UK Ad Agencies Must Re-invent Themselves
Tomorrow’s consumers will be increasingly hard to reach over the next ten years so agencies will need to re-invent themselves to adapt, according to the new IPA report The Future of Advertising and Agencies: A 10 Year Perspective.
The IPA has teamed up with the Future Foundation, a global strategic consultancy and think tank, to produce the report looking at the future shape of the advertising industry.
The report cross-correlates Advertising Association Data with published information from the Bellwether Report, the Direct Marketing Association, the Institute of Sales Promotion and the Interactive Advertising Bureau.
As part of the reinvention which the report proposes, a move away from historic definitions such as ‘above the line’ and ‘direct’ to newer, broader definitions is put forward.
These include ‘named’ (or ‘personalised’ for example DM) versus ‘not-named’ (for example TV), ‘screen’ (for example TV, mobile) versus ‘non-screen’, (press, radio etc) ‘two-way’ (interactive) versus ‘one-way’ (passive).
The report says that in the future agencies must recognise that traditional advertiser/agency/consumer relationships will be challenged with new models of engagement coming to the fore.
As traditional advertising continues to decline, by 2016, the hypothesis is that media owners of all kinds, including online search, all networks, gaming environments and interactive digital TV, will be integrating brands directly into content and editorial.
The report adds that by 2016 if agencies continue to be in charge then commercial advertising will grow by an average 4.6% per annum, if it’s media owners it will only grow by 2.3%.
A worst case scenario for agencies is also outlined, whereby advertising becomes consumer led, meaning commercial advertising will only grow by 1.2% per annum.
Agencies are warned that they will need to assume multiple roles such as: agency as media brand owner; agency as joint venture partner; agency as content collaborator; agency as programme producer; agency as network creator; agency as data provider; and agency as data aggregator.
David Pattison, IPA President and Chief Executive, PHD Worldwide, said: “During my time as IPA President, I have talked a lot about ‘putting the business back into the ad business’.
“While this is very appropriate for the short and medium term, long term planning is also essential if we are to maintain our world leading position.”
IPA: 020 7235 7020 www.ipa.co.uk