Advertising is an age old industry with some well-known names globally having been established in the 1800’s.
In the local market there are many players who have been around for decades but there has been birth of several others, scioned from the first movers, their founder executives either choosing to go a niche higher or into direct competition with their former employers.
The level of diversification in this sector, at least locally, has been limited to horizontal integration with the fuller service description aptly summarised as full service agency covering advertising, marketing, communications and public relations with mergers and acquisitions as the preferred model or growth.
The world of commerce has changed and continues to change as consumers become empowered and brands more particular about delivering growth and achieving return on investment from capital deployed.
This is where the model of the traditional agency begins to break. The agency has been an intermediary between brands and the media, with the later having direct access to the consumer through print, radio, television and outdoor channels. This very profitable relationship is now under siege in the advent of mobile data and smart devices.
The agency middleman position as we know it will soon become defunct as digital properties spring up that give better and granular access to consumers, tools emerge covering copy and digital asset creation, affordable data management platforms and the role of Chief Information Officer and Chief Marketing Officer expand to include hands on analysis and creation of assets by in-house digital teams.
The politics and drama that is often seen in the sector does not help in an era where brands are extra sensitive to anything that may expose strategy, delay or jeopardise its execution. The margin and retainer business model has seen shrinking budgets and an increased ask for more bang for the buck.
The next generation agency will take the form of a software development house staffed with a data science majority, building out custom tools that will in turn power bespoke strategy. Tied to either a commerce or engagement performance indicator, the billing for such services will also morph, with the agency now able to ask for a piece of the revenue or savings realised up and above what would fall under the consulting umbrella, since everything can now be measured and attributed.