Do Agencies Deserve a Seat at the Grownup’s Table?
“The best minds of my generation are thinking about how to make people click ads. That sucks.”
I’ve been thinking a lot about this quote from Jeff Hammerbacher, founder of Cloudera. But rather than the ad platforms, my thoughts go to those people who make the ads.
Ad agencies, creative and digital agencies, media and PR agencies - they’re full of some of the brightest, most talented, most curious and creative minds on the planet. A handful of these brilliant people will be lucky enough in their career to work on creating a 30 second spot that gets aired at the Super Bowl. For the remaining millions of talented individuals in this industry, the grand sum of their genius is more likely to be localising an ad for washing powder and running it on YouTube or Facebook.
Despite agency groups' attempts to diversify and move up the food chain, they are still mostly stuck in the cycle of receiving briefs rather than writing them.
So in this article I’m going to answer the question: How can agencies claim their rightful seat at the grownup’s table?
Don Draper is dead
I’ve watched Mad Men all the way through at least three times. And as sexy as it might seem to emulate Don Draper, that’s just not the way the marketing world works anymore. These days, if you walk down the halls of an ad agency you’re much more likely to run into a data analyst who is great at crunching numbers and feeding them into an algorithm than you are to meet a dapper ladies man who effortlessly jots down genius ideas on the back of a cocktail napkin while waiting for his date.
I actually started my career in the agency world, first starting my own boutique shop and then graduating to General Manager of one of Australia’s most awarded digital agencies. And I’ll admit, during that time I did romanticise the role that we played in the business ecosystem - I led a group of super talented strategists, data analysts, UX architects and researchers. We felt like rockstars, locking ourselves in a war room for weeks at a time, spending our evenings splitting pizzas and beers while filling up whiteboards with the outputs of our epic brainstorming sessions. We would emerge on pitch day hyped up on adrenaline to share our brilliant ideas with the client in the hopes of winning their business. It was a rush, and we felt like the work we were doing was of critical importance.
And then I joined Deloitte. My first meeting was with the CEO of a Fortune 500 company, who came to us to ask for help to launch a new product. They asked us to help determine which markets they should launch their new offering in, what the product features should be, and where they should be allocating budget. The level of transparency and collaboration was on a completely different level than what I had been used to.
It suddenly dawned on me that the briefs we’d been receiving in my agency life weren’t the beginning of the process as I’d imagined - they were actually right down at the tail end of a lengthy sequence where all the important decisions had already been made.
Despite our agency’s capabilities, the depth of relationships with clients and trophy case full of awards, we simply weren’t being invited to take a seat at the grownup’s table. It was an enlightening realisation, but also very humbling.
Agencies are like train drivers
When I first started working at Facebook, a key part of my role was building partnerships with the large consulting firms such as BCG, McKinsey, Deloitte and Accenture. My boss at the time was a veteran of the marketing industry, having been a leader in both client organisations and big network agency groups. He gave me a great analogy that always stuck with me:
Agencies are like train drivers - they receive a brief from the client and it’s then their job to execute it. The brief tells them where to start and where to end, what time to depart and arrive at the station, what speed they should drive at and how many passengers they should expect. It’s then their job to make it happen and conduct the train ride as smoothly as possible to get from point A to point B. But what a lot of agencies don’t see is that before they even receive that brief, a consulting firm has typically been working with the client to map out the route and lay down the train tracks, essentially making the key decisions and setting the parameters that determine how the train ride will go.
This system seemed to work pretty well for a long time, but increasingly we’ve been seeing automation creep in. Platforms like Facebook and Google made the train ride algorithmic, optimising the departure and arrival times and the configuration of carriages. The ticket cost was dynamically priced based on real-time data. Over time, the train driver’s job had been reduced to simply supervising the process and making the occasional announcement over the loudspeaker. Now with the rise of AI even that role is increasingly being squeezed.
In short, there will come a day soon where we don’t need the train driver at all.
How are agencies responding?
In a rapidly changing landscape, how have the agencies been responding? They broadly fall into one of three buckets:
The first category is the “wait and see” camp. They simply continue doing what they’ve always done, grinding harder to win their slice of those same diminishing budgets. It’s a zero sum game that has begun to claim its fair share of victims.
In the second category, we see many of the big 6 agency holding companies opting for consolidation as their first port of call. Just look at WPP’s massive consolidation of agency brands and teams across the globe - they know the industry is becoming commoditised and that streamlining their operations via mergers is a key lever to stay competitive. It’s not a bad strategic option for publicly traded multinational holding companies with deep pockets. But it’s a temporary fix, and it’s simply not viable for most smaller agency groups.
In the final group, we see some of the more proactive agencies making a decision to diversify. We’ve seen agencies launching consulting offerings, broadening their capabilities into project management, Customer Experience, service design and even moving into the ventures space.
Out of the three options, it is this final group that’s the most interesting. Rather than waiting for fate to decide the outcome for them, they are proactively making changes to their business model and operations in order to evolve and adapt to the changing landscape.
How can agencies move up the food chain?
To paraphrase the great ad man Don Draper: “If you don’t like what’s being said, change the conversation”
Challenging the brief is an age old tradition for agencies. The trouble with this approach is that the client has a job that needs doing, and simply changing the brief at the final stages of execution may not be possible given they have committed to annual plans, KPIs and budget allocations. In order for this approach to work, agencies need to move up the metaphorical food chain to inject this input at a point where it can realistically be implemented.
So an important step might be simply changing with whom you’re having the conversation. Because agencies have traditionally responded to marketing briefs, they tend to remain pigeonholed in the lane of the CMO. And yet, I would argue that given the chance, the types of skill sets and capabilities prevalent in many leading agencies would be well placed to solve problem statements across the entire C-suite.
The key to access these opportunities is to develop an offering that can open the door to new executive stakeholders at the client organisation.
We didn’t originally design 5 Ways to Innovate to help agencies expand their service offering, but over the last few years we’ve actually found that when they use our Innovation Health Check as a conversation starter, it not only opens the door to new executives within the client organisation, but gives them access to new types of briefs. In the best cases, we’ve seen the health check lead to agencies delivering our innovation assessment workshop, which by design generates three new briefs to help the client build effective innovation systems. In these cases, corporate innovation has acted as the catalyst to claim the agency’s seat at the grownup’s table.
And of course, innovation isn’t the only offering that achieves this effect. Many boutique agencies have successfully used capabilities like proposition design, lean startup or design thinking to extend their influence and generate work across a broader set of the C-suite. By borrowing a proven 3rd party system to diversify their offering, we've seen many independent agencies successfully change the conversation from simply receiving or challenging briefs to actually writing them.
What do you think - are agencies doing enough to evolve their service offering within the changing ecosystem? Are their creative capabilities well suited to solving problems across the rest of the C-suite? Or should they stay in their marketing lane and let the consultants do the grownup’s work?
