Shops Stand to Lose in Digital Revolution

November 14, 2007 By Brian Morrissey

Agencies have the most to lose in the new digital order, even more than broadcasters, per industry leaders surveyed by Accenture.

NEW YORK Changing consumer habits, driven by the shift from analog to digital media, are revolutionizing the ad industry. But that could spell bad news for agencies, according to a new study by Accenture. According to 70 industry leaders surveyed by Accenture, agencies have the most to lose in the new order, even more than broadcasters. When asked who would fare worst in the transition to digital advertising, 43 percent said agencies, compared to 33 percent who answered broadcasters. Cable operators were third with 10 percent. No respondents chose search companies or digital ad specialists.

The end of advertising as we know it IBM Institute for Business Value study

Imagine an advertising world where… spending on interactive, one-to-one advertising formats surpasses traditional, one-to-many advertising vehicles, and a significant share of ad space is sold through auctions and exchanges. Advertisers know who viewed and acted on an ad, and pay based on real impact rather than estimated “impressions.” Consumers self-select which ads they watch and share preferred ads with peers. User-generated advertising is as prevalent (and appealing) as agency-created spots.Based on IBM global surveys of more than 2,400 consumers and 80 advertising experts, we see four change drivers shifting control within the industry.

It is a common theme in the traditional advertising world, and direct marketing world, and sales promotion world that creatives come in sets of two. Art Director and copywriter. They work as a team, are hired as a team and even move agencies as a team.

This makes sense when the agency’s work is primarily a concept — it would be a tough job if the creative blackbox had only one lone hipster sitting in a dark corner, eyes rolling back in his head, trying to reason out whether it should be “Did somebody say McDonald’s?” or “Hey, sombody say McDonald’s!”

In this traditional world where what is given to a client is often a print ad or a script or mail pack, doubling up the creative team makes perfect sense. The account team scales based on the complexity of the client. The planner is a senior consultant and can work on his or her own. Design is a afterthought handled by “mac operators” that are part of the studio once the big idea has been cracked. Production just happens. The real magic is at the concept and with the account folk tapping their fingers, it is no wonder the creatives insisted on working in pairs.

So is this still relevant when our work is so much more complex?

A great campaign now has multiple channels, contact strategies that have to be delivered and synchronised over time, technical executions with data dependencies that require NASA-level project management and fifteen thousand different client teams that need to give their input.

In this world is it fair to put the weight of the delivery on even a superstar copywriter and art director? Can we expect them to know if a flash movie can branch based on if-then logic? If the layout breaks all of the information architecture rules Jacob Nielsen has so painstakingly taught the industry? Whether when a customer starts a card application, a promotion should be offered based on home address, income or key benefit? Whether an e-mail can come from a the sales team, and which of 15 key messages should be delivered in the opening paragraph? How to organise and edit 30 pages of text to make a good argument?

Mark Kingdon on Organic’s site says:

Great advertising was often created in “pairs” — a copywriter and an art director. In the digital world, the creation process is more complex. Strategists, designers, information architects, media specialists, and technologists must come together to create great experiences.

Organic Threeminds Blog

The next step is to look at how the digital agencies are structuring themselves — does RG/A have creative teams? AKQA? LBi? We know Sapient doesn’t, just as Accenture has never heard of them, so where will advertising move to?