The shock of the new: scary for agencies, but inevitable

From new forms of communication to new ways of working, agencies need to embrace change or get squashed, writes Dominic Mills.

I was privileged last week to sit in on the IPA’s Diversification fest, a series of events that took in a debate and some practical hands-on sessions at The Bakery, Imagination and Google.

It’s all part of IPA President Ian Priest’s ADAPT agenda, which is designed to get agencies to address the future – taking in everything from the way they work with clients to new technology and business models.

“We have to reshape the model to reflect the way the business is evolving,” Priest says. “There are opportunities and new revenue streams to be had.”

Last week’s Diversification strand was all about embracing the new. New covers a lot: it could be new forms of communication – long-form content, brands acting as publishers, gamification or designing experiences; new, collaborative ways of working with other agencies or creative forms; new technology, that perhaps turns agencies into service providers (as opposed to the often one-dimensional ad factories they are now); or turning data into insight.

And new is scary. But it’s coming, and agencies need to embrace it or get squashed.

As Hamish Priest, who runs global innovation and partnerships for Unilever’s Dove brand says: “We are always trying to diversify our content to reflect what consumers want and how they behave. New ways of working are the norm.”

One agency buying into that is Lean Mean Fighting Machine (LMFM), a 10-year-old digital indie. Co-founder Tom Bazeley noted: “We go where the consumers are and where the tech allows us to go.”

As Bazeley showed with work for Flora, that can be quite radical. A Flora website allows people following YouTube or web recipes on their laptop or tablet as they cook to pause or rewind the instructional with a gesture – thus saving their device from being covered in flour, water or oil.

It’s not advertising as we know it, and nor is it content, but it’s bloody useful and it reinforces Flora’s links with its core constituency. It certainly got Wired magazine’s approval.

The difficulty is that most agencies are inherently conservative beasts, and few have the financial freedom of an indie like LMFM. The constant niggle of margin pressure – felt most keenly by the big network agencies but something to which none are immune – also acts as a drag.

In such a context, it’s difficult to take on the risk of the new. But it’s clear, especially if you listen to the way the likes of Unilever are engaging with, say, tech companies, that some clients could simply go direct if necessary.

“We see engaging with tech start-ups as the future of marketing,” says Jeremy Bassett, who looks after marketing strategy and new ventures globally for Unilever. “Tech enables us to have deep and lasting connections with our end users. Unilever’s core business model is being turned upside down by the new world, and tech allows us to be faster and more nimble.”

You get the feeling that Bassett and his colleagues hang out at The Bakery’s offices in Shoreditch, taking meetings with every start-up that walks by. It’s a good idea: The Bakery, for those who don’t know, exists to bring tech companies closer to the marketing community.

That is not to say agencies have no role, or that disintermediation is inevitable. Their creativity is a major plus – although not unique to them. But the strongest card they have to play is their knowledge and understanding of the relationship between the brand and its consumers.

This is something all the other interlopers who want to grab a piece of the action – tech companies, TV production houses trying to muscle in on the content drive, or even data insight specialists – lack. As Unilever’s Priest noted: “Agencies are critical because they understand our brands better than anyone else.”

In fact, if you look at the some of the work Aegis unit Vizeum has done with tech companies and brands, it’s possible to see how agencies can prosper in this world. The launch of BMW’s i eco-car range, for example, used innovative artificial intelligence provided by a tech start-up called London Brand Management.

Vizeum, which is more used to buying TV and colour supplement pages for BMW, brokered the relationship and project managed the initiative, acting as interpreter between the marketing and car speak of BMW and the tech speak of London Brand Management.

But the side benefit, which may turn out to be more valuable in the long run to Vizeum, is in the way that its clients view it differently: no longer as a provider of marketing communications advice or solutions, but a trusted partner dealing with issues that go deeper to the root of BMW’s business.

It’s a place all agencies like to think they can lay claim to, but rarely achieve. Grasping the nettle of diversification may take them there.