Traditional agencies are the future of digital

Little by little, traditional agencies are incorporating digital, software and technology into their arsenal of capabilities

I didn’t say that. Winston Binch said it. Winston was one of the forces behind the emergence of Crispin Porter + Bogusky’s digital reputation, leading interactive efforts on clients such as American Express, Domino’s, Burger King and Best Buy. Before that he oversaw creative and technical development on much of Nike + at R/GA.  So presumably he knows what he’s talking about. He recently left CP&B to join Deutsch and his ex VW client.

In the last few years, the advertising industry has seen never ending fragmentation and the emergence of specialized agencies in social media, digital creative, digital strategy, digital media and digital production. Some of those firms and the press that covered them rejoiced at least a little bit in proclaiming that traditional agencies didn’t get it. Their creative departments only knew how to do TV. They didn’t have embedded technology. They were too slow to change.

Now, however, it appears that we might see a reversal of that sentiment. Iain Tait resides at Wieden and Kennedy. Winston goes to Deutsch. Matt Howell joins Arnold. Mauro Cavaletti and Perry Fair come to Mullen.

Traditional agencies may still be developing campaign-like digital experiences, but it’s only a matter of time before they get as good at platforms and eco-systems as well for a few unarguable reasons. One, it’s harder and harder to separate one brand experience from another; they need to work together and agencies will figure out how to take the lead. Clients will tire of having to manage so many resources and the struggle to get them to all work seamlessly together. (Even if they want to they don’t always know how.) And, perhaps most importantly, great digital talent is realizing that they want to be part of the brand team, influencing the “big” idea itself, and so they’re concluding that ad agencies offer up the best opportunities.

If you need further evidence, you can always follow the dollars, not just the talent. Just today Ad Age reported that agencies are getting 28 percent of their revenue from digital, and while the bulk of those dollars are going to the likes of pure play digital shops, multiple billions are being divvied up by DR and traditional agencies.

At the same time, digital agencies are striving to develop so called traditional skills, seeking and hiring brand strategists, storytellers and TV talent. No doubt many will figure out that side of the business, too. (Ad agencies needed to learn social and digital to thrive; now digital agencies need to learn traditional branding and propagation.)

Clearly it’s become harder and harder to draw a line between what we’ve previously labeled advertising and digital.  The best ideas transcend execution, media, and technology and combine all three. They have social media components to them. They happen in real time. And they call for incredibly diverse teams.

It’s all good news. For both sides of the agency equation and for clients as well.  Storytellers will learn technology. Nerds will get more creative. And the outcomes will be more interesting. Will traditional agencies win? Or will all agencies end up tradigital?

 

 

 

 

 

 

19 comments
sermadb
sermadb

Having worked in both pureplay digital and then 'traditional' I can throw my own 2 pence in.

Pure digital agencies do a lot of the work traditional agencies just can't do and actually don't wont to do. Banner ads, search, emails, more banner ads, more emails, client websites, client mobile sites, client shops, intranets etc etc etc

To do all of this work needs a lot of people and that is a lot of hungry mouths to feed - constantly. Just look at size of the engine rooms of agencies like AKQA and RGA.

The traditional agencies I've worked at (Wieden + Kennedy London & TBWA) are not interested in staffing up to this level. There is a drive to have skilled technologists, user experience and designers in house and they handle smaller scale projects but the bulk of the project goes to production partners who have all the required staff. This model has worked pretty well for the ad industry for print and TV and with the right partners it can work for complicated digital work.

You work with the best dedicated partners in the field in the hope that their gold dust will rub off on your idea and hopefully make it even better. I don't believe at all that agencies need to make everything for their clients - they just need enough smart enough people who understand how to think up new things and what goes into making those new things. A great great great digital producer in a traditional agency is a person who can make anything happen.

Handling social media is an interesting problem - I would say this has to be split between the client to handle CRM and an external agency - because of the high velocity of social conversation I really think the agency who creatively directs the tone of voice is best placed here - which I suspect is why a lot of traditional agencies who now employing community managers and setting up dedicated social units.

So I believe there will *always* be a split between a lot of different types agencies - Some clients will just need a digital agency, some clients will split their work between digital and traditional and some clients might just need a social agency.

All I know is that the worst thing a client can do is buy an idea off one agency and then give it to another to execute.

juzmcmuz
juzmcmuz

I hear people constantly lump "digital" in as another form of media. it is NOT "all just media"! And failing to understand the many distinctions, nuances and implications of this fact (hint: it's about doing stuff, participating, services, actions) is proof that traditional agencies/people are not the future of digital.

It's a great provocative post though I did spray my coffee at "great digital talent is realizing that they want to be part of the brand team". No they're not. Great digital marketing people perhaps. But great digital people are just making their own thing. Starting a business. Making a web app. Doing it for themselves not clients. And it's these people that are the true future of digital.

miketrap
miketrap

As "digital media" becomes "media," of course the general agencies will embrace it. Some - like you guys, Crispin and Ogilvy - will actually excel at it.

But a lot of what makes good sense in digital simply can't support the traditional agency economic model. Doing that work niche players and boutiques can also thrive, and the circle of life will continue.

The agency business has been dying since I entered it in 1988, and it's probably more vital and interesting now than it's ever been in my career. Change is, indeed, the only constant.

samsnead
samsnead

Winston is a savvy and smart ad-exec, great hands-on skills and experience building teams. His comment stating 'traditional agencies are the future of digital' is proof of his savvy. He is being provocative. BUT at the end of the day 'traditional vs. digital' doesn't matter one bit. Clients don't go to sleep at night worrying about their traditional agency or their digital agency. They are going to move to where good work happens. The place where innovation occurs and helps them sell their product or service. In this article I don't see any strong argument why traditional agencies are going to be any better at changing with the times than digital shops. The only arguement is that "Traditional agencies are catching up". The proof given is that a bunch of ex-R/GA employees were hired by traditional shops.

The bottom line is that all agencies need to change to survive. Right now to be relevant in the digital space you need to actually 'make things'. Traditional shops don't generally make things. They work with 3rd party production companies, this is the traditional process. Yes, I realize this is changing but they have a long, long way to go. I would argue that all agencies need to think more like Silicon Valley, forget digital vs. traditional. Help your clients build their business. Agencies have done this largely via branding /advertising; spreading messages via print and TV. This is an essential ingredient for brands today but they need this way less than they need business changing ideas. All of the innovation right now that brands lust after is happening in Digital. Agencies should be looking at big innovators like Twitter, Apple, Google and small ones like Instagram, Four Square, FlipBoard. These companies are product companies with technology at the CORE. These companies have engineers at the center of the decision making.

The big test for me is two-fold. When will the industry respect technology talent by having them in senior decision making positions? AND when will the industry awards circuit actually come around to respecting technology talent enough to have them judge work? 95% of the judges are 'creatives'.

I love this business and come from a creative discipline but have found that the most effective people in my company, those who change and improve the clients business are from a technology background. And in many cases the structure in our company and industry are holding them back. Change takes time.

randomculture
randomculture

If the "traditional" agency is the future of digital, it needs to look very different than it does today. Winston said in his interview that the reason he believed the traditional agency was the future was because "there are fewer great idea people than there are great technologists." I think the challenge goes far beyond people. I believe the traditional agency structure isn't equipped for the shift from paid to owned and earned media. Hourly rates are too high, compensation may often still be tied to media spend, creative teams don't include technologists, and a multitude of other issues. While I believe traditional agencies CAN be the future, I'm not sure enough of them will be able to make the changes necessary. Great topic of conversation!

ScottDoniger
ScottDoniger

seems to me that a threshold has been crossed where agency nomenclature should now align with outcomes instead of outputs. the social media wave is instructive here: analysts and agency pundits rightfully point to how social tools and techniques have enabled people to wrestle control of brand image and brand-consumer dialogue -- outcomes. in the context of these outcomes, i'd suggest that using "traditional" and "digital" are sorely limiting agencies to fit into an output-focused box. rather, maybe we consider a re-defining paradigm and establish nomenclature based on a focused set of desired brand/person "outcomes" that better-enable brands to figure out what a shop does well/best -- i.e., conversion; relationship; influence...admittedly inelegant names, so please modify if you agree. i just don't see the viability of categorizing agencies with what seems to be today an antiquated construct as traditional and digital are already in confluence.

benkunz
benkunz

I agree with @soulkat. It's all just media, and the delineation of digital and traditional has been artificial.

Channels ladened with technology always start out as experiments, and evolve into specialties, but eventually become commodities. Social media sentiment analysis, community building, and meme propagation are fancy terms for what advertising has always done: listen and persuade.

soulkat
soulkat

I agree that it is hard to draw a line between traditional and digital. That's because there shouldn't have been a line in the first place. As you mention, consumers are devouring their brand experience through multiple sources, primarily digital. I wonder if there was as strong a debate in the 50's around radio vs television advertising. I relish the day when we can talk about a powerful and successful brand experience and not cram it into individual boxes.

thejordanrules
thejordanrules

I've worked for some of the best creative shops in north america, and the biggest issues regarding digital integration that I've run into are: idea recognition and experience design. Many creative-lead shops have established methodologies for coming up with great ideas, and have senior creative directors who might not have the experience to understand/ recognize good digital ideas. (That said, it often doesn't stop the creative-lead shop at coming up with original ideas that work within the digital space.)

If traditional agencies want to be the future of digital, I think they need to invest in experience design & experience strategy. Learning how to do this, and effectively integrating those UX evangelists throughout the agency will ultimately determine those agencies that move the industry forward.

MarketingAtom
MarketingAtom

Digital is just another tool. It is becoming as traditional as television and print. I believe the "traditional agencies". While it is nice to win a Harley Davidson account as the smaller nimble V&S, many brands bet on the seasoned giants. Is that a good thing or a stifling of innovation? It all depends on the agencies adoption of new strategies using any available technologies, including tv, radio, and print.

The "Television" was at one time the new digital technology and advertising had to adapt.

JamesJMueller
JamesJMueller

Traditional agencies have the financial clout to lure talent away from smaller, more specialized digital boutique agencies once they've proven they know what they're doing. Those traditional agencies also have the reputation and full-service that the smaller boutiques can't provide their clients, and I think there's a big appeal in that. In the end the big agencies prevail, but as always there will be quirky, experimental, innovative shops springing up left and right at least as quickly as they can be absorbed by the bigger players.

edwardboches
edwardboches moderator

@miketrap Yes, agree the small and niche will prosper and survive. Just defending the old (and changing) model that constantly comes under fire. Smart agencies may not be first, but they figure it out.

edwardboches
edwardboches moderator

@samsnead This is the best comment I've gotten. (And from a dead golf pro, no less.) Agree about the building thing. We try to do that and it's hard. An ad agency should have thought up Groupon. A photo company should have conceived Instagram. We make lots of apps (phone and pad) but not the same as actually building long lasting utility-based platforms. Interestingly the tech still needs a propagation plan. (BTW, Silicon Valley, tech and software don't even use the word digital; that's an ad industry word. So I am using it in that context. Even digital agencies don't build what Silicon Valley builds.)

edwardboches
edwardboches moderator

@randomculture Good points,. See what SamSnead above had to say. I think agencies will figure out the challenges you refer to more easily than those that he talks about. But I agree, many won't figure it out, some will. And yes, it is a great topic.

leighh
leighh

@benkunz Differentiations are absolutely necessary however, the ones most people make like digital vs. mass are stupid. Banner ads are mass. If you think in terms of invasive passive and interactive or engaged media the murky waters become strategically much clearer.

edwardboches
edwardboches moderator

@benkunz Yes, but, here we are talking about building things, too. Think stuff like: Garmin Connect; HTML5 mobile sites; IP platforms like Crowdtap;, robust, interactive websites; etc. It's easy to know the media, it's harder to harness and integrate the skills into a process that is interactive, iterative and works/thinks less like messages. I believe that's what we are talking about. Traditional agencies have lots of writers and art directors. Next gen needs UX, developers, engagement artists, et. al.

edwardboches
edwardboches moderator

@soulkat Kat, you are dead on. Not sure where the distinctions and competition came from. Perhaps because initially new, digital-centric shops argued for it, or took advantage of the opportunity. Or because clients saw limited offerings or commitments from their ad agencies. But today, media, creative, stories, tech, software, experiences, etc. are all one and the same.

leighh
leighh

@edwardboches @samsnead if you can put your hand over the app and any vertical industry it addresses can potential have created than app then it's a fail over the long term. I think one has to be careful not to start doing what a lot of bad Digital shops did in the dot com bomb by creating consumer focused [insert big website idea here] platforms that brands could not innovate and sustain over time (instagram is not just an app it's a business).

I personally think 'brand' is the piece that will create the meaningful differentiation over time. Will that sometimes mean creating a branded utility piece? Of course if it makes sense. But it better be branded from in the inside out or it will fail just as so many of those platform ideas did (anyone remember GM's youth community curve.com DOH)