A few macro-drivers will create huge change in 2016. The first of these is consolidation within agencies, within groups and between groups. The landscape is too busy at the moment and a degree of consolidation is inevitable.
Convergence vs Specialism – will brands buy the scale of a converged agency group or seek out the deep-specialisms of smaller players? Or will larger converged agencies need to collaborate with specialists? The question may become one of trust and how much a client feels they can get excellence in one place.
Production vs Consulting – There are already factions in the landscape in the models adopted by agencies, e.g. low margin/high volume production versus high margin/low volume consulting. Which strategy will win? Will there be one winner?
In looking back at the major agency landscape changes we saw in 2015 and making some predictions for 2016, I’ve narrowed my thoughts down to five fundamental areas: people, process, proposition, capabilities and culture.
Agencies today are fishing in a truly global pool for talent. In 2016 this trend will continue and will be further impacted by trends we see such as consolidation and growth. The continuation of this key trend is the shift in hiring talent to add specific skills and new capabilities to the agency for the next 3 to 5 years ahead.
The rulebook is truly being rewritten on this one and the first draft is still with the proofers. Change has been omnipresent in 2015 and is set to accelerate in 2016. The blurred lines between disciplines, the new ways brands engage with agencies and the pressure on margin mean that core agency offerings are evolving.
A fundamental focus for agencies in 2016 must be to focus on creativity in how engagements are approached, how teams are resourced, how relationships with brands are forged. We see a new rulebook of agency capabilities nearing a published version by the end of 2016.
In parallel to the rule book on agency capabilities is the agency process handbook that too is going through an iteration in 2015. With the rise of the ECD, data scientist, developers, and so on, the agency environment risked becoming siloed in 2015. There will be a new openness emerging in 2016 that will see greater collaboration across the agency, within groups and the creation of a network of skilled partners to aid delivery. Mobile will again be the word of the year, with programmatic and automation close behind. Whether the industry can stop talking about 'content' is anyone’s guess.
Culture is the very kernel of what makes agencies attractive to talent but also makes them attractive as a longer-term partner to brands. Agencies are beginning to see the assault of a new generation who are demanding more from work. The old structures, working frameworks, pay and reward systems are not as relevant as they once were. In 2016 an open, flexible and more mobile, connected agency will take root.
In 2015, lines have become increasingly blurred between agencies, to the extent that brands have publicly stated that understanding the landscape and which agencies offer which services has become near impossible. In 2016, a blend of culture, capabilities, people and processes must inform the agency proposition.
Gareth Moss is managing partner of The Blueprint.