Roth Observatory International attended the 2015 New York AdForum summit which gathers around 25 marketing management consultants from all around the world every year, and provides the opportunity to meet with key stakeholders across the Communications industry.
These sessions provide the opportunity to gain a deeper knowledge of agencies and an overview of the industry’s key trends globally.
This year the summit mainly focused on creative agencies: 8 networks, 7 independent, plus 6 global digital and CRM offerings; and met with Interpublic CEO Michael Roth, as well as David Jones (Havas ex-CEO) and founder of You&Mister Jones a 'Brand Tech Company'.
The hot topic was: the reinvention of the communication agencies industry.
Agencies are starting to evolve under the pressure of a broader competitive landscape
As technology-enabled processes grow exponentially, marketing departments need to adapt to gain deeper consumer knowledge, faster and more innovative product and services development, as well as more targeted communications. Clients dramatically need support to conduct change in their business, opening new opportunities for different types of stakeholders in the market.
Meanwhile, the agency competitive landscape has significantly evolved over recent years, with 'Everyone doing the job of everyone' becoming the trend.
Different agency types are competing against one another: PR agencies, digital agencies and media agencies are selling the same content and media capacities to clients. Management Consultancies are going to clients with business transformation propositions, coupled with operational capacity. Media owners are also going directly to clients, as relationships with media agencies become less and less exclusive.
Some major media groups have created agencies to enable better access to both content and media.
And finally, Martech companies are working directly with the client fraternity as brands internalise specific functions (CRM, Content distribution etc.).
Challenged on every dimension of their offering (strategy, creation, production, contact planning and media buying), traditional agencies have been forced to restructure their offering.
Agencies are simplifying their offering, re-bundling the agency model
Putting stories together, being able to create an environment fostering creativity is one key differentiator for agencies.
In terms of skillsets, they are tending to simplify their offering and re-structuring around three key pillars: reputation, content, digital.
'Clients want better, faster, cheaper' so in order to deliver expectations, agencies are starting to rethink their organisational structures and ways of working.
Many of the creative agencies we met during AdForum have integrated media/contact planning into their organisations. And as digital comms becomes fully integrated within most creative agencies, it is no longer the differentiator it once was.
On the other hand, digital pure-play agencies ae moving away from just digital communications to develop product innovation and business transformation offerings.
Actions speak better than words: agencies implement new ways of working with their clients
Most agencies are getting rid of the linear creative process to bring more added value and are asking their clients to team with them.
Some of them reposition the relationship at CEO level to get more from the strategic process to generate best in class ideas.
Teaming with clients to also produce content allows a greater speed of action. For example, one Agency had their client’s lawyers in the room during the Superbowl, in order to allow (legally-approved) live interaction with the audience on social networks.
Moneywise, some agencies are trying to move away from the old “remuneration by the hour” model, judged as a source of inefficiency, and basing remuneration on a sales-related basis.
Influenced by their Silicon Valley clients, and under high competitive pressure, agencies have started to revise their offering in order to be more entrepreneurial and agile.
This positive shift will be for the benefit of clients, provided they can rebuild trust…
This review was by the Roth Observatory follow them @roth_observ
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