• by Cory Treffiletti , Featured Contributor, October 25, 2006

Bundle, un-bundle. Bundle, un-bundle. The agency business is cyclical, and for many years we've witnessed clients shifting from the bundling of services--the practice of having one or two agencies that handle all components of a client's marketing needs--to un-bundled services--hiring any number of agencies to manage each individual element such as print, broadcast and interactive services, media or creative, etc. However, some of the news I've read over the last few weeks appears to signal that this cycle may finally be coming to an end.

First off, IPG announced recently that it was rolling back its media units to each of its full-service agencies, allowing them to create an increasing integration between their creative and media practices. Media Kitchen recently announced it will offer consulting services for media as an in-house solution for creative shops that need to find stronger integration with media. Across the board, we see direct marketing firms merging with interactive and we see traditional agencies shining more of a light on their interactive service lines. What this all signals to me is that people are starting to get what we've known all along in the interactive side of the business: that media and creative cannot be separated anymore.

Whether you call it integration or collaboration or synergy or whatever buzzword you've assigned to this phenomenon, it simply boils down to the fact that media planners need to think creatively, and creatives need to think about where their message is being conveyed. To hearken back a few years, it refers to the marriage of message and media. The environment online is such that a message can be determined to be effective very quickly due to the accountability of the medium. Once a message is determined to work or not to work, optimization can occur and a campaign can improve in performance over time. In traditional media you had to place more of a bet on your strategy, because it took too long for the audience to cume and to amass enough data to determine performance. In that environment the media and creative could be separate, and each would blame the other for ineffectiveness. In today's marketplace, that is no longer the case. I know what works and what doesn't in digital media--and I can no longer point fingers.

According to sources like eMarketer, online ad spending should reach 10.1% of total spend by 2010. This refers to online advertising, but my definition of "online" is broader and includes any form of media that possesses the ability to have bilateral communication and exchange data from the audience. That means mobile, digital outdoor, digital television, digital radio and many other formats emerging over the last few years and poised for adoption over the coming few months, should count towards this growth. I predict that these digital extensions of traditional media, which take the formats of traditional media and integrate the accountability, flexibility and online contact of the interactive space, will grow very rapidly. It is safe to assume that online spending, under this expanded definition, might reach as high as 20% by 2010. This might sound aggressive, but I think it's realistic given the rate of adoption for new technology in a consumer-centric environment such as this. As this phenomenon occurs, we'll see that media and creative need to be integrated in each of these formats in the same manner as they are online, so consolidation of media and creative becomes more important than ever.

As traditional media evolves to include a digital component, the rationale for tighter coordination between media and creative expands beyond the parameters of the current online world. Media people should plan creatively, and creative people should consider the location of their messaging. This marriage of the message and the media will continue to deepen and the relationship will grow stronger. This signals more consolidation and the end of the cycle, as advertisers truly understand that integration means thinking about the delivery of a message across many formats of advertising.

So bundling, or consolidating your agencies for media and creative, seems like the wave of the future, but it may not mean what you think it means. It's possible you'll see agencies begin to bundle their services together, with strategy being led by the interactive agencies they work with, since the interactive agencies know how to operate in this new environment. Interactive agencies understand how to sift through all the data and discover the nuggets of information that drive improved ROI for your marketing dollars. We'll see how the holding companies respond to this model, and we'll see how the consultants position themselves for this change. Till then, take a snapshot of your business now and see how you manage this integration in 2007!