Our series of interviews about the widespread criticism of media agencies who are challenged by the rise of ad tech, publishers' in-house studios and claims of a lack of transparency by advertisers like P&G have featured a harsh critic of the business and an agency executive who reports rising revenues and no worries about the future.
Today Claire Austin points her finger back at the brands. She is the former Head of Audience at King Content and now works at LinkedIn as a Content Marketing Evangelist.
As someone leaving the agency business for a social media platform that is betting heavily on content, we asked Claire for her candid opinion on some of the major discussion points regarding agencies and their future in the media industry.
Here's what Claire Austin had to tell us...
Media agencies need to stand out
When you take a look at where the term ‘agency’ originates from and its original meaning, Wikipedia's definition of the term ‘agency’ is:
‘An advertising agency often referred to as a creative agency, is a business dedicated to creating, planning, and handling advertising and sometimes other forms of promotion and marketing for its clients.’
As we can see, this no longer applies! Nowadays, if you said to a creative agency "Oh so you’re an ad agency" they would probably hate on you forever! Back then in the lot less complicated era of the first agencies, this worked; you had a one stop shop for advertising/marketing. How things have changed.
Marketing is now a beast of industry, we are surrounded with multiplying new marketing options constantly, and not just marketing options, marketers are now faced with tech options. In fact last year Gartner reported that CMOs are looking to spend more on technology than CIOs in the next five years.
The ever-expanding marketing industry has created the need for new and specific expertise. Hence the number of agencies around today. I like this. Who doesn’t want experts in key areas to make for a strong marketing strategy? However, there is one issue – how many of these agencies have a real niche, a real point of difference and how many of these are just riding the latest digital marketing trend and offering a swanky tech program that will become redundant when the next trend hits? This is one key factor that is making agency world vulnerable.
How agencies can make themselves indispensable
In short a business strategy, relationships and partnerships. There seems to be little foresight for the longevity of a lot of agencies. It’s a competitive world that takes no prisoners, if you want to be indispensable you need to have a point of difference when you strip a lot of agencies back, they are naked. For example, take away their key feature, a piece of tech they have developed, many ‘agencies’ become redundant.
Their offering needs to be more robust, it needs to be creative, it needs to be strategic and there needs to be a R E L A T I O N S H I P. A lot of agencies nowadays work so transactionally with their clients, it makes for ‘nothingness’. In a recent report ‘The Naked Truth’ completed by 15 senior leads in agencies and brands, ‘98% agree that trust leads to great advertising, yet we don’t have it.’
The number of options out there quite frankly overwhelms marketers nowadays. They don’t have the time to sift through them all, but also they don’t have to time to manage 10 different agencies doing 10 different things, their role becomes a project manager, rather than a marketer. They need consolidated offerings which have created a vacuum for ad tech companies, publishers' in-house native ad studios and the Big 4 to come in and offer a broader suite of services.
The shift is happening and agencies can’t be stubborn about this, they need to evolve and future proof themselves. Partnering is a great example of how smaller (and bigger) agencies can work together to stay ahead of the game.
Publishers are reliant on native advertising and some of the ‘content’ they are producing is quite frankly awful!
Agencies are not the only ones needing re-invention
Publishers and agencies both need to evolve. Publishers are as much at risk as agencies for two reasons. Firstly, they are reliant on native advertising and some of the ‘content’ they are producing is quite frankly awful! If they get too greedy and go after scale over quality content, they are going to fail – they will ruin their reputations and authority. Secondly, brands are muscling in on the territory traditionally owned by publishers.
Take GE Reports, their mission is to become the world’s best publication for science and tech. Publishers are finding it hard to compete with specialist content marketing from brands – they’re not evolving or challenging them. If they don’t start acting like brands they are going to be in trouble. Everyone in business needs to redefine their roles and services in order to be relative to the changes that are constantly taking place in this digital era. As soon as we stop we become redundant. Simply, if we want to succeed we need to push the boundaries and often that means doing something different.
On whether advertisers need the expertise of agencies
Whether advertisers need the expertise of agencies depends on two things; what does the brand need and what does the agency add? Marketing teams are vastly expanding, it is the area of businesses that everyone is staring at, looking for answers, forecasts, results. As a result, there is a lot more focus on building up the expertise in marketing teams; this works two ways. You build it in house eg. HP Studios – a brand new creative studio to develop ass kicking content – which by the way they are nailing. Or you outsource, to an agency, it often works out more cost effective as you don’t have the overheads etc.
However, companies are only going to continue to do this if they have a relationship with their agency – if they can trust them if they can provide them with insights and strategic advice that adds value in a way that publishers and media companies can’t.
Brands say how high and agencies jump higher.
The hardest thing for agencies
The hardest thing for agencies at the moment is that brands still think in campaign cycles. They brief agencies and then expect ‘viral’ ideas in the quickest turn around time and for zero money. Unfortunately, agencies jump, brands say how high and agencies jump higher. To this point, in Singapore, agencies are paying to be able to receive briefs and pitches!!! This is insane! It just shows how competitive it is out there.
Brands have the upper hand and agencies are letting them get away with sloppy briefs, ridiculous turn around times, and price cutting. This can’t continue, there’s a limit and we’re nearing it. This is where agencies need to start thinking outside the box about how they attract brands and show their value and awesomeness without losing credibility as to be seen as "we’ll take anything". They need to educate clients, guide them on briefs, be realistic about what can be achieved in the proposed turn around times. But most importantly they need to understand that great content takes time to create and the idea of ‘campaigns’ sit in the ad world, not in the content marketing world.
The result is good content, not great content, which makes agencies look bad, it’s a shame.
When given the right time and budgets, agencies can come up with amazing work that will show it’s worth 10 fold. But what we are seeing at the moment is creative and strategists and account managers who are run ragged trying to juggle a hundred different things and trying to pump out ideas in stressed time restrictive environments. The result is good content, not great content, which makes agencies look bad, it’s a shame.
Agencies will still be around for a while longer, but I think we’ll see more mergers, acquisitions and repositioning. I don’t think ad tech and publishers are the threat, I think the Big Four and freelancers and digital nomads are the threat. Contracting is becoming a lot more appealing to employees and employers. Brands have the opportunity to take more control, which they are – just look at P&G. No one is safe.