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November 16, 2008 / davebirss

The future of digital agencies

I don’t usually do this but I’ve decided to republish a post I wrote over a year ago because it says a lot of the things that are on my mind at the moment. I’ve been talking to my digital buddies in a variety of agencies recently and finding this topic coming up in conversation – probably because there’s a general fear of the future in Credit Crunch-ville. And it’s a prelude to another more damning post that’s brewing. Enjoy!

A few weeks ago I was explaining to a fellow digital Creative Director how I thought the industry had evolved and where it needed to go in the future. Please let it be known that beer was involved. Since that blurry evening, my explanation has clearly spread and been resold to me a couple of times. So I thought it may be a good idea to share it on the blog. I’ve even created some images to compensate for the lack of wildly gesticulating drunken hands.

It starts like this. Up until recently Digital was seen as a distinct marketing discipline. It was as separate a skill as Advertising, DM or any other area of marketing . But this was only because of one thing – ignorance. Only geeks understood digital and the rest of the industry didn’t quite see where it fitted in to what they did. Digital became a marketing discipline by default. So this is how things looked:

Ye Olde Days

And to be honest most digital agencies are living as if this is still the reality. But it’s not. Things have moved on. The internet is part of everyday life and the other marketing disciplines understand it a lot more. They see how it fits into their own corner of the industry and offers them more opportunities. It has been embraced by all the other marketing disciplines as part of their services. And this is how the landscape really looks now:

Future of digital

So the question is – how should digital agencies respond to this change? I can see 3 distinct approaches.

The ‘LA-LA-LA. I CAN’T HEAR YOU!’ model

A lot of agencies seem to be pretending it’s not happening and are carrying on regardless. This may be OK for a few years yet – but they will eventually be forced into making a move into one of the other two options or die out.

The ‘you come up with the idea, we’ll make it happen’ model
Advertising agencies outsource a lot of production to specialist companies. TV production houses make bits of film, recording studios do their radio spots, photographers bring their print ads to life – so why wouldn’t other marketing disciplines just take control of the digital side of their business and outsource the production to the specialists? It makes sense. This appears to be the way they’re doing it in the States. The Barbarian Group has produced award-winning stuff for agencies like Crispin Porter + Bogusky, Mother and Wieden+Kennedy. Over in the UK we also have production hot-shops like Unit9 that seem to be doing well. But this is all high-production-values, eye-popping stuff. There is also a need for the digital equivalent of brochure, doordrop and scratchcard production – and everything in between. And there will be more of a need for this kind of facility as time goes on. Some digital agencies will do well as production shops.

The ‘ Wow! What an awesome idea’ model
If the first model is ‘be a bit creative’ and the second model is ‘let other people be creative’, the last model is ‘be awesomely creative’. This is the model I naturally prefer. The real value any agency can offer is strategic creativity. There will always be room for agencies that know how to engage with audiences in a fresh and relevant way. Strategic thinking, creativity and innovation needs to be at the heart of these agencies because if they start plumping for formulas they’ll be overtaken. They can’t limit themselves to thinking in terms of banners and buttons. They can’t limit themselves to what happens in a browser. They need to break new ground in mobile, applications, digital outdoor and whatever new technology emerges. This is the scariest and most exciting part of the industry because it will evolve from year to year.

What surprises me is how stuck-in-a-rut the digital industry is. It’s barely 15 years old and atrophy seems to have set in as much as in the more established parts of the industry. Change is the only constant and the future lies with the companies that are nimble enough to keep up.

And here endeth the sermon. If you think I’m spouting a load of old cobblers – or stating the bleedin’ obvious – please add your wisdom to the comments area.

10 Comments

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  1. adam cleaver / Nov 17 2008 4:45 pm

    This is a really interesting article – but i do think that all agencies (not just digital) must expand past their traditional capabilities to survive in the new marketing landscape. The bigger issue remains who is best placed to expand and create the better solutions. I believe ‘good’ digital agencies have several advantages:

    Innovation. Good digital agencies are melting pots of technical, strategy and creative and that can help them produce more innovative solutions. For us, great digital ideas are just as likely to be inspired by the technical ‘geek’ in the corner as they are the hot-shot creative. I feel placing the whole technical component in a different agency really limits this and makes creating campaigns a much more linear and less innovative process.

    Working practises. For whatever reason, there are fewer egos and fewer silos in digital agencies (a product of having ‘less time’ perhaps?). I’d say this breeds the more collaborative attitudes and working practises that in our experience, clients are very keen to see. What’s more, some traditional agencies have a real image problem when it comes to how work is delivered and that limits their appeal to both the ‘old experienced heads’ that they need to employ and the new kids coming through.

    Agnostic. Ad agencies will often veer towards an ad based /content based solution. DM agencies to a more direct marketing approach. Incredibly as it may seem, digital agencies can often be more agnostic with the solution than other agencies. This can make them a more attractive proposition to clients, especially if they offer production/content services.

    The nature of ‘digital’. I think that ‘Digital’ encompasses more than the five other disciplines mentioned. To my mind what a good digital agency does is as much about product design (or even engineering/architecture) as it is pure marketing. In other words when you take all the marketing strands away from digital, you still have something very important left.

    Your second diagram is certainly correct, but I’d still retain digital as a separate strand within it. Perhaps we should just call it something different? I’m thinking ‘Bernard’… any takers?

  2. davebirss / Nov 17 2008 5:30 pm

    Thanks Adam,

    What fantastic feedback.

    I absolutely agree with you. Collective is an awesome agency and fits in with the third model. There will always be a place for companies that are brilliant at what they do.

    And you have a great point about digital encompassing so many disciplines. In my view it’s just a pixelated reflection of the real world. It still has paid advertising, publishing, broadcast, brochures, PR, direct response and S&M fetish clubs like the real world. True digital experts know how to use each of these channels in the best way.

    And I like ‘Bernard’. I’m going to change my job title to ‘Bernard Creative Consultant’. And we can catch up at the next Bernard Media Conference. Brilliant!

  3. Sam Brownfield / Nov 17 2008 6:33 pm

    Hi Dave, glad to see someone else having this debate. The last three posts on our blog are on the same subject. Have a read: http://www.tradewindlondon.com/blog

    Our concern is predominantly that the right agencies do the jobs they are good at and don’t try to eat each others lunch (to the detriment of the paying client). A comment in the debate that most resonated with me was about digital agencies not being wedded to the “big brand idea” and thus are more in the mindest of exploring how “consumers actually engage” with the media.

    Digital agencies are more often than not, not invited to be more integrated or to pitch for the integrated work and the reasons why are obvious. Why doesn’t it work the other way round therefore?

  4. davebirss / Nov 17 2008 7:57 pm

    Hi Sam,

    This topic seems to be on a lot of people’s minds at the moment. I’m glad to see that you’re talking about it too!

    Your argument that the right agencies need to be chosen to do the job is being used by both sides at the moment.

    On one side there’s digital agencies saying that they’re the ones who’ve been doing the microsites, banners, viral films and content up until now – so they know how to do it best.

    And then there are the ATL agencies saying that their skill sets and creative abilities suit these tasks best. Banners are paid media that are used to communicate an on-strategy message – and that’s what they’re good at. And they’ve been producing films since before the internet was invented – so that’s their bag too. They’re just reclaiming what is rightly theirs.

    And both sides are right (and wrong). However, clearly the side with more money and more influence with the client will win. So all this contentious stuff is ultimately going to the big agencies whatever anyone in Pixelville tries to do about it.

    So the job, in my far-too-outspoken opinion, is to make sure the big agency folk learn the new skills required so that they can do their job well. And the digital agencies who are having the work taken away from them would be wise to service the digital production needs of the ATL agencies.

    I’m not saying it’s what I want or what I think is right. It’s just the brutal truth, as far as I see it.

Trackbacks

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