Can agencies compete on creativity alone?

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All industries are going through digital transformation, including creative agencies, says Mirum's CMO.

Traditionally, agencies have competed on creativity: "the big idea" or "the work." Their forte has been finding insights and developing creative messaging to drive business success for their clients. 

The question now is: Will this be enough to ensure their survival? 

Think about what digital transformation has done to all of our expectations as consumers.

We all buy computers and phones and expect them to not only have twice as much power and more features every 2 years, but to also cost the same. We expect it of our cars and refrigerators, too. The expectation is that there will be a better experience and better value as time goes forward.

The challenge for agencies today is how to deliver on this expectation. It won’t happen by asking creative directors to be twice as creative, or strategy directors to be twice as insightful. Procurement might think we can squeeze teams to get a higher volume of work, but this has hit a breaking point. 

On top of this, the unquantifiable element, creativity, is being discredited. For agencies to reinvent themselves they must embrace digital transformation the way we recommend that our clients embrace it–by looking at software and processes together. 

In his now famous 2011 article, "Why Software Is Eating the World," venture capitalist and tech entrepreneur Marc Andreessen talked about how no matter what your industry, developing software that allows you to reimagine your business is the best way to protect yourself from being disrupted by startups or competitors. "Over the next ten years, I expect many more industries to be disrupted by software," wrote Andreessen.

Agencies are no exception. For agencies, "software" can have significant impact in three areas: managing knowledge, managing resources and managing client relationships.

When Publicis recently grabbed headlines announcing it wouldn’t participate in Cannes next year, the advertising world focused on the impact on the creative community and how the pursuit of creativity was taking another death blow. Wrong. The focus should have been on where that saved money would be going–to Marcel, Publicis Groupe’s AI platform. J. Walter Thompson and Mirum started on this approach two years ago with Pangaea, an agency tool that improves knowledge sharing and supports connecting teams. 

This is the first area where software can have a big impact: capturing what works on the myriad projects delivered around the world, so the agency gets smarter every day.

Managing resources has become increasingly critical because contracts have shifted from retained teams that act as extensions of the client organization, to project-based teams formed to answer specific client problems. As the consultancies have done before us, large-scale teams need to be assembled and applied to a client problem to be successful. Tools should be utilized that combine resource and project management and break down the internal walls that keep teams from collaborating.

The last place software can improve the agency "product" is also the most challenging, simply because it requires the biggest changes in human behavior—project delivery.

No one can imagine going back to fax machines. The question is, which agency is going to break free of email first? Efficiency in delivery is a win-win for both the agency and the client, and yet it rarely gets the attention of pitch consultants or RFPs in the agency selection process.

The use of extranets, creative review tools and instant messaging by teams can make the difference between hugely motivated and focused teams and teams lost in abject desperation caused by miscommunication and misunderstanding. 

The lesson here isn’t that strategic insight, creativity and technical competence are less important–they remain critical. The message is, they are not enough. Every industry is investing in software and exploring how technology can transform not only what they produce, but how they produce it.  

The agency world is no exception.

John Baker is Chief Marketing Officer at Mirum.