Big agencies are walking down dark alleys. Waiting in those dark alleys are CMOs and consulting firms, and their weapon of choice is data analytics. It doesn’t look good, but there’s a chance that agencies will come out alive, though slightly reconfigured.
It’s a scenario that’s been spoken about for a while – the days of the Mad Men are over and clients want to see return on their investment – everyone knows that advertising is changing, but we wanted to find out what the future holds; Ross sat down with Spillly (yes, with 3 L’s) to find out a little bit more about what’s next for big agencies and how to build a movement by starting with your niche.
Pictures don’t sell, data does
The days of the Mad Men are over, and it’s highly unlikely we’ll see a campaign that isn’t backed by data and sound strategy, moreover a campaign that isn’t measured post-release. This is, in part, the fault of agencies themselves – we all know about the heydays of advertising – and partly an evolution of the role of CMOs and marketing managers.
Over the past ten years, marketing efforts have become more focussed on aligning with business strategy, rather than just around creating brand awareness. This means that CMOs, marketing managers, and in turn, their agencies are more accountable for the money they spend and the return on it — it means that we start and end with data, albeit with caution.
“The client is going ya, ya pretty pictures whatever. Show me the value. Show me where we converted. Show me the numbers. Show me that there’s been return.”Spillly, One More Question
Creativity and numbers have always been on opposing sides. As it stands, companies may be looking to data to ensure the highest possible return on investment, but if we only look to data, we run the risk of a brand losing its personality, the emotional connection that brings customers back. Once we lose loyalty, it becomes a race to the bottom (on price) or the need to innovate at what may be an unsustainable rate. This is the land of gimmicky “First ever” advertising with vending machines that sing, pop and fizzle in one location for one day. The output is generally a good case study video and not much else.
By now, the notion that data and creativity are adversaries is widely accepted as outdated, and some of the best CMOs in the world realise the importance of data and creativity working alongside one-another. They can (shock and horror) actually add some value to each other!
We found that marketers who are what we call “integrators”—those who have united data and creativity—grow their revenues at twice the average rate of S&P 500 companies: at least 10 percent annually versus 5 percent.McKinsey — The Most Perfect Union
If you’re looking to data to bring about actionable insights to drive creative, look no further than Netflix. To keep users coming back, Netflix needs to deliver what users are looking for as efficiently and intuitively as possible — they do this by selecting the most effective artwork, enabling subscribers to find the content they were looking for, much quicker.
Through research, Netflix found that artwork was not only the biggest influence on a subscriber’s decision to watch, but it was also where 82% of their focus was guided when they were browsing.
In order to find the most effective artwork, Netflix built an A/B test where subscribers were served a different image for the same title. Engagement rates for each image and title variant were measured, and data showed that the right artwork could widen the audience and increase engagement.
Netflix now understands how to most effectively tell a subscriber that a story is the right one for them, by using a single image. Though not as shiny or quirky as Spotify’s marriage of data and creativity, this is certainly a standout example of how best to pair the two. We see this as data giving the creative real honest feedback.
They’re not just taking our lunch money – they’re putting us in the football team!
The power of data has made it more of a challenge to sell creativity alone. You need to base your creative on sound strategy and powerful insights, built off high-quality data. Clients can no longer risk beautiful craft falling flat because it isn’t based on a business goal or deep research.
Enter the consultancy. Experts in research, data, and strategy. Consultancies have been shaking up the creative industry, most recently with Accenture’s acquisition of Droga5, and it’s not a new thing — Accenture Interactive was formed 10 years ago to answer the needs of a new ilk of CMOs.
Consultancies aren’t necessarily interested in competing with agencies. Their reputation for solving business problems is superior and so are their C-Level connections – so why couldn’t they help on the marketing front? Where they fall short is in creativity, and instead of building creative departments from the ground up, they’re buying entire agencies – creativity packaged – so it’s a race from either side, consultancies to build creative departments and agencies to build departments to tackle data analytics.
Why is a very numbers-heavy-MBA kind of business buying a very creative business? Because they understand that there’s more than just the pretty picture at the end. There’s other value there.Spillly, One More Question
The need for creativity in consultancies hints at an important point – there is value in brand building, in creating emotional connections that endure, even when your brand is going through a challenging period.
Building and maintaining a strong brand is not just about putting out a great ad every few months. It’s about building a persona around your brand, finding a voice, and telling genuine stories.
Connecting with your audience in a consistent, genuine manner creates loyalty and a feeling of community. It ensures that your brand is able to compete on an emotional level, rather than trying to be the best on price alone. It also encourages support when times are tough – just as you would for someone you care about. In the end, it affects a brand’s bottom line over the long term by making it something that people can become personally invested in.
CMOs should take up the creative mantle and build differentiation and preference for their brands. Bring the brand essence into action through creative-inspired experiences and campaigns. Balance CX and brand investments to ensure the proper amounts of technology and creativity. Most of all, tap into partners who bring creative courage that can be executed at every touchpoint.Forrester — The Pendulum Swings Back to Creativity
All of this starts with a strong positioning, knowing who your brand is, who it speaks to, and how it interacts with the world around it. It stems from being able to tell a strong brand story, allowing customers to relate, support, and attach themselves to your brand. Emotive stories have an intrinsic value, and the knowledge and expertise of crafting these stories is found in agencies — consultancies know that this is where they fall short, and so are rushing to buy the biggest and best in an effort to boost their creative muscle.
Want a story that will get people out of (or into) bed? Strengthen your positioning and build a strong brand story. Ask us how.
Finding your business base
The process of building a strong business or brand isn’t just about data and big ideas – it’s also about authenticity and finding (or creating) your minimum viable market, also known as niching.
By defining your business more narrowly, you are able to find people that are passionate and loyal, and you get rid of those that don’t care. It’s polarising, but it’s also less hassle than dealing with anyone that’s not right for your brand — Rich Mulholland will tell you, you define your business by what you say no to.
Once you’ve found your niche, you need to ensure you remain authentic. Being highly-connected in a digital environment means that everything that your business says or does can be checked and rechecked in a matter of seconds. If your business puts up a facade, it runs the risk of being hated, but if it remains authentic, it stands to build a loyal following and have a better chance at success.
What people truly want today isn’t just a great service or product – it’s an experience that satisfies their soul. Consumers need experiences that are transparent, engaging, and authentic.Fabrik Brands — Are you for real?
Spillly knows all too well how niching and authenticity work hand in hand to build a movement of loyal supporters. He’s helped some of the best creative minds to solve their problems, and now he’s on a crusade to help entrepreneurs on bikes do the same
After noticing that the business coaching market had become saturated, Spillly started BBBRAP (Business, Bikes, Breakfast), which he describes as a radical business and personal coaching program aimed at the lucky few who own motorcycles.
Already a business coach and biker himself, Spillly entered the market in the most authentic way possible — by creating a unique experience for entrepreneurs to get out on their bikes, be accountable to their businesses, and meet others like them.
You’ve come from a very genuine space and you’ve come from something that’s obviously very genuine to you, and I think people realise that.Ross Drakes, One More Question
In under a year, the movement has grown, is being shared widely, and has opened up to riders in Johannesburg and Cape Town. It also helps that he knows to invest in a good photographer to capture all the moments. Some things don’t change, telling great stories to people is important.
The light at the end of a dark alley
On the other end of the consultancy-agency battle we find two burning questions. What does this mean for agencies, and more importantly, what does this mean for your business?
It is highly likely that we will see a rise in the number of consultancies and boutique agencies which stem from bigger ad agencies; in part because bigger organisations are slow to move and adapt, and at the current rate of change, small improvements just won’t cut it — keep in mind, Accenture Interactive saw current changes coming ten years ago, and now ad agencies are forced to play catch up — and it only gets quicker from here.
These consultancies and boutique agencies, unless they are standouts or very lucky, will by no means be playing in the space of the big consulting firms which have bought up big ad agencies, but will be highly skilled in their area and not interested in providing a full service offering, as this will only send them back to the current model of big agencies – trying to do everything and competing on price, which ends up hurting the client — you can read more about this in our interview with Carly Ayres.
This model will be based around strong partnerships with their clients — we’ll tell you why in a bit — and other boutique agencies. Partner agencies will also be experts in their fields, meaning that work can be referred and partnered on, without a second thought. The fact that they will be highly skilled and maintain a narrow focus will enable them to service ‘smaller’ (we use this term loosely) clients as effectively as a big consulting firm, albeit with more flexibility (as they are smaller, and quicker to move and adapt).
Communication consultancies which have spawned out of creative agencies are one of the next big trends that large brands would hopefully start engaging with more effectively.Spillly, One More Question
Consulting firms buying big agencies is less a tragedy and more a vote of confidence in creativity. Firms that are known for being experts at solving business problems are buying the biggest, most reputable agencies in the world to help them solve new problems and improve their client offering.
Remember those boutique agencies we spoke about a little earlier? In short, if you work with a talented agency — do not fire them. If you don’t have a good agency (yet), take the time to find one and build a strong working relationship. If they’re the right fit for your business, you stand to gain far more than you stand to lose.
You’re expecting your brand or communications team to sell you off your proposition but you haven’t given them line of sight of your strategy. — Ross DrakesRoss Drakes, One More Question
There is immense value in including an outside perspective on your business, especially if you are dealing with a company or agency that are experts in their field; after all, this is why consultancies exist. If you involve your agency earlier in the process, allow them to explore more, give them an inside look at your strategy, and trust them, the opportunity to apply new solutions to your business problems grows.
Got a business problem you think we could solve? Reach out.
At the very least, your agency will have a better understanding of your brand, its purpose, and how to build emotion and impact around (and from) your business’ core. The end result being a more genuine brand experience, and in turn, increased loyalty (that one thing that can carry you through tough times).
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The Nicework Team