174 years ago, “V.B. Palmer’s” opened its doors in Philadelphia as the nation’s first advertising agency. Founder Volney Palmer pioneered the notion of a business acting as an agent between advertisers and media companies by representing, organizing, and procuring ad placements.
Back then the media landscape was simple—singularly comprised of about two thousand newspapers. With its expertise in the space, V.B. Palmler’s quickly became a one-stop shop for advertisers looking to promote their goods and services in the most efficient way possible. And Volney Palmer’s advertising agency continued to grow and expand as a result.
We all know how the next seventeen decades would play out. Creatively, agencies formalized the roles of art director and copywriter and held on to that model beyond the print dominated world. As more and different kinds of media entered the landscape, the advertising agencies that couldn’t evolve their capabilities fast enough were relegated the “traditional” label while nimble specialty shops continued to pop up and gain foothold.
Big brands suddenly found themselves with a seemingly endless roster of agencies by media type—and also a massive headache. Any given brand could have a traditional agency, media agency, digital agency, social media agency, mobile agency, CRM agency, experiential agency…and the list goes on. While clients expect their agencies to partner well together, their inherent (and growing) overlap creates a culture of competition and passive aggressiveness that constantly brews below the surface.
Simply put, a channel-driven agency roster doesn’t work anymore as it leads to fragmented customer experiences. Today, media is all mashed up and the content that people consume no longer fits into clean “buckets.” The irony is that the very tech-driven revolution that caused this agency fragmentation in the first place is quickly leading the media landscape back towards a singularity—back towards one media: The connected screen.
We spend most of our waking hours with the connected screen: Smartwatches, smartphones, phablets, tablets, laptops, and smart TVs. Like the paper in newspapers, the connected screen is the delivery medium for content and experiences in all sorts of formats. But unlike newspapers (from where the advertising art director and copywriter roles were born), the connected screen makes it easier than ever for people to avoid messages they don’t want while instantly showing others how they feel.
At a time when consumers can’t wait to press the skip ad button and where ad blocking is one of the hottest topics in our industry, consumers will direct their attention only to what’s most useful or entertaining to them—at any given moment. Advertising today is less about adjacency and far more about just being “the thing”—a mix of interactive storytelling (through content) and utility (through technology).
In the connected screen era, art and copy must yield to customer experience and utility—And agencies must re-organize themselves to fulfill consumer needs. As this happens, the days of agency specialization will give way to a kind of homogenization reminiscent of decades past. Brands’ agency rosters will increasingly get shorter as it’s becoming unmanageable to relegate a given agency to their assigned “swim lane.”
It’s why ad agencies, PR agencies, and digital agencies are all starting to look and sound the same. It’s why these same agencies are suddenly finding themselves competing against companies (like management consulting firms) that have never been viewed as material competitors. And it’s also why brands’ own in-house capabilities are progressively a threat as the trend of insourcing content creation persists. They’re all trying to evolve their capabilities in content and immersive experiences—and it’s fueling the already existing tension on brands’ agency rosters.
In 1841, Volney Palmer never considered his company a newspaper agency. It was an advertising agency that made the most out of the one media that just happened to exist at that time. We’re now at a time when traditional, digital, mobile, and social all mean the same thing. The agencies that will emerge on top will be the ones that let go of their advertising pasts and organize and execute around fulfilling needs for consumers along their journey with brands—knowing all the way that the connected screen is the one media at the center of…everything.
Many valid points, Mike. And even within types of agencies there are silos---or, rather, separate fiefdoms jealously guarded by their inmates and bosses to prevent encroachment by "outside" departments. And within departments---or silos--there are still more layers. Hence ---a few exceptions aside---in media, the planners and buyers ----especially national TV buyers---are not really on the same page. Worse, "digital" and its allied "programmatic" buying arm are staffed by specialists who are not familiar enough, if at all, with "legacy media".
How does all of this get fixed when advertisers keep squeezing the agencies, demanding lower and lower fees for more and more service? How do the agencies fund the currently non-existant training programs required to begin the process of integrating their services and capabilities? I'm not sure I have an answer.