I’ve had a bit of time on my hands recently (I quit my job). This has meant a lot of opportunity to read lots of articles about the current state of the advertising nation (I’ll leave it up to you to decide if that’s a treat or forfeit.)
It seems from the majority of articles I’ve read that the industry is in a bit of trouble. If one were to believe the more extreme examples then we’re in a cataclysmic, apocalyptic terminal decline that will only end when the world of communications is entirely commanded by two-second blipverts programmatically delivered by one (max: two) digital platforms.
But like most of the binary arguments currently being pedaled on LinkedIn that is, of course, total toilet. I’m getting a bit sick of the ‘death of’ vs. ‘future is’ narrative if I’m honest.
But what is clear is that the creative industries – and the advertising industry especially – is facing some hefty challenges. And from reading 1001 articles over the last fortnight I would say that these tend to come in two forms.
The first we face is the Bottom Up challenge. All the stuff we used to make money on – adaptation, activation, production, and account admin – is all being commoditised. It’s no longer something that a client needs an agency to do. Therefore we are seeing two trends emerge. 1) The shift to in-housing. It makes no sense to outsource something to an expensive third party that you can do just as easily yourself 2) The ever reducing margins made by agencies on things that used to be the balance sheet ‘reliables’ through which you could invest in new talent, new technologies and ahead of growth. So the bottom up challenge is an issue.
But IMHO the bigger long-term threat is the Top Down issue. Agencies are increasingly simply no longer involved (or even invited to) the proper grown-up discussions within a clients business. Marketing has always tended to be seen as a cost vs. a revenue generation exercise. It’s not getting any better. The ad agency not being involved in the big chats is one symptom of marketing’s continued (increasing?) exclusion from boardrooms. So who is the CEO having these conversations with if it’s not their agency? Increasingly, it seems to be the consultants. This is a much bigger threat than losing a few shekels on retouching or data collection/management.
Management consultants have always been liked by CEOs. In my time as a client I noticed that the top bods always liked McKinsey because they were the only people they were allowed to admit that they didn’t know all the answers in front of! Consultancies tend to not be wedded to one solution so feel less suspicious to senior bosses. But importantly management consultants have credibility at board level because they know the language and numbers of business. Agencies quite often don’t these days and that leaves them vulnerable to the challenge. In the immediate term, this isn’t a terminal issue for agencies because no consultant has got even close to cracking any sort of decent creative solution, but it might not be too far away.
So, my contention is that the biggest issue we face as an industry is that we are just not having big conversations. So, therefore, we are not being asked the big questions. Therefore we aren’t involved in coming up with big answers. Unfortunately, there is not a lot of money or differentiation to be found in the little answers to the little questions. So why has this happened?
We’ve become obsessed with the minutiae: We used to care about the big problems and the big challenges. Now we often get mired in the lickle stuff and the day-to-day admin tasks. A top CMO recently said to me: “Forget your tech-stack. Show me your brains.”
We’ve become obsessed with ‘new and young’, at the expense of ‘right & experienced’: I love technology, but it is rarely the answer. It is a facilitator or amplifier of an answer. And senior business bods like experience and proven thinkers/doers, which tends to mean you’ve been about a bit. Just being older doesn’t mean inflexible. I love Cindy Gallop’s recent #sayyourage initiative.
Companies like McKinsey and Accenture really sell on experience.
We’ve become internally obsessed: Take a look at most agency (big and small, network and independent) websites. They tend to be so internally obsessed, especially with supposedly proprietary models or approaches. Clients want to know that you care about their business, not your own. David Ogilvy totally understood this. Read up on what he said on it.
We’ve become obsessed with the industry battle not the wider business war: There is nothing more boring than listening to someone wang on about what they care about and you don’t. I think possibly only the fashion industry beats the ad industry for self-referential self-obsession.
So all this recent reading has made me come to one conclusion. If we are going to avoid to Bottom Up issue and meet the Top Down challenge then we have to start getting back to having big conversations.
Pretty much anyone can adapt something, or print something, or organise something or be a physical presence in a meeting or on a conference call. But not many people can be the real problem solver, the trusted advisor or the go-to person who gets you unstuck. A few years back the people like David Ogilvy or David Abbott or MT Rainey or Frank Lowe were the people the client would turn to first if they wanted a meaty problem solved.
I think the next generation of agencies and agency leaders need to get back to being able to have those big conversations if we are to fight off the technologists or technocrats.
As that CMO said to me recently: “I don’t care about workings out. All I want to know is - are you the brains I want in the room when the shit hits the fan?”
Kevin Chesters is the incoming partner/CSO of The Harbour Collective