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ENGULFED IN CHANGE, TOP MARKETING EXECS SEEK GUIDANCE

Digital Technologies Have 'Reframed' The Media and Marketing Business

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Nancy Smith, VP-global media and sponsorship marketing, American Express.
John Partilla, president-global marketing, Time Warner.
Robert Greenberg, Chairman-CEO and chief creative officer, R/GA.
PHOENIX (AdAge.com) -- If there is any single word that seems captures the overall focus and concern of those who have gathered at the Association of National Advertisers conference, the word is "change." At official functions as well as in myriad casual discussions throughout the corridors, lounges and poolsides here, the talk is fueled by a communal acknowledgement that the industry is in the grips of historically profound upheaval.

Visceral reaction
That many not sound like real news, but there is clearly a much deeper visceral reaction to the full scope and implications of the fact among this year's ANA crowd.

A curious mix of frustration and excitment is echoed throughout the video interviews that Advertising Age Editor Scott Donaton continues to conduct among participants on this issue.

"There has been such a change in consumer dynamics," said Nancy Smith, vice president of global media and sponsorship marketing for American Express. "The challenge is actually to find new ways of communicating."

'Instruction and education'
Ms. Smith emphasized that she has never seen a gathering of such high level marketing executives who are so openly "looking for instruction and education" about what the marketing and media changes mean. The problem facing their companies, she said, isn't about the need for incremental adjustments or refocusing their marketing-communications programs but rather about the need to totally reinvent those programs.

John Partilla, president for global marketing at Time Warner, pointed out that the ongoing impact of digital technologies and video on demand was "reframed" the entire media business.

What marketers are looking for now, he said, are new methods of being creative for consumers who now live in a blizzard of daily media streams. "[Big marketers] are now saying 'we can cost cut a certain amount, we can acquire properties a certain amount, we can look for ways to drive our efficiencies in our media relationships,' but what we're ultimately all looking for is top-line growth. The only way to get to top-line growth is to be much more innovative with media assets. Marketers wants more creative ways to reach consumers."

Impact on big ad agencies
And while it might seem that such sentiment bodes well for the sprawling networks of holding-company advertising agencies, Robert Greenberg, CEO and chief creative officer of interactive agency R/GA, says that isn't so because the old agencies and old agencies business model continues to corrode.

"Everything that I look at about the business is being challenged now," he said. "It's going to be much easier for new creative shops and companies designed from scratch [to succeed in winning large marketers' work]."

"I think it is very difficult for a large agency to be a one-stop shop any longer, like an Ogilvy or JWT," Mr. Greenberg continued. "All the other new business models we see emerging are slowly eating away [at the traditional agency model]. You also have the client-managed model in which the marketer goes out and gets the best-in-class smaller companies for the specific marketing-communications services needed."

Small and nimble
He indicated that small-agency entreprenuers who had been squeezed out by two decades of consolidations now continued to gain new power because they were small and nimble.

"Even the benefit of having multiple agency offices is going to go away," he predicted, " because there will be more small boutiques that do localization, translation and implementation for so much cheaper."

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