The Future of Agencies: What Do You Think?

We’re in the process of pondering a very important question in the industry today: what is the future of agencies? Agencies have played such a crucial role in helping companies market their products and services for more than a century. Names like McCann Erickson, Young & Rubicam, J. Walter Thompson, Ogilvy, and Saatchi & Saatchi (among others) are practically household names. There’s even a massively popular and critically acclaimed television show capturing life in the golden age of legendary agencies on Madison Avenue.

Yet the agency model was built during a time when there were only a handful of channels in which they could push one way messages en masse. Does that model still work in a time when nearly a quarter of online US adults now create content online? Many more questions begin to arise as we open Pandora’s Box: Can one agency do it all? Are holding companies the answer? Can digital agencies compete with them and lead brands? Do marketers rely on agencies like they used to? Should marketers consolidate their agencies or de-centralize to dozens of agency partners? Are technology providers and crowd sourcing legitimate threats? Where is this all going?

To conduct this research we’re speaking with some of the most influential agencies, marketers, and service providers. However, what better way to get a feel for the pulse of the industry than to crowd source it? So we’re reaching out to get your take on the space. Please give us your thoughts in the comments section on the question: What is the future of agencies?

We’re looking forward to your input (and please try to keep it to one or two paragraphs)! Since this research is a collaborative report across roles, this post is cross-posted on the Marketing Leadership, Interactive Marketing, and Customer Experience team blogs.

Comments

re: The Future of Agencies: What Do You Think?

There is a future for agencies in the channels they are used to work with, but the new multichannel and two way communication will probably be reserved for the upcoming agencies that is born into this new era and a guess is that the new agencies will be smaller and more adaptiveThats my opinion

re: The Future of Agencies: What Do You Think?

A role for agencies will continue because companies rarely have (or want) the necessary resources to do all of the heavy lifting. Will they maintain their current scale? Unlikely.The pendulum will swing. Small, nimble, decentralized while things shake out. Larger and centralized during a period of eventual consolidation. Repeat.

re: The Future of Agencies: What Do You Think?

CMO's are becoming more demanding of their agencies to understand the implications of digital based channels on their brand. Agencies must build up their digital DNA to ensure they understand all engagement channels for their customers / partners. As budgets for traditional media get shifted towards digital delivery, agencies are forced to understand how their campaigns are tied directly to business results.

re: The Future of Agencies: What Do You Think?

Everybody in the mass media economy needs to rethink their value prop, and that includes agencies. Traditional media companies have already seen their business model become undermined by new media and by the free or heavily subsidized availability of information. The whole idea of "advertising" has changed, and the ability to craft brands, create opinion or generate news is also changing. Agencies won't go away, but they will need to adapt to find news ways of adding value to companies. Their ability to make money from traditional sources will be severely threatened.

re: The Future of Agencies: What Do You Think?

Agencies are in a pickle. I do agree that the multiple consumer touchpoints, or channels, compound their predicament but were not the cause. My experience (at a small agency, large digital agency, and at a publisher) is that digital agencies used to have a monopoly on actionable data - web beacons, action tags, etc. This cookie level data was the currency for targeting and for accountability. But now, smart marketers are realizing that there is a lot of data that THEY own - not cookie data on the web. Consider customer data to help target; consider lifetime value; consider online and offline activity. These are all things that exist within a marketers systems, not out there on the web. So the agency is caught saying "hey, I still have your cookie over here" but the marketer is ordering of a more complex, and powerful menu.

re: The Future of Agencies: What Do You Think?

I wanted to follow up on the topic of this article and my previous comment about the "pickle" agencies are in. I have spoken to about 20 agency execs in the US over the past few months, and here is how they seem to be aproaching their 'pickle.' http://digitalcmo.com/2009/12/09/field-notes-are-digital-agencies-bearing-the-torch-or-jumping-the-shark/