Agencies and the death of legacy thinking (2/4)...(continued from last post)

Hello again! And for those of you who have just joined us, Hello!

Before I elaborate on my thoughts here, a quick recap – last time our conversation was all about how marketing has changed in the new world and how we as marketers need to change to keep pace. Newcomers, you can read all about it here. This time, I’ll take my thoughts a little further. All is not what it was in this marketing world of ours. As marketers, we need to first accept that the 3 pillars of marketing have changed to reflect – content, creative and technology. In that context, let’s bring the agency into the gambit. Yes, the agency, the ones we are so familiar with and increasingly seem to consider lagging with respect to our expectations. This is not a personal opinion. Rather, one that seems to be the prevalent concern cropping up in many of my conversations with other marketing leaders over the recent past.

Remember my caffeine loving friend from the last post? Like I said, he was on his way to Singapore to shop for an agency. Not just any old one. But a new-age one, well that’s the way he put it. It seems that traditional agencies are not cutting it any more. In a survey conducted by Avidan Strategies, it was found that 62% of clients view their marketing agencies as a supplier and not as a partner. Moreover, 73% felt their agencies were incapable of generating genuine customer insights.  The need is for an agency that understands the changing dynamics of the times and acts accordingly to best serve the marketing process. And this requires an essential change in thinking, not just a change in working.

  The erstwhile agency model was fundamentally geared to be reactive, not preemptive. Today, there’s no longer any time for that. We live in a world where brand fortunes can change at the share of a Tweet. One unglamorous Tweet can erode a painstakingly built bank of goodwill under a deluge of similar unflattering Tweets. Agencies must anticipate problems before they happen or at most, as they happen. But it’s not all about problems. The same can be said for changes in consumption patterns, trends, conversations and what have you. It’s a little like being a surfer. One must watch the water, recognize the perfect wave before it forms and then ride it to its spectacular conclusion. Here, I would like to make a confession. The surfer example is more what I have learned while on some boisterous lounging on the beaches of Florida than what comes from experience. Personally, the closest I come to surfing is when I open my laptop.

The secret to this preempting, as turns out, is no secret at all. Every senior marketing leader I have spoken to seems to know of it. Legacy agency proponents however, seem not to be listening. The open secret lies in the use of analytics. Thanks to the technology and tools at our disposable currently, data mining has never been so intensive or easy. But gathering data is just part of the process. The ability to sift the data for genuine consumer insights is where the magic lies. It is not enough to just say that consumers behave in a certain way. The need of the hour is to analyze data to preempt the consumers’ reactions to various stimuli and tap the processes that make them act in the manner we want them to act. The role of business analytics can also help solve one of the biggest issues facing us as marketers and consequently the agencies of today – RoI. Nowadays increasingly, spend justification depends on a clear indication of expected RoI. Not just campaign effectiveness, but the very act of spending on an agency depends on the latter’s ability to present a convincing showcase that the money invested will translate into measurable returns, be it as insights, consumer actions, more effective communication strategies or something else. Still, agencies seem reluctant to wake up to the need for analytics driven functioning.

  This reluctance to adopt and adapt to the new way reminds me of a dinner conversation with the owner of a global chain of fusion restaurants. “People mostly”, he said over bites of something that looked suspiciously like a marriage between a pasta and a fiery red curry, “are used to having their food in the manner they always have, they don’t really think to try out something different, to experiment. This opportunity was just there for the taking. I did nothing new, just what others thought not to do!” This I think is quite an apt way of explaining the agency mindset of today. So involved are they with their processes that they find it difficult to break away from them and create something truly seamless and agile enough to match free flowing marketing needs. The reluctance seems to stretch out from the work and the way to work, to something as critical as revenue models. The old order of charging by man-hours needs replacing by something that is much more flexible and which can be made to work for both the agency and their clients. Should they be looking at business models that rewards them for meeting marketing KPPs?

  Now, like I said before in my last post. This does not mean that agencies should lose focus of how best to package a message. They can’t. The ability to connect with consumers in a manner that is the least explicit and the most interesting should always be one of the integral areas of focus for any player who aims to create a substantial marketing impact. But, this can no longer be the only benefit they bring to the table. Unless of course they have made a conscious choice to be a boutique specializing in just that. And then too an understanding of the use of creativity based on consumer behavior is essential. Today people no longer consume communication in the manner they did even a few years ago. The age of native advertising and inclusive experiences is upon us and agencies must realign creativity to cater to the times they live in. There is an urgent need to shift the focus from messaging to storytelling, and compelling ones at that.

  So, what should agencies be doing? How can they change the game, so to speak, for themselves? And be relevant in these times and those to come. In short, what steps should an agency take to transform itself into a true Agency of the Future. There are no easy answers here. Sure, they seem easy enough, but knowing is sometimes a lot easier than doing. Mostly it has to do with complacency, but it also depends on getting the vision right. In the ever-changing scenario of today we are just about beginning to understand the role of new age thinking like IoT, block chain technologies, big data & AI, to name but a few. There are no clearly defined answers on how these technologies and tools will help the marketing process of the future and how best agencies can tap into them to become the true partners of tomorrow that we would like them to be.

   Let’s take a pause here for the time being. When we meet next, I’ll delve a little deeper into trying to find these answers based on my experiences and interactions, till then let’s enjoy the excitement of our times!