What is the point of advertising agencies?

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We’re at the start of a potentially glorious new era for the ‘advertising’ agency. But opportunity and execution are seldom bedfellows – agencies need to clarify their core value proposition or risk irrelevance.

Bewitched by the new orthodoxy of ‘conversation marketing’, dazzled by the promise of ‘big data’, drawn to the promised land of owned IPs, driven to distraction by gamification, ‘social engagement’, apps, purpose ideals and a myriad other nebulous communication and branding trends, agencies are rapidly morphing into new kinds of companies, the forms and structures of which bear less and less resemblance to the common conception.

Not to evolve is not an option. Companies employ advertising agencies to help them raise their profile and sell their products. Agencies realise there are now more ways to do this than ever before and are retooling accordingly.

But in the rush to assure befuddled clients that they are equipped to help them navigate a confusing new world, agencies have grown modish. Their traditional core competence – persuasion through creativity – is ceding its place to a rash of supposedly indispensable new skills: community management, UX, app development etc. Left unchecked, this determination to be all things to all people could have the opposite effect. Clients will demand of their agencies: ‘What is it exactly you do for us?’

What’s more, even with their new infatuations, and even though disruption is often held up as some kind of levelling force that sorts the most fitted from the most fattest, agencies continue to be massively inefficient. And even more embarrassingly, the vast majority of agency output continues to be utterly bland and dismally ineffective. Agencies are losing their way just when they should be plotting a clear path to lasting relevance. And in a world where the notion of an intermediary between a brand and consumers already risks appearing anachronistic, that could prove fatal.

Three areas of chronic inefficiency

Inability to inspire – losing sight of exactly what it is they exist to do has corresponded with the decline in agencies’ ability to enthuse clients and encourage the risk-taking that leads to groundbreaking work. Too rapidly client/agency relationships descend into, at best, cosy dependencies and, at worst, weirdly dysfunctional, distrustful arrangements of convenience. The process of actually producing work is like trying to fix a puncture in the rain: it’s something that has to be done, but it quickly descends into an uncomfortable and often farcical process, and when you’re finished you have no idea if it will work.

Narrow frame of reference – a while ago I read about the mollycoddled lives of San Francisco Googlers. Each morning, they’re picked up by an air-conditioned, WiFi-equipped coach (albeit one driven by a human) and transported to their futuristic office complex where they’re massaged, fattened, and generally spoiled. The writer’s point – that such an existence curtails entrepreneurial spirit and innovative thought – is just as applicable to advertising. Inspiration is YouTubed, we cannibalise the work of our peers. Worse, we NEVER LEAVE THE AGENCY. Why would you go and observe consumer habits when there’s free coffee on tap?

Unclear purpose – the main problem. In the past, consultancies existed to optimise business process and performance and agencies existed to create brand preference and improve sales. Now, much of what an agency does (or wants to do) encroaches on the territory of consultancies, PR companies, and any number of specialist providers (product design, social, digital etc). As our focus widens, the quality of what we were once known for – communication that persuades, shapes perception, and positively brands – is deteriorating. For every Old Spice, there are a thousand stinkers. What other industry tolerates such a pathetic hit rate?

Is there hope?

Although the above sounds apocalyptic, I’m positive. At their best, agencies are maverick innovators that can deliver amazing sales uplifts through work that shapes popular culture. Many still play an important role in helping to define brands and then ensuring they stay true to those defining qualities (I guess I’m thinking of W+K and Nike, Apple and Chiat/Day here) while still others do quietly effective work that earns the appreciation and trust of their clients. So the idea of an agency is still sound, I think, while their newfound agility and willingness to embrace new ideas is indicative of an ability to pivot that most organisations would envy.

A lot of the uncertainty surrounding the role and purpose of advertising agencies stems from the word advertising. The most inspiring agency people I spoke to when running the Agency Future project all agreed with the broad thrust of the notion that, increasingly, the best advertising is not advertising. This speaks to a fundamental 180º shift in the classical marketing dynamic. Or to quote Factory Design Labs’ CEO Scott Mellin:

“The conversation has changed from ‘what do we tell the consumer about our brand or product’, to ‘what does the consumer desire/need/expect from our brand or product’.”

In other words, less push and more pull. The new marketing orthodoxy. Many respected minds believe the advertising part of this is going to be relatively small. In his well-received piece earlier this month, ‘Advertising is dying, long live design’, George Prest argues that Product Design, Experience Design and Service Design will come to comprise the three essential planks of brand success. Advertising, as commonly understood, will have a role to play within Experience Design, but a diminishing one.

That leaves all ‘the other stuff’ where agencies are learning to play. The problem as I see it is that no-one has yet simplified this other stuff into an easy-to-grasp proposition, though Prest’s ‘Design’ proposal is a more-than-worthy attempt. At my agency, we’re toying with the phrase ‘Engagement Beyond Advertising’ as a kind of vision-slash-value proposition. But we’re acutely aware of the opaque nature of the word ‘engagement’. It promises much but is unquantifiable.

To sum up

If the era of classical advertising was about persuasion through creativity, and if the notion of overt persuasion through bombarding consumers with branding messages executed with varying degrees of skill is no longer de rigeur, what defines the post-classical era? Or to return to the title of this post, what is the point of today’s ‘advertising’ agencies?

Here I can’t escape the catch-all connotations of creativity. Failing a collapse in capitalism, and assuming that collaborative consumption is not going to take over the world for a few years yet, agencies will continue to be judged on their ability to help clients succeed in business. It is agencies’ creativity that will keep us employed – by which I mean our ability to help brands stand out, connect with consumers, improve their products and yes, sell more.

All that has really happened is that the palette of tools at our disposal has gotten bigger. At the same time, the quid pro quo between advertiser and consumer has grown more transparent. People know that a brand’s ‘content’ is still advertising. They know your ‘useful’ app is still a branding tool. They’re just grateful you’re also shoving less inane crap down their throats in the vain hope it’ll get them to buy your products.

The new creativity, then, still hinges on the ability to persuade. It’s just knowing the best ways to do it without appearing to.

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