The Future Of Agencies, According To GumGum VP Jon Stubley

In this opinion piece from Jon Stubley, VP ANZ of visual marketing agency GumGum, gives us his glimpse into the agency-land crystal ball to suss out what the future looks like.

The rapid advances in technology and data capabilities of the last few years have transformed the way brands are structuring their marketing departments.

The proliferation of channels and the rise of data and technologically driven marketing mean that brands are now hiring talent who are adept at technology, programmatic advertising, content production, channel analytics, plus a host of other skills.

Teams are multi-disciplined (the days of the silo are pretty much over) and today’s CMO has to have at least a working knowledge of all areas of the marketing ecosystem in order to move swiftly and in real time when both opportunities and problems present themselves.

All this begs the question – is there still a role for media agency and technology partners and how will those relationships change as brands bring specialised skills in house?

To find out my own company, with Brand Innovators, surveyed 240 digital marketers at Fortune 500 companies in the U.S. in February and March of this year. Whilst all the marketers were US-based only, the results reflect conversations that we are having in market here in Australia with brands and agencies of all sizes.

And this is what was learned:

Partnerships won’t go away

For agencies and vendors worried about long-term viability, we have good news to report: 33 per cent of marketers anticipate an expanded role for their agencies and vendors over time. The reason for greater reliance on vendors?

Many of the marketers (43 per cent) predict an uptick in work for organizations that have been slow to adopt digital technology, so there is a need to catch up. A network of outside experts will help these digital laggards do just that.

Around 20 per cent predict they won’t make any significant changes in the way they work with vendors. But there will be some pain for vendors: 31 per cent of marketers expect a diminished role for outside vendors, although only 15 per cent say that will affect their relationships with agencies.

In-house vs. outsourcing: a constant discussion

One in three marketers say their organisations are actively re-evaluating how to work with partners. Clearly, marketers feel that some functions are best left to outside exports, while others can be brought in-house to reduce expenses.

“We are always evaluating what we should take in-house and what we should outsource to trusted partners, and over the years this has evolved a lot,” noted a VP at a well-known sports brand.

“We are much more likely today to take on functions in-house than outsource, especially if they are tactical, bread-and-butter functions like content generation or SEM.”

How to be a good partner

Although we didn’t ask our survey takers what it would take for them to continue relationships with their vendors, it’s not hard to read the writing on the walls. Brands clearly want to bring more bread-and-butter functions in-house, so vendors who help them do that will strengthen their relationships with the brands.

In other words, vendors that engage in knowledge transfer will be perceived as helpful and trusted advisors.

Good news/bad news

The good news for agencies and vendors though is that the pace of technological change isn’t slowing down. This means that brands will always need help in keeping up with their customers and prospects as consumers are quick to adopt new channels and devices.

Consequently, the best way to secure a place at the table going forward is by helping brands to adapt to what is new.

The bad news for some (although I believe a win/win as it will weed out the – dare I say it – snake oil salesmen) is that brands are much better placed to take on previously outsourced capabilities and are building their expert in-house knowledge faster than ever before so there will be no room for anyone that provides poor and indemonstrable value.

Just good enough is no longer enough. In our brave new world only those who provide exceptional and demonstrable value will prosper.

The entire report – Building the Marketing Organisation of the Future – can be found here.