Confused about the advertising industry? Who isn’t?
Wondering what’s going on with holding companies, advertisers and consulting firms? TrinityP3’s Michael Farmer is here to cast his eye over the confusing state of affairs.
Holding company shares are falling. Their ad agencies are shrinking, with low morale, low salaries and hiring freezes. Accenture and Deloitte are the new, growing competitors. Advertisers are cutting spend but investing in-house. Chief creative officers are disappearing, not entirely due to sexual harassment charges.
Confused by some or all of this? Read on!
1) What’s going on with the holding companies?
Holding companies are entering the third phase of their strategic development.
Great read Michael, as someone who is relatively new to the industry its interesting to see how things have progressed over the years.
On point 3 though I think it’s fair that digital SOW have increased as the cost and, more importantly, time of production is far lower. Sure the creative idea still takes time but pumping out 100 ad units now is far, far easier than 10, 5 even 2 years ago.
Speed is good, yes.
But is the quality any better?
Is it helping brands grow significantly?
Michael addresses this in point 2:
“The net result: brand growth ceased, and digital/social spend did not provide a solution. CMOs lost credibility and their job security declined to three-four years.”
Sadly the race is to the bottom.
Michael Farmer has delivered a powerful message to agency management. An aspect not touched on in recent years is the vital importance of a highly skilled and experienced strategic planner with the ability to deliver valuable marketing consultancy, thus obviating any necessity to partner with a management [marketing] consultancy. This style of operator is extremely rare and past advertiser managers have strongly endorsed the skilled role as extremely valuable.
Making your point brilliantly, I believe “horizontality” got canned today. ‘not sure if this is because it’s a poor idea or because it’s an unforgivable abuse of the English language.
I am not sure that agency strategy planners negate the need for management consultancies.
There is a huge range of planners in the real world.
Some planners are numerate and ground their analysis and recommendations with a data point of view. Not audience numbers but financial, a category of data not often shared with agencies.
(Would any client trust their agency with their accounting & spreadsheets. Do agency planners even know how to direct the columns?)
Other planners are grounded with experience in operations and systems redesign or operational planning.
That may require a bottom-up study and through-the-line breakdown of a business from supply chain to distribution margins.
On the other side, agency planners are hired for their ability to simplify communications plans, create media strategies and engage creative directors.
In fact, we give out senior planning director titles based on their ability to write award winning case-studies.
These agency planners can barely hold a conversation or suppress their boredom when talking to clients (let alone) add value to entire business spectrums.
That’s where the top dollar mgt consultancies excel in.
Until agencies hire the kind of planners clients respect and gladly pay for, agencies will never be trusted to sit next to the driver.
Modern businesses require a whole tool kit of different tools.
Agencies have a tool kit with just one tool albeit plated in different shades of gold, silver and bronze.
Truth bomb: It’s still the same tool.