Okay, so it may not win any Oscars but it is gripping stuff. As 2018 shows no let up in the all-consuming industry debate about what the future should look like, the leading actors are pumping up the rhetoric. But why "reckoning"? It's a noun with two distinct meanings - both of which are key to this drama.
Act I: Agencies counting the ways they could make money in a closed sector
In this act the world is simpler and the client:agency relationship is a transactional model flush with cash. Then the 21st Century hits, this model collapses and brands need a different sort of support - faster, cheaper and better in an agile ecosystem of diverse partners. But empires are not so easy to dismantle. Meet Cyril, the Cash Cow – a key player in this drama (and the root cause of why the plot has become confrontational instead of collaborative).
Cash cows are usually a mature product that generates a high ROI. That steady cash flow is then used to continue that products dominance of a market, as well as funding the growth of other less mature business units. But the agency cash cows are now extinct and so the agency model is collapsing.
The large agency groups have been disguising static and falling organic growth. They keep buying new companies because that allows them to pay shareholder dividend. Once those companies are in the group they fall prey to the same inability to grow. Talk of reducing the cost base by merging, by removing management and back office is just that – removing cost. What clients actually want, and need, is added value and innovative thinking.
Act II: The awakening
Profit now comes from being obsessed with delivering client value, not distracted with the latest acquisition. Those involved realise how much energy and wasted talent has gone into milking the business for cash rather than building something fit for purpose in the 21st Century. Clients have identified that agencies are just not getting there quickly enough and so are leading the way - first through highlighting the media transparency issues, and now through exploring what sort of structure they want to work within.
As the diversity of channels increases and mass personalisation puts a strain on brand resource, it is tempting to revisit the Full Service agency option. As one industry veteran tells the audience 'clients are fed up eating their starter in one restaurant, main course in another and pudding in yet another!'
However in the new VUCA world of work it’s just not that straightforward a decision. The need for the most original solutions is even more paramount and so new ways of working are required, not a comfortable retreat to the old safe ones.
Enter our hero, Tom Goodwin
"Don’t pull through the old via a new frame, re-imagine!"
The final act: the co-creation of original thinking
Internal marketers realise one way to accelerate growth for their brand is already within their grasp - to fully use the skills of their own team. The top concern of CMOs is that they are losing their talent. Skilled marketers who join to be part of an exciting brand find themselves spending too much time on administration and so leave. In the next couple of years, every repetitive task is automated - this frees up marketers to do what they do best - be human. Machines are great, but only human skills of empathy and creativity can find a way through complexity. New ways of working involve brands spending more time on quality thinking in order to generate better strategy and killer propositions.
Co- creation is the new 'control'
The twist of this tale?
Absolutely the opportunity is there for marketers to set the standard for faster, cheaper and better delivery. But the real problem about working in complexity is the more control mechanisms and fierce processes you try to put in, the harder it gets. Fluid, collaborative networks are the way to produce the amazing, original work that delivers true customer value. That requires the maturity of thinking of a new breed of marketers - there may be no Oscars available, but it will steal the hearts of customers.
Karla Morales-Lee and Lesley Donnelly are the founders of New Breed Services