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Prediction: Digital Shops WIll Disappear

Advertising is in the midst of a sea change.  There's an exciting new medium out there, and it just may be the greatest selling tool ever invented.  

But it is so different from what's been available in the past that many of the entrenched practitioners within the agency business don't understand how to use it.  And clients?  It seems they're even more lost at sea – especially those who are over 40.

The new medium opens up many questions, and there are few models and little experience to draw upon.  How do I create for it? How much of my budget should I allocate for it?  How do I buy it?  How do I measure it?

We're talking about the digital revolution, right?  Actually, the scenario is from 1947 and the mysterious new medium was television.

Fast-forward 65 years and the advertising and marketing communities are wrestling with the same questions, except the medium in question is digital. What was once new is old and the new presents many of the same problems — and even more opportunities — than the old sector that many predict will eventually replace it.

Clients and agencies are wrestling with perceived complexities and nuances of the new digital communications tools.  Traditional agencies were at first slow to adapt – in fact, many have barely, if at all, tried.  To fill that gap, a new breed of digital shops emerged. But I say they will be short-lived.

In the midst of all this change, clients have been demanding digital recommendations, often without stopping to consider that "digital" is an omnibus term encompassing everything from hosting and Web site development to mobile and social applications.   Some agencies, eager to please, have rushed to put their clients onto YouTube or Twitter before the proper messaging has been developed and without taking into consideration that many digital venues allow — even encourage — the consumer to talk back.

With all these changes and so many new subtleties, why do I predict that specialized digital agencies will not thrive over the long term?  It’s not because digital media will go away. Quite the contrary: it may very well unseat "king television" as the greatest selling medium of all time. Recent reports indicate that’s about to happen.

Specialized digital shops will eventually disappear because digital, in all its myriad forms, it's still nothing more than another medium to be added to the marketing communications tool box available to agencies and their clients. Yes, it's a big one, but it will never entirely usurp the media mix of most companies and brands.

Jump back a generation and you'll see the pioneers of TV were essentially showmen and entertainers; marketing objectives and long-term strategy were foreign to them.  But agencies understood and they jumped in and took control of the medium from a marketing point of view.  There were no real television agencies, at least none that even put a dent into the historical record.

Today, there are digital agencies, and they've been able to build a certain allure, since so many "non-techies" have been intimidated by the new technologies.  The founders of many of the digital shops, just like the pioneers of television, have come from a technical and tactical background, and not a brand-building or strategic background.

What the digital folks provide is critical, to be sure, but only in the larger context of long-term strategic brand building and a 360-degree marketing mix.

My prediction?

Digital shops will disappear, either through the development of strategic marketing skills and broad media expertise that will make them, essentially, traditional agencies.  Or, as we have been seeing lately, these digital shops will be absorbed or merged with broader traditional agencies.

While we may not yet have the paradigm of the 21st century, we can safely say that digital is here to stay.  The pure-play digital shop, however, is not.

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1 comment about "Prediction: Digital Shops WIll Disappear".
  1. Joe Hasselwander from Tangence , September 12, 2012 at 8:18 p.m.
    Interesting take, Lynn. I might like to see this trend, if only to momentarily help re-simplify the marketing universe for clients. But I suspect we may see the opposite. It's been a long time since the television age, where big agencies seized and mastered disruptive marketing technology. Like boutique branding and market research agencies before them, today's digital agencies emerged because the big traditional shops were far too slow adopting to these trends, and client demands for them. I recall this vividly from the late 90's, when as a client I had to hire small digital shops for competitive advantage because our high-retainer partners just weren't there yet. I think the big shops are impressively catching up today, enhancing their digital offerings and absorbing digital-only shops. But social media is such an acceleration of digital, it appears likely to prolong the life of now-established digital shops and niche players, continuing the nearly two-decades old digital marketing age. I see slower traditional firms playing yet another round of catch-up -- I just don't see them leap-frogging digital agencies and mastering social any time soon.