Former Havas chief David Jones on why the agency model will become 'obsolete'
As brands and agencies adjust to the impact of technology on their business models, You & Mr Jones founder and former Havas chief David Jones believes it will deliver brand communication better, faster and cheaper.
David Jones is a believer in what he calls ‘people-powered marketing’. He has to be; it’s one of the fundamental principles of You and Mr Jones, his ‘brand tech’ group set up last year with a war chest of £220m to sit in the space between brands and technology – an alternative model to the legacy ad networks.
One of the group’s largest majority investments is people-powered content play Mofilm, through which Diageo, Emirates and PlayStation have launched work created by a global network of filmmakers. Factoring in the group’s launch of Mosaic, a distribution network, You and Mr Jones tackles the content question currently facing most brand advertisers – but subverts the traditional creative model.
Meanwhile, its recent majority stake in data player Fifty-five and a raft of minority investments in startups such as Pixlee, Gfycat and Niantic cement Jones’ principle to bring branding capabilities to technology, and vice versa. Just prior to going to press, the company announced it had acquired a majority stake in TheAmplify, a technology and data-driven influencer platform, further cementing its belief in people-powered marketing.
“The big holding companies are fantastic at brand marketing and advertising but they don’t really understand tech to the same extent. They don’t want to, because it delivers a lot of what they do much better, faster and cheaper,” says Jones. “The big tech companies are brilliant at tech but have a lower understanding of the whole brand piece. Sitting in the middle, you’ve got the big brands saying ‘it’s all changed – we need help’.”
Such was the impetus for the company, whose setup Jones uses an analogy of three circles within each other to describe; the inner circle being the company’s ability to deliver based on the companies it owns, the second its ability to deliver based on the companies it’s invested in. Its the third circle, however, that’s crucial – the ability to deliver based on working with anyone. “95 per cent of the work we do will be that third circle; working with anyone.”
The obvious benefit of such a model is cost-saving; Jones cites one example of a recent project created by Mofilm and Mosaic for Emirates, using drones. “10 years ago it would have cost £20m to shoot something like that.”
Instead, technology has enabled anyone and everyone with a smartphone to be a filmmaker. While that ubiquity doesn’t necessarily translate to quality, Jones believes that a people-centric approach will become more prudent for brands.
All of which begs the question: where do agencies sit in this new world? Is the standard model fit for purpose? As former chief executive of Havas, Jones is fluent in agency modes of thinking, but he is of the view that the model will become “obsolete” in time, given agency structures, particularly those of the big global networks, are process-driven and often slow to adapt. Clients, he insists, while happy to pay for a big idea, are loathe to pay for 15,000 agency staff around the world.
“What ad agencies do, which is to deliver brilliant creativity, is more important than it’s ever been in a world where you can’t buy attention; you have to earn it. But the system and model through which it is delivered will become fundamentally obsolete.”
There’s still an important need for the most forward-thinking of agencies, however, he says. “If you’re in the agency world, if you’re a Droga or a Wieden, there’s the most enormous need for you because you have lots of brilliant creative people who can still create better content than the billion people out there in the crowd.”
Despite that, he believes people-powered content is surpassing most of the output of creative agencies: “Do I think people-powered marketing is going to be better than the absolute best people working in the ad industry? No. Do I think it’s better than 95 per cent of the work that comes out of the ad industry? Yes, absolutely.”
Jones underpins his rationale for investment by claiming he can offer something others can’t – by combining capital with strategic value for startups. The options available for a company looking to grow today, he asserts, are either private equity venture capital, which offers “no strategic added value,” or a strategic deal by selling to a global ad network like WPP or management consultancies such as Accenture. While these offer strategic benefits, “you become a tiny tiny dot within a very big organisation,” he argues.
Sitting at the centre of You and Mr Jones is Blood, a consultancy arm run by former
R/GA duo Drew Burdon and George Prest and established to help clients navigate the group – “it’s kind of our operating system across all the different companies,” says Jones.
Though it looks suspiciously like an agency, Jones asserts it has different aspirations. The first contrast is in output – Blood does not create campaigns.
“The whole idea is to use technology and the billion people out there who can create, produce and share content to deliver solutions.” That’s as opposed to a traditional agency model of fees determined based on hours delivered per head. Instead, projects are charged based on deliverables. Unlike agencies, Blood is not looking to be on a roster; it wants to be on the P&L.
With an increasing trend towards project by project over retainer led partnerships, some in the agency world have suggested a move back towards longer term relationships would be more sustainable.
But Jones is sceptical. “I’m sure the agency world would like it to happen, just as they’d like to go back to the world of 15 per cent commissions,” he laughs. “But at the end of the day, clients get what they want, and it’s been a very long time since I’ve heard a client say ‘if only agencies had more retainers and more fees’. Clients, in my experience, are dismantling expensive retainer head hour based relationships.”
Returning to the topic of how content models have changed, he adds: “tech allows you to create, produce and share content at a speed like nothing we’ve seen historically. In that world, you’re not in a world of retainers, you’re in a world of projects.”
Networks: A thing of the past?
The growth of clients used to dictate the growth of agency businesses, with companies such as Coca-Cola opening offices in new markets and agencies following suit to serve them. What’s now happening is the opposite, according to Jones – a situation where work can be delivered globally without the need for hundreds of agency offices worldwide.
“20 years ago, global brands probably needed 300 different pieces of advertising for 300 markets around the world. Producing that advertising was expensive, analogue and slow, and you needed a big ad agency network with 300 offices to run that. Today, pretty much every brand is running the same work globally. Anything that’s on Facebook or SnapChat is global. You no longer need 300 offices around the world.”
Whether Jones’ vision of tech and brand utopia will have the impact he predicts is yet to be seen. But the wheels of change are in motion regardless; old modes of working will need to adapt to fit a world where attention can no longer be bought. If the promise of tech is delivering brands to people better, faster and cheaper, why wouldn’t they?
This feature was first published in The Drum's 4 May issue.
Content created with:
The Brandtech Group
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