• by Joe Mandese  @mp_joemandese, December 20, 2007

A decade after Madison Avenue began unbundling the worlds of media and creative advertising services, the two disciplines are becoming reintegrated - but this time it is media that is leading the cart, as media services agencies become more vocal about their role in driving the creative process, and offering creative services that compete with traditional "full-service" agencies. While many of media operations of Madison Avenue's top media agencies have been doing so quietly for years, Publicis' Starcom MediaVest Group shook things up Wednesday by taking a very public stand about offering a standalone creative services unit (MediaDailyNews Dec. 19), and the move has encouraged others to speak out about their own progression into creative services.

On Wednesday, Media Storm, a spunky media services boutique based in Norwalk, Conn., which services a lot of media and entertainment industry accounts, also announced the spin off of a creative services shop: MAUDE. Tim Williams founder and managing partner of the six-year-old media independent, said the shift into creative services has been driven by demand from clients, which include a roster such as Food Network, Court TV, The Weather Channel, FX Networks, SPEED, NFL Network, Fox Broadcasting, Fox VOD, Shopzilla, WE tv, DIY Network and Fine Living TV.

"Many of our clients asking us for creative input and thinking, which we have gladly obliged," he stated, adding that the time was right to "make creative another core competency" of Media Storm's operations, and that spinning off MAUDE was the way to do it.

Top industry leaders agree, especially David Verklin, the CEO of Carat Americas and Carat Asia-Pacific, who has tacitly said media agencies like Carat have organically been moving into the role of creative services agencies for years. And though the agency didn't make a lot of noise about it earlier this year when it merged Carat and interactive agency Carat Fusion into one entity, Carat technically became the first major media agency to begin offering creative services, because Carat Fusion has always provided them part and parcel of servicing interactive media assignments.

"Carat is now a full-service agency, in the simplistic sense of the word," Verklin said. He noted that most big media shops - even those held by Madison Avenue's large agency holding companies - have tacitly begun providing creative services via interactive, branded entertainment and other units, but until the Starcom MediaVest announcement, have been loath to state it as an explicit function for fear of antagonizing other relationships in their organizations. Verklin said that was the most important thing about SMG's announcement on Wednesday.

"What I find most interesting is the freedom and power that [SMG] has to get into and overcome the internal kind of turf wars that would stop this from happening in other media agencies," he said. "They have enough mojo within their own company that the can say they're creating a 21st century digital creative unit... It's a remarkable story."

Verklin said Carat has no such issues within Aegis Group, because unlike Publicis, WPP, Omnicom, Interpublic or Havas, Aegis does not operate any traditional creative services shops, and evolved its role in creative services through its media enterprises - first with interactive shops that comprise its Isobar network, and also via Posterscope, its global outdoor media services network, which also provides creative services.

"That was easy for me to do, because I didn't have any creative agencies to deal with. There was no channel conflict," he said.

But other big media shops affiliated with big creative brand agencies inside agency holding companies are beginning to acknowledge as much.

Alan Cohen: "Since 2005, our view of making media the new marketing has won us numerous clients that think of us as their 'ad agency,' not their media agency," acknowledged Alan Cohen, who launched Initiative's Innovations unit and is now managing director of the agency's West Coast offices. "At Initiative, often we write the strategy documents that inform our clients on how to brief all their agencies, and in many cases we end up producing and executing the creative because we have the resources and partnerships to do it."

Even so, Initiative has never come out and explicitly said it was spinning off a creative services unit within its organization the way SMG did on Wednesday, though such distinctions are likely to fade ad media and creative services begin to blur as a result of the growth in digital media. Interestingly, SMG's announcement downplayed the role of "online" and emphasized the role of "digital," even as it subordinated "media" vs. "creative." In the 599-word released it issued Wednesday, SMG used the word "digital" 11 times, but only used the word "online" once. Similarly, the release used the word "creative" 11 times, but used the word "media" only four times.

Such stats may seem trivial, but the language that agencies use to describe their services speaks volumes about the way they think of themselves internally, and how they pitch themselves to clients and the trade at large.

The second big aspect about SMG's announcement, and the implicit underlying trend within the industry, Carat's Verklin said, is the recognition that digital creative services is now deemed a viable, standalone service - and one that is an important component of media agencies.

"It's a sign of the maturation of the business," he said, adding however, that it raises some big questions. Noting that digital creative generally generates smaller revenues than traditional media creative, because digital production is so much cheaper than analog production, Verklin said a key question remains, "How do you get paid for this work?"

While she did not explicitly answer that question on Wednesday, SMG Americas CEO Laura Desmond implied the agency was having no issues on that front and the fact that it is rolling its Pixel unit out from an incubator to a stand-alone service indicated that it has sufficient cash-flow and profitability to stand on its own.