Wednesday, July 20, 2011

Reflections on a Decade in Advertising: Part 2

In the first part of my rant/reflection/ramble, I laid out what I think is a big problem with the ad agency business model, and promised some potential solutions in this post. Then I spent the next week or so panicking about my complete lack of answers to a problem many smarter people than me have failed to solve. I did have a few initial, sketchy ideas that I hoped would take me somewhere:

1) Create autonomous groups of people to take on the new media world outside of the main organization (I covered off on this briefly in the last post)

2) Experiment on yourself

3) Re-imagine what market research should be

4) Think relationship before reach (unless your product stinks)

5) Sell the audience along with the creative

Let me start by saying that I've given a bit more thought to idea 1, and I think there may be something more important that just creating a skunkworks-type group at some remove from regular agency operations, and that is to create competition. If I were running an agency, I'd want 2-3 groups assigned to selling and implementing digital and social campaigns to existing accounts. I would compare performance and provide additional scale to the group that did this best. I think this would work because ad agency folks, especially on the account side, are pretty competitive by nature, and I think would both like to best their colleagues in something like this, and would be incentivized by the financial rewards for getting it right. But whatever approach agencies take to building a stable business model around digital communications, let me just repeat that expecting the whole shop to be cajoled into becoming digital experts might be like expecting to turn a freighter on a dime.

So on to my second idea, which is inspired by my brother and his penchant for tattooing. When I asked him how he decides who to trust to tattoo him, he said, "I'd never let anyone do it until I saw the ink he put on his own body." If you want a client to trust you with their brand's reputation in this hypersocial world, prove your skills are solid by applying them to yourself, and your agency's brand. I give my old shop, CDM, credit here, since they were willing to dive into the social platforms. But I'd suggest agencies should go a lot farther, and view digital and social tools as one of their top tools for lead generation and relationship building.

My third point is that market research should be fundamentally reimagined, and it is a point near and dear to my heart. Market research is often treated as some hermetically sealed clean room where every variable must be controlled. But this makes market research essentially sterile and detached, bearing little resemblance to the messy, complex, fast-changing digital world we now have to work in. So instead of doing focus-group-facility, behind the glass market research, develop pilots to test ideas in the real world, or conduct intimate tracking research with a smaller number of subjects. Do anything to get into the real world and figure out how people actually use, think about, talk about and share your brands. Remember, the program might be the idea, so you need to have a clearer picture of how people are actually going to interact with that idea.

What do I mean about 'relationships before reach'? Simply put, that the number of people who saw your ad is no longer the standard for evaluating success. A campaign should be winning over converts, true believers who will help advocate for your brand. If you have a great product, this is very doable. Just create the story of why your product can improve your customers' lives, put the product in their hands, and watch the fireworks. (Easier said than done, I know.) But if your product stinks, or is only mediocre, your efforts to build a relationship will backfire, because your customer will resent you trying to force them to have a relationship with a product they dislike. If you're selling some me-too piece of garbage, then forget what I said and go for reach.

Lastly, I have a bit of an out-there thought that I nevertheless think might help many agencies thrive in the new advertising ecosystem that is emerging. Simply put, establish independent channels to target customers that can be sold to customers. For example, my old agency was focused on marketing to health care professionals. But we had no relationship with that audience that lived outside of each client's individual campaign. What if the agency (perhaps in collaboration with others to gain a critical mass of brands) created a knowledge exchange that physicians could sign up for to get product updates, request samples, sign up to participate in upcoming trials, and simplify other interactions they want to have with pharmaceutical brands? I'd think that would be valuable for that audience and for the agency's clients, and it makes more sense for it to be done by an agency (or a group of them) than by a client, who of course has a limited roster of brands. (There are, of course, a hundred practical issues that would need to be overcome, but I don't think any are insurmountable.)

So, those are my ideas. Perhaps some or all are terrible...I have written this post in bursts over several late evenings. But my hope is that they inspire some thinking, and challenge the notion that the agency business model essentially is what it is. The new digital framework cannot be twisted and bent to fit the way agencies have grown comfortable operating. Transformation of the sort that is needed is wrenching, but crucial to the long-term survival of what is still a great industry.

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