Commentary

The Evolution Of The Agency Biz Is Clearer Than You Might Think

The advertising business now changes about every 10-15 years. We’re at the tail end of the Media Era, about to enter the  Technology Era, which will be unlike anything we’ve seen in the past.  

When I first got into advertising and marketing, the pendulum was just shifting.  I entered the business at the tail end of the Creative Era, which had  experienced an extended period of dominance.  “Mad Men” gave us a view into what things were like then, with the spoken word able to wield the power of a WMD when used by a suave ad man like Don Draper.  It was all about the big idea and the ability to weave together a story that resonated with the mass audience.  That era lasted from the ‘50s and ’60s, up through the mid-‘80s. It was right about 1991 when you started to see things really shift.

In the Creative Era, we saw the agency landscape dominated by hyphenated agency names highlighting such industry giants as David Ogilvy and Bill Bernbach. These were among  the most creative people ever to grace the ad world.

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But as the landscape changed and cable broadened the TV audience while the magazine industry exploded into smaller, niche publications, the art of advertising was refined, as science began to have a role in the development of the audience.  The agencies that dominated during the creative-driven age had to make way for the media-centric shops that have become so familiar over the last 15-20 years.  

The Media Era was less about the name of its leaders and more about the anonymized power of the holding company.  Omnicom, Publicis and WPP gave birth to media-driven agencies that started to take the lead. Creative was still important, but there was now a balance between creative and media that hadn’t previously existed.

The birth of the Internet drove the increased importance of media.  All of a sudden the masses had access to even more of whatever they wanted, so their attention became fragmented, even as creative-driven agencies threw out more and more ingenious messages. In the Media Era, we saw the rise of the analyst and an increased reliance on data.  Media created more proof of resonance with the audience and even became an art unto itself.  

When first I started in the business, still in the Creative Era, a two-hour client meeting consisted of an hour and 40 minutes of creative discussion, with a 20-minute session dedicated to the media recommendation.  These days you can see a more significant balance, with as much as two hours dedicated to media, and perhaps a separate meeting about the creative.  The Media Era also created more specialization, with teams focused on “online vs. offline,” and then subsegments of online like “paid vs. earned” or “banners vs. native or social.”

Twenty years into the Media Era, it’s easier to sense the winds are shifting once again. We’re headed inevitably toward the Technology Era, where it’s not about creative vs. media, it’s about manual vs. automation.  This stage will witness a new kind of company rise in importance, with the consultancy approach.  Companies like Accenture, PwC and Boston Consulting are buying their way into the agency business to manage technology and automate processes, both in media as well as in creative.

As the world fragments more, consumers are curating their technology stack and brands are being forced to play catch-up, tasked to offer new ways to engage customers. Technology is the only way to keep up.  It’s fighting fire with fire, and media agencies are starting to recognize this and take similar steps forward.  

The battleground of the next 10-15 years should be between the consultancies and the media agencies, with the creative shops attempting to hold onto the “strategy” element to offset the need for a singular big idea.  The names might change, but the goal is still the same: to own the ways brands interact with their audience. 

Are you preparing for the shift? What is your strategy to stay relevant?

3 comments about "The Evolution Of The Agency Biz Is Clearer Than You Might Think".
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  1. Seth Ulinski from TBR, May 27, 2015 at 5:52 p.m.

    Great write-up, Cory.  We've identified three types of participants in this new digital marketing services landscape: digital agencies, IT services firms, and management consultancies.  While data/analytics and system integration work play to strengths of IT heavyweights like IBM, Accenture, etc -- the big idea and creative elements still carry significant weight when CMOs are selecting an AOR.  However at some point soon I think a Fortune 500 brand will hand all creative/media duties to an IT services firm that has acquired a boutique or two -- that's when things will get interesting.

  2. Henry Blaufox from Dragon360, May 28, 2015 at 2:15 p.m.

    Seth Ulinski, to some extent it's already happening. Sapient acquired, or was in on the founding, of Nitro. They became Sapient Nitro in the mid or late 2000s, combining Sapient enterprise, global IT expertise and clout (India based development teams) with Nitro interactive marketing. Publicis' acquisition of Sapient earlier this year was done to put that tech expertise and development methodology at the forfront of the holding company, its agencies and clients. Sapient senior management have leadership positions now at Publicis.

  3. Mike Glover from Gravity4, May 29, 2015 at 6:18 p.m.

    Thanks Cory - another excellent and timely POV shared. 

    I couldn’t agree more that a new epoch is upon us - and this time round, as indicated, it will be a battle of technologies to automate what has been to date a largely manually driven enterprise.


    Media Agencies - I don’t think so. By and large they remain persistent in clinging onto the the early vestiges of the Media Era era, increasingly by the skin of their teeth. A time defined not so much by data as by TV rebates and kick backs. Sure, the trading desks have whet their appetite for 50% plus margins, but even that remains peanuts compared to the spend across traditional channels. Added to that the issues around complexity, multiple stake holders taking a clip and the lack of transparency and it’s clear to see why they have their work cut out.

    The Heavyweight Consultancies - maybe. They are certainly doing a much better job than the Media Agencies in engaging with and assisting clients in navigating the tech space but technology agnostic they are not.

    Digital Agencies - little to no chance. The majority simply don’t have the resources to build out the technology required to bring scalable, enterprise automation to marketing and advertising. Sapient is perhaps an exception, but their business model deliberately excludes media and I don’t believe that Publicis will enable a meaningful shift here anytime soon. (cont...)

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