There is no doubt technology, data and automation will continue to be pivotal to agency land operations as we head into 2020 and beyond. However, the agency model of the future will see humanity, creativity, and strategy step up and take a prominent seat at the table.
Speaking in Sydney at Advertising Week, senior industry leaders from GroupM, DDB, Facebook and the Trade Desk joined to discuss what the advertising industry will look like in five years from now.
GroupM CEO Mark Lollback said: “A lot of people say media agencies will be dead, creative agencies will be dead. I’m not in that camp at all, and it’s not self-preservation. I truly believe that we have a lot to offer.”
Lollback said agencies of the future will have bigger strategy departments and a more holistic strategy partner with clients. He also predicts an acceleration into the tech world, with a proliferation of tech consulting. However, he stressed it will still need people to “pull it all together.”
“The world will go programmatic but anybody who thinks programmatic is automatic needs to come and spend a day with us and see just how much time that goes into optimising those campaigns,” he added.
DDB managing director Priya Patel said in five years’ time, agencies will still be selling creative products, but the way creative product comes to life and where it lives will change.
Patel said: “Right now everyone is talking about addressable and programmatic, but in five years’ time it will be about potentially how we make that creativity in VR or augmented reality.”
She said while creativity is still the product, the way agencies come at it will be through the lens of human beings.
“Technology is changing all the time and it will continue to change. But if you look at what human beings are like and the way human beings operate, we’re actually incredibly emotional beings. We’re quite irrational, we’re illogical and I think brands that can almost tap into that, that humanity, are going to be really successful.”
Facebook head of agency sales Ellie Rogers said that while “no one is going to win business on automation”, it is something that will “be expected” in future agency models. She also suggested that procurement is making life for agencies “extremely difficult” with the added pressure put on margins. Patel agreed, adding agencies need to improve on measuring the longer-term impact that they have on business, which in turn would drive better remuneration.
She said: “It is that impact on growth and future bottom line that comes from really creative innovative thinking, and I still don’t think we’re great at measuring that bit, so we default to the output time-based model.”
“In the future, agencies will have to be more entrepreneurial, braver and have some skin in the game when it comes to renumeration. So, instead of just giving away all our IP for free, maybe we do actually have to put our money where our mouths are. If we think it’s a brilliant creative product idea or software idea, maybe we actually have to invest in it ourselves rather than just giving it away.”
As expected, the topic of how tech will play into the agency of the future was a big talking point, with Patel suggesting eventually, technology advancements will hit parity level, which is something agencies need to prepare for.
“Everyone will be super personalised, super localised, super-efficient, super relevant and then once again, it’s going to need a really creative, innovative solution to leapfrog it again.”
The Trade Desk director of business Stephanie Famolaro she sees technology influencing agencies in two key areas: automation and proprietary advantage.
“When we talk about what sort of skillsets agencies or brands have and what is needed and where the gaps are, automation is fairly simple. It’s connecting existing systems or new systems. It’s more of an infrastructural thing. There’s not a lot of creativity involved.
“When we start to look at customisation and bespoke and proprietary advantage, it’s infinitely more complex because I guess you’re solving the unique challenges of each individual brand and there isn’t often a logical place to start and the hypothesis isn’t always visible.”
For this reason, Famolaro said we will start to see the emergence of creative engineers, people that can combine art and science.
When asked what role the panel will have on their payroll in 2024, Patel said agencies will on some levels revert to traditional roles.
She said: “It’s almost a ‘Back to the Future’ model because our role is about getting around business problems and coming up with really innovative creative solutions to that. We will need more knowledge inputs in the future but actually what we’re going to deliver is the same.”
Patel also predicts media and planning skills will move back into creative agencies.
“I think media or connection skills, like planning skills, will move back in creative agencies because that is a strategic unlock. It makes sense to consider what is the problem, how are we going to unlock it and then what channels are available. So, maybe that one will be back in. Media buying could remain slightly separate or different.”
Patel and Lollback also both suggested a psychologist could be a role agencies will begin investing in, noting the growing rate of mental health issues across agency land.
Lollback said: “I would be very surprised if sooner than five years, we don’t have psychologists on the payroll.
“We saw the research come out only yesterday. It’s now about one in four Australians suffering some form of anxiety or depression. I think we all can talk to that issue. So, I think that will be the way.”
Lollback said GroupM has resigned accounts on a duty of care basis. “Our teams were under so much stress that I’d rather not have the business than have the teams under that.”
Patel said agencies of the future will need to focus on the culture agencies create, pushing a top-down approach.
“We try really hard in our agency to make the culture one that is positive, where you can be open, where you can talk about the fact that you’re struggling.”
On what is going to be different in conversations or actions in 2024, Patel said the topic of diversity will be different.
“I don’t think there’s a finite end to a conversation about diversity,” adding in the future the conversation would be under “constant iteration and optimisation.”
Lollback had a similar view.
“In five years from now, I hope the whole conversation around diversity is a bit like digital marketing. Five years ago, you didn’t need a digital marketing team. We’re still using that language today. We’re all wrong because we’re all in the digital marketing world. I hope in five years from now diversity is not a word we have to worry about, that truly we’ve worked hard enough, we’ve seen the light, we’ve run out of millennials to hire and we go and hire some other people.”
When asked if there’s any merit to the doom and gloom collapse of the agency conversation, Lollback had a simple response.
“We’ll definitely survive, we’ll just be different.”
Rogers said the agencies that will survive are the one who “prioritise intellectual property in the form of technology” and those that “shift it a little bit from the human capital where it’s not just service models.”
Patel suggested there is an oversupply of agencies and it will come down to survival of the fittest.
“I don’t think that means it’s the doom and gloom of the entire industry. It’s just that the very best shops will rise to the top and keep delivering outstanding, brilliant work and we might lose some.”