Archive for March, 2009
I had an interesting conversation recently where an executive from a regional media company said that advertising agencies are doomed. Knowing my biases he apparently felt like he had a receptive audience, so he explained his thinking.
Advertising agencies, he said, basically offer two services. First, they buy media. But that function had been shifted into large specialist media buying companies who were competing on price, so that revenue was gone.
What was left, he said, was the creative function. However, as his own media organisation was in the midst of forging a creative unit that would do the creative work for free as a part of an ad buy, he felt he had seen the future. How could advertising agencies survive, he said, charging clients for creative that the media companies were ready to give away for free?
Leave aside for a moment his simplistic view of the advertising business, and the fact that he was biased in favor of his own vision as it served his own purposes. (And leave aside my own self-interested bias against advertising as a marketing tool.)
The guy does make a point worth considering. Some forward thinking media are already starting to think more like advertising agencies, and as they do that they exploit a misperception among many of the less-sophisticated clients that ad agencies offer little value beyond media placement and creative ideas.
At the same time, it is too early to write off agencies. Too many media salespeople (especially here in China) operate under the implicit perception that their medium sells itself. This applies not only to TV, but to online outlets as well (major portals selling ads based on time rather than a more meaningful measure? Please…)
For the media to become a genuine threat to ad agencies, the ad sales and business development people working for media need to think more like account reps - knowing all that they can about the client’s business, then rethinking what they offer to help the client make really creative use of the media outlet to advance their business goals.
And I mean going beyond positioning the buy to a point where you completely rethink what you are selling. Is this opportunity really about selling banners or postage stamps, or is it about getting the client to sponsor an entire section of your site and even support specific content? Are you willing to toss your business model out the window to attract a great advertiser?
Because if you aren’t, you are not ready to replace either the ad agency or the client’s CMO.
Tags: Advertising, agencies
Posted in Advertising | 3 Comments »
