I love The Lord of the Rings, but it often brings to mind the decline of the traditional creative agency model.
Ian Priest (Is he The Return of the King? Is he Frodo?) in his admirable ADAPT programme has repeatedly pointed out ‘one sector that needs more creativity than most is the creative sector itself’.
I think it needs something else as well.
What it really needs is a better creative strategy.
If the ad agency were a product in a supermarket it would be experiencing lots of problems - smaller facings, falling rate of sale, ageing core audience, price offers, disloyalty from increasingly portfolio consumers etc etc etc.
You don’t have to do much of a Porter’s Five Forces analysis to get why the profitability of the ad business is in the toilet.
So what’s wrong with the agency model?There’s your problem. Agency.
Whatever the business sector clients pay agencies to do things they cannot (or don’t want to) do themselves, it pre supposes the agent knows how to do it (doesn’t have to get some other ‘agent’ to do it for them).
Let’s start with the buyer power problem. Agencies have done such a good job of making brands important to businesses that businesses will now no longer trust them to their agencies. The best brand clients employ ex-agency people to run their agencies so they need agencies less.
New entrants. Clients typically want agencies to do so many different things in support of a modern brand that almost no single agency can do them all and this skills fragmentation is hitting the mid sized agencies hardest.
Substitutes. Advertising was built on an interruption model within broadcast media. We live in a search driven world that requires magnetic content. I think the word I am looking for is… Google.
Suppliers. Well, suppliers haven’t been so much the problem but, as Tesco have found, the more agencies look for better value from suppliers the more suppliers look to disintermediate the agencies.
And finally, Rivalry. All of this has created a level of competitive rivalry which is undermining the ability of the companies to charge, fragmenting the industry and increasing the power of buyers - and so it goes on.
So in a market with extremely challenged structural profitability, you need to be very precise about what you are seeking to get paid for and make profit from.
Clients don’t need 'agents' for ‘creativity' any more. That is not to say they don’t need creativity. They just don’t need or want the 'agency' approach to delivery.
Too many people in creative agencies are agents and not enough are creative.
So what do clients need? Who do they really want to pay? They want to pay people - let’s call them creative consultants (like in a hospital) who can do the ‘creative’ things they can't do themselves.
Let’s leave aside access to media and channels because that part of the industry was separated long ago. (The 'media is creative too' debate doesn’t concern us here directly)
To begin then, clients clearly need creative expression and execution skill. Anyone who can’t draw knows they can’t draw. Increasingly creative expression and execution is multi-skilled, technology sensitive and therefore rapidly changing.
We have yet to see a new marketing creativity model emerge beyond art director/copy writer but if YouTube and Instagram are the media then the 'content creative' will be the answer. Clients will always want to pay for this. The issue is, how much?
Now, in addition to the creative skills that clients inevitably lack, they also inevitably lack consumer perspective skills. You only need to think of the music publishing industry who forgot that CD buyers of all shapes and loyalties were in fact music listeners who didn’t give a shit about CDs.
It is basic psychology that if you have a hammer, everything looks pretty much like some form of nail. So clients will always need suppliers who will understand the customer world in macro and micro, now and in the future, better than they do from their own current vantage point.
So clients need consumer strategists to help them stay agile in this ever changing landscape. But not just strategists, because they could get those from McKinsey, they need creative strategists who can work with the creatives to turn consumer brand strategy into differentiating, exciting brand creativity.
And equally importantly, the creative industries need to recognise the need for creative strategy. Otherwise they will be selling a fragmented creative commodity that the client will be tempted to buy like one. The creative strategy confers value and longevity and, thereby, profitability on the creative product.
You might be thinking, 'Have I really read this article to re-discover Planning'?
Yes and no.
I wish creative agencies would rediscover it as it is one of the disciplines that has suffered from greatest underinvestment in recent years but, more importantly, I think we should dump the name Planning in favour of Creative Strategy because creative strategy is what clients know they need and feel they want.
All modern brands need creativity that is strategic and all modern businesses need a strategy that is creative.
So the future of creative consultancy is not just the creativity, it is the Creative Strategy that goes around it.
To me that is the single biggest ADAPTation we need - not faster hands, more limbs or bigger bodies but more powerful, more agile strategic brains. It’s worked before.
Paul Simonet is Creative Strategy Director at Imagination. His is an eclectic journey from Oxford English Degree and planner on Guinness, to MBA and raising £10m to launch a successful dotcom. He combined agency roles like Global Strategy Director for team HSBC with entrepreneurial ventures like a creative crowdsourcing agency and celebrity social media business.
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Last updated 13/10/2014