Why Disruptive Change Is Disruptive

There were many responses to my last column looking at why agencies and clients have hit the point of irreconcilable differences. Many of those responses were in agreement with me. In fact, none were in outright disagreement. This surprised me. A lot of Online Spin readers are people who work for very big agencies. I can only conclude that you elected to show your dissent through your silence.

But there were many that fell in the “Yeah-but” category:

Tiffany Lyman Otten writes, “This, like anything, is a sign simply that agencies must evolve -- again.”

Jill Montaigne adds, “Yet, our own ongoing advertiser conversations confirm that rather than walking away from their traditional agency relationships, clients desperately need and want their agencies to evolve.”

David Vawter chimes in, “As long as there is something to sell, people will be needed to create and produce the ideas that sell it.”



Agreed. But…

All of the above comments pointed to a new trend in the marketing ecosystem:a network of specialists, often in the form of micro-agencies, that appear to be finding niches to hang on to in the tidal wave of change sweeping over our industry.

I used to head one of these agencies. Our area of specialty was in user behavior with search interfaces. We did well in this niche. So well, in fact, that we were eventually acquired by a bigger agency. Bigger agencies are always vertically integrated. As such, they offer clients the one-stop-shop model. They move to that model because that is the model they know. It is the model they are programmed to create. It is an organizational form dictated by their P&L targets. There is no operational wiggle room here. They simply can’t become anything else.

Tiffany, Jill and several others all used the word evolve as if it were a magical formula for survival. But evolution is like a tree. Once your branch has been determined, you have to evolve outward from that branch. You can’t suddenly leap to another branch. If you’re a chimpanzee, you can’t suddenly decide one day to evolve into a budgie. You can evolve into a new type of chimpanzee, but you’re still a chimpanzee.

What does happen in evolution, however, is that the environment changes so drastically that the tree is dramatically pruned. Some branches are lopped off, so that new branches can sprout. This is called punctuated equilibrium, and, as I’ve said before, this is what I believe we’re going through right now in marketing. Yes, as David rightly notes, “As long as there is something to sell, people will be needed to create and produce the ideas that sell it.” It’s just that the form this takes may be dramatically different than what we currently know. It could be -- correction, will be -- a marketing ecosystem dominated by a new species of marketers.

We tend to equate evolution with change -- but evolution is a very specific kind of change. It’s change in response to environmental pressures. And while individual species can evolve, so can entire ecosystems. In that bigger picture, some species will emerge and thrive, and others will disappear. What is happening to agencies now is just a ripple effect from a much bigger environmental change -- analogous to a planet-sized asteroid slamming into the business and marketing ecosystem that evolved over the past two centuries.

Big agencies are the result of corporate evolution in the previous ecosystem. We are quick to take them to task for being slow, dumb, or oblivious to client needs. And perhaps, in the new ecosystem, these things are true. But they are the characteristics of the species. No agency intends to be dumb or unresponsive. It’s just an evolutionary mismatch caused by massive disruption in the environment.

These things happen. It’s actually a good thing. Joseph Schumpeter called it "Creative Destruction." But, as the name implies, it’s a zero-sum game. For something to be created, something has to be destroyed.
1 comment about "Why Disruptive Change Is Disruptive".
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  1. Kurt Ohare from ohare & associates, August 11, 2015 at 11:59 a.m.

    Gord -
    Re-engineering the ad biz is certainly the topic d'jour - but it's always been that way. Alright the term "always" is a bit too absolute but realistically the agency of today looks very little like the agency of 1980's.  Likewise the agency of 2040 will look nothing like what we have today.

    But we can only look back as hindsight is aways more accurate than predicting. 

    Clients dictated the current state of the agency world when they tired of the redundancy and costs associated with a global network of regional agencies and demanded that their agencies take on these global tasks. But you can't do that with 125 employees - they had to grow and the easist means to grow was to buy agencies both domestically and globally and add their capability to the new network.  So why did agencies sell - OK - for the bazillion dollars.  But also because many understood that the old agency stand alone model was no longer viable in a global marketplace. (Heck you'd sell your Tube TV Manufacturing busness in a heartbeat because although its profitable, the long term prospects are dim and the new owner can retool to produce flat panels for less than building from the ground up.) So the agencies grew to provide the services their clients are looking for.

    Now the clients are looking at the agencies and wondering why aren't they reacting to and solving the latest problems - but frankly - nobody has cracked how everything works now.  So the knee jerk reaction is "retool" the agency world - again.  But keep in mind that an agency must continue to deliver the global scale that clients need and demand.  

    The previous ecosystem has changed in terms of tactics - but the clients objectives remain the same.

    Remember that evolution is a process and that not all disruption is smart, useful or important. 

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