Traditional holding companies continue the long-held practice of consolidation, but their track record of driving value and efficiencies can no longer address the vulnerability that lies at the heart of their proposition.
Advertising is changing, and most agencies aren’t, at least not quickly enough, or in the right ways.
One might say traditional agencies have been slow to react. It would be more accurate to suggest that they may have never seen it coming. Big TV budgets and treasure chests of hidden value go a long way to help drive shareholder value, but as digital has grown, traditional players have been caught off guard by the new demands for accountability and transparency. The limited data skills in the offline-dominated networks can no longer hold up in a world dominated by Gen Z’ers, influencers, big data, machine learning, crowdfunding and pop-ups.
A recent study stated, “72% of digital agencies worldwide say ‘data science and analysis’ are the technical skills that will be needed most two years from now.” But two years from now is five years too late.
Consumers are different, data and measurement are different, and the skills an agency needs to traverse this landscape are different. Your network planner-buyer might be whip-smart, but can she write an SQL statement, hack a 24-hour media test and attend the 9 a.m. scrum meeting with yesterday’s findings to re-write today’s priorities on the fly, without a care for an SoW?
Today’s environment requires a new type of organization and talent.
From big (media-funded) sink-or-swim creative to granular, iterative, measurable, utility-laden, ever-changing messaging
Digital and its expanding, fragmenting and siloed data sets is the new normal, and the big-picture-only thinking of yesteryear is no match for the new world of constant, iterative innovation. Sure, traditional agencies may have entire digital divisions, and they certainly drive digital media, but the skillsets and approach still refer to earlier times. Who stands up and says they’ll solve problems with a bunch of hackers?