Here’s another piece (topical still, from earlier this year) by MAA’s Paul Simons who sadly died earlier this week. Paul was a previous chairman and CEO of Ogilvy UK.
Sir Martin Sorrel said, “There are very significant opportunities for a purely digital business such as ours (S4 Capital).” Clearly others agree including Mark Read (CEO of WPP) who hired Andy Main to head up Ogilvy globally. The emphasis Read is putting on the legacy assets of WPP is a big clue as he combines work streams such as CRM capability with traditional advertising. Nothing new here as the dated above the line and below the line differentiation of skills in the two areas produced debate for decades.
However it seems to me the move to digital by the big boys is a reflection of the seismic shift in marketing driven by several factors – such as the perfect storm of the internet and the intel it delivers on users. Therefore marketing is the subject everything else flows from. Ogilvy, just like most of its competitors, is an advertising agency at heart and not a marketing agency. Andy Main is about to get the balance adjusted and make sure his new role isn’t undermined by his consultancy mates in places such as Accenture and his old place Deloitte.
The reason why this is critical for WPP and all the other players in the park is the glass ceiling on available revenue to pay everyone. The consulting firms will gobble up the ad agency’s lunches as the client’s spend moves out of traditional advertising and in to all things digital. Assuming this view becomes reality there would be murder on the dance floor.
It is already happening like a plague in a movie! The Grey UK website says the agency provides “internet marketing services in London.” Hello, since when did Grey stop being a creative advertising agency to change into an internet marketing services company? I bet Vicki Maguire (now at Havas) wondered what her role was going forwards.
My waters are telling me this surge, the mergers and appointments, like that of Andy Main, are part of a land-grab; it is a race for domination of the client’s top table. I can imagine the various players competing with each other, up to school boy tricks to trip up a competitor. The reality is the lack of chairs around the table, a bit like the children’s game where a chair is removed when the music stops.
Finance is a complicated situation but nonetheless the available funds for fees will be finite and the consulting firms are predatory with impeccable credentials: they can wipe the floor with your standard account team in an ad agency, which neatly gets me back first to Ogilvy and then the future.
The future is likely to be about a new model for agencies and their role with client brands. I wonder if the separation of upstream and downstream might emerge. It is going in that direction and I suspect that is precisely what Martin Sorrell sees, hence his comment about ‘significant opportunities.’ Upstream being the policy makers made up of clients, data gurus and strategy experts with downstream being the various work streams such as on-line creative, off-line creative, media, production, CRM, etc., effectively a series of work units working on everything the upstream teams request.
I could see that working, I quite fancy doing it so I will sleep on that thought tonight!