The agency model of the future: How the coronavirus pandemic has forever impacted the way agencies do business
Creative collaboration is what will enable agencies to remain competitive in the long-run
“Every success story is a tale of constant adaption, revision and change.” – Richard Branson
These words I find, capture the sentiment of agencies today in this pandemic hit world. There are so many unknowns and questions that have no clear answers. The impending dilemmas we face will impact not only current business but also agency models, and this has been in the making for some time. We have seen agency businesses being eroded by the aggressive moves of consulting firms like Accenture, IBM, PWC, Deloitte, Capgemini, etc. By marrying their seasoned data prowess with strong creative talent, they were becoming serious competitors to the traditional agency. Independent creative and digital hot shops also were slowly eating into the pie of opportunity with their nimble structures and quality work. These and other challenges like the hastening of the need for all things digital were forcing agencies to reimagine their business models to stay relevant. The change was inevitable – but the COVID-19 crisis could be the catalyzing ingredient that will bring about some long awaited changes in the communications industry.
While I spend time at home, away from the stress of travel and busy schedule of meetings, I wonder how this new reality will play out. We all still have a need to communicate with each other, even virtually. There will be a fundamental change in the way we engage with each other and our client ecosystems now. There are some things that we can predict easily – the emphasis on face-to-face meetings will diminish for the foreseeable future. We have discovered the practicalities of using Zoom, Microsoft Teams, Google Hangout, etc. which has been effective with no appreciable loss of productivity. A greater cost sensitivity will mean no more flying a team to another city for one meeting and so on.
The pandemic situation however has impacted much more than how we work. The world as we know it has changed and with it has changed forever how we live, how we interact, how we buy, what we value and who we trust. Brands need to be aware that there is a shift in mindset, everyone has had the time to reprioritize – the environment, empathy etc are much more important now than they were earlier. This is apparent with the outpouring of support for health workers, government officials and others and the newfound appreciation of household staff. The increased cost focus will mean a more cautious and thought out approach to spending.
As communications professionals and leaders, I believe that what we do has never been more important. We will see a shift in our role from brand and reputation building to educating our clients about this new normal – helping them understand these mindset changes, the consequences and opportunities that will be available to them, predicting trends and advising them on how to engage and communicate with their audiences in a more effective way. In this challenging time, most client’s businesses have been impacted and we must also roll up our sleeves and be honest and sincere partners to our clients.
There is a huge acceleration towards everything digital, including media consumption and further adoption of e-commerce for even small and medium businesses. According to a BARC Nielsen report, average time spent on mobiles has increased by 12% since we went into lockdown and with people on their phones all the time, fake news is at an all time high especially on social media. This has resulted in a high level of trust and dependence on earned media. Within this atmosphere, people want to be spoken to honestly, they want to know what is happening instantaneously and they want to know they can trust what they hear. The media will go through its own shifts – they will also reimagine their models and we will see this soon.
What does this mean for the agency structure? A lot has been spoken about the need for a more collaborative model and this will become more urgent. With the increased focus on cost structures, agencies will need to relook at all roles and evaluate their relevance. Creative collaboration is what will enable agencies to remain competitive. For example, instead of continuously investing in building internal competencies, agencies will explore partnerships with third-party specialists. This will provide clients access to a wider scope of services while keeping costs under control. The end goal for the agency is to consistently build narratives that are relevant to audiences and cater to their changing preferences. A case in point is the increased consumption of mobile games, music streaming and audiobooks due to the lockdown. The challenge for agencies will be how to target audiences on these new emerging platforms, which will require a different understanding.
This open architecture-based structure and the emphasis on digital will also require a complete rehaul of talent. Tangible, deliverable KPIs will be what clients demand and a justification of every rupee spent will be the new norm. The spotlight will be on measurement and ROI. This adds to the need for a multi-faceted talent base. This is not to say that creativity will no longer be core to the agency but skillsets like data analysis, media planning, etc. will also become increasingly important.
If we take a look at some of the most impactful campaigns in recent times we will see that this is something that all of them have in common – compelling storytelling backed by strong data insights, measurement, and purpose.
This is not just limited to the advertising agencies but also applies to PR agencies. PR agencies have for a long time now built large structures based on traditional media connects and the promise of navigating that universe. Never has that been more redundant than now, brands and reputations will be built online first and this recognition is the new reality for PR firms across the world. The existing models, talent and structures will have to be remodeled quickly to address this new reality.
In conclusion, to be effective, our structures will need to be more agile, we will need to be quick to adapt to new brand and consumer realities and shifts. We will enter a new era of collaboration and partnerships to survive and we will need to quickly reimagine and retool talent. I truly believe in the human spirit and our innate ability to face any challenge and overcome it. Humanity has done this for centuries, we will do this again. In the future, our industry will not only change, it will thrive.
Ameer Ismail, President, GolinOpinion part of MullenLowe Lintas Group
This article was originally published on Financial Express