Last week, while France, I, and indeed nearly the rest of Europe enjoyed long, bank holiday weekends, Ad Age heralded digital as the savior of agencies in their 64th Annual Report. Sure, digital is a great ride. And now, with marketing services, drives up to half of the billings in the top 4 groups.
But has digital really been as good as all that for agencies’ business?
Digital requires a different business model, often very different expertise and specialized competencies. Add to that the complexity of good digital marketing, the blinding innovation of the digital space…and the last minute technical glitches that no one seems impervious to, pushing up time spent and project cost.
But agencies didn’t have a choice, right?
I had an interesting discussion with a former collegue, the head of an international agency within a large group. We were speculating as to the overall value of the advertising industry. Has value been destroyed or created? Is advertising a more valuable industry than it was 30 years ago?
And we worried that increasing pressure on costs coupled with the continuing need of lots resources – junior and less expensive – was driving a negative spiral. Among other things, this spiral makes it hard for agencies to hire people at their just value, often driving the best young graduates elsewhere (as client-side marketers, or to another industry altogether).
The ad industry has lost its spark.