Reality Check: Agencies Aren’t Dead, Far From It

You can set your watch to the “death of the agency” articles and debates. First it was Google that would kill the agency. Then it was crowdsourcing. Who knows, maybe social media is the next supposed agency killer.

The truth is agencies aren’t going anywhere, although there’s real change afoot. Just like out there in the real work, natural selection is at play. As agencies come from different floras/faunas, the ones that don’t adapt to the current times are the ones that go away. We aren’t all screwed, just the ones that remain stagnant.

Every fad has its end. When a certain category emerges in the landscape, there tends to be a common response. Whether it is digital, mobile, addressable display or social, it starts with the launch of specialist agencies who try to convince everyone that they have it figured out (“Hey, it’s all that we do!”). The holding companies then get nervous and start buying up the ones that pass a preliminary smell test. What ensues is a parallel process where the adept agencies train or hire the talent to handle the fad while the standalones that remained from the buying spree start to fold or change their business model. We’re in a bubble right now, people, and this social fad will ebb, evolve and become part of the mainstream. Remember: Yahoo bought the social network GeoCities for $3.6 billion in 1999. Instagram is a steal for $1 billion!

But digital media is not slowing down anytime soon — and that’s a great thing for the agency business. Complex environments are an agency’s friend. Client organizations will always need help figuring out marketing problems. The agency is the nimble, creative force that helps keep the client up to speed on the latest trends with their audience and how to harness it for campaigns. One of the challenges that some agencies cannot handle is that a good idea can come from anywhere (and clients are starting to realize this). No longer can the creative director in the black turtleneck and South African accent command the spotlight. This dynamic is great for brands and agencies alike. Good ideas win!

Agencies need to define what it is they do. What the hell is “social media” anyway? The key for agencies is clearly communicating their role within the space, say, like social media. Are you a content creator/syndicator? Do you just buy Facebook ads? Are you now a Facebook Timeline design house? Whatever it is, plant a stake in the ground for enough time to gain some traction/credibility. Just don’t build the foundation in cement in case your bet isn’t paying off.

There’s plenty of snake oil other there. Agencies touting paid, owned and earned media are just trying to sound different when their business is the same as everyone else’s. This is just a re-definition of what agencies have been doing for years. If you create engaging and relevant content and properly distribute it to a brand’s target audience, your need for media will automatically decrease. The problem is that this focus on content creation hasn’t been pushed by brands or agencies as of late (or enough). Media is the “get out of jail free” card for brands who don’t understand content or SEO (or their audience). Responsive design doesn’t hurt either in today’s world of mobile consumption.

When agencies and clients stop being lazy, we will see true performance in our work. The reason that the majority of online advertising doesn’t work is because it isn’t relevant. You want to see what relevance does to performance? Look at search advertising and Google’s stock price. And that’s a text ad. All we need to do is harness the audience understanding that we have, develop an arsenal of diverse, compelling content that can be delivered based on cookies and user behavior and set clear goals for optimization, and we’ll see a great improvement in our efforts. Emotion still wins people, even if the means of content consumption change. So, the next time you are getting ready to repurpose that 30-second spot for your online video campaign or post the same piece of content across Facebook, Twitter and YouTube, ask yourself if that is the lazy route to take.

So agencies aren’t going anywhere anytime soon.


Rick Corteville is CEO of Luxus, an advertising network headquartered in Finland.

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