.
The reason advertising agencies haven't been over run?
No real serious cash has been landed by the up and comers. The large agencies still cater favor with the larger brands and people behind them.
Unless you can convince a major brand to go all in with you on this type of arrangement? You're shit out of luck. Businesses don't have balls unfortunately. The upstarts are going to have to take the cracks that they are given and force themselves in front of the complacent agencies.
Do you have to be crazy to do this? Yes. In fact I'd argue that if you weren't crazy you probably would be unable to even think about challenging and confronting the status quo.
However, light weight agencies, partnership situations are already in place. No one has told them that they can actually go after a large brand though. They are content to sit on the sidelines and not go after a big client. I think this has to do more with a lack of confidence then a lack of ability (that and most brands will have no idea what the heck you are talking about).
Freelancers already dominate most of the design world anyway. In-house solutions are dying as it becomes easier (and cheaper) to outsource work. It doesn't take much imagination to see an advertising agency looking more like a confederation of loosely grouped people rather then a physical entity. It's been happening behind the scenes for a while. Now everyone can see the holes due to the economy and the technology chipping away at barriers to entry.
The people to go lightweight, cheap, and ruthlessly aggressive with talent partnership acquisition? Those people will be able to dominate the marketing agency world. The key is being able to best organize the players. I'm not sure how to do that yet. Dachis, Altimeter and others are starting to do some of the heavy lifting but aren't quite there either.
Let's beat them to the punch.
.-= Stuart Fosteru00c2u00b4s last blog ..Social Mediau00e2u0080u0099s Role in Emergencies =-.
Think about being a CMO these days. You need to integrate brand positioning, strategy, connection and distribution strategy, content creation, community, and search without even getting to the specifics. One could argue that there is an entire new set of tactics needed: mobilizing employees, creating content yourself, aggregating content from relevant sources, crowdsourcing to stimulate participation, releasing control of brand messages to evangelists on Twitter, inventing a way of letting consumers opt in to your messages in customized forms just for them, etc. And, in every case, the solution is different, depending on the company, product, maturity of market, media habits of target audience, and distribution of product (retail, online, etc.) You think a CMO can figure that out? You think an agency can deliver it? You think a choreographer can turn it all into a synchronized effort? Not yet. We need a new model, new roles, new alliances, new tools. A lot of work, but what else we got to do.
I agree with much of this.
The relationship between content and advertising is changing. I see content playing a much bigger role in the future, moving out from the'viral' agencies to older brands and audiences.
.-= John u00c2u00b4s last blog ..Google Social Graph API - the end of privacy on the web? =-.
We've seen a lot of examples of that. Banks in online lending. Music publishers and digital music. Barnes and Noble's delay in becoming an online bookseller. I'm sure there are plenty more.
To argue against myself - Kodak had a digital lead for a while and could have pushed that advantage even at the expense of their film business.
Now they are behind in digital and still seeing dwindling film sales.
.-= Mark Harmelu00c2u00b4s last blog ..iu00e2u0080u0099m feeling more glamourous already =-.
I wonder what would have happen if Getty took on the microstock sites early on instead of buying out iStock. They are now sourcing the crowd at Flickr and setting higher prices and giving the crowdsourced contributors a higher cut. Southwest is also know to compete against any upstart carrier.
It there something a traditional agency can do to embrace the new and protect your turf?
.-= Mark Harmelu00c2u00b4s last blog ..iu00e2u0080u0099m feeling more glamourous already =-.
Getty couldn't meaningfully "take on" the microstock sites. iStock quickly developed an outstanding and loyal community. To compete, Getty would have had to radically change its pricing model (which they ultimately partially did) and accept the thousands of non-professional photographers posting stock photos to iStock. They weren't ready to do that, but quickly realized that they would rather control this movement (buying iStock) than fight it. It was a smart move for them - they ultimately sold in 2008 for, I believe, 2.4 billion to an investor group.
.-= Ross Kimbarovskyu00c2u00b4s last blog ..Twitter Link Roundup #11 - Design, Small Business, Social Media And More =-.
After buying iStock Getty stock price fell from the mid-90's at the end of 2006 down to $25 before going private. Contributing photographer's income fell as well. The figure may have been worse without buying iStock, but it is hard to call it a winner.
.-= Mark Harmelu00c2u00b4s last blog ..iu00e2u0080u0099m feeling more glamourous already =-.
That's a good point, Mark. If I recall correctly, the stock took a dive because of competition from low cost rivals. Then there was that messy event in 2006 when Getty was forced to restate earnings from the beginning until 2006 (I think it had something to do with backdated stock options). In any event - hard to tell what the fall would have been like w/o the acquisition, but a relevant fact nonetheless.
.-= Ross Kimbarovskyu00c2u00b4s last blog ..Twitter Link Roundup #11 - Design, Small Business, Social Media And More =-.
That's kind of what I was trying to get at here, although you said it better.
http://edwardboches.com/change-is-coming-fast-not-...
"It seems your strategy for resisting the threat of crowdsourcing to your agency, is to become an acknowledged expert in crowdsourcing. Smart. And perhaps the best chance at preserving some revenue and differentiation for your agency."
I wonder why crowdsourcing has become a hot topic among marketers? Engagement marketing doesn't mean asking your audience (AKA consumers) to create your advertising. Research, planning, and agency creative apply more than ever to creating the new marketing.
James:
This is all happening faster than anyone imagined. Seems to be taking off right now. I think that those of us who are still standing, whether our legacy was digital, social, viral or pr, will be those who change the model. Global Post or Huffington might be the new form of news (no paper or printing press at all), an opt in version of Twitter may become the new form of advertising we choose to receive, a customized YouTube for "me," from where I invite the brands whose content I want to entertain and inform me could be the new television commercial. Anything is possible,
[...] This post was mentioned on Twitter by Ross Kimbarovsky, Jason Jacobs and :: Kim Sherrell ::::. :: Kim Sherrell :::: said: RT @rosskimbarovsky: Interesting thoughts from @edwardboches: Let's put ourselves out of business – http://bit.ly/JxjtO [...]