Forrester debuts its findings on “The Future of Advertising Agencies”

One key lesson: don't think audience, think in terms of community of participants

Last night at a special MITX event titled What is the future of advertising agencies? Forrester analyst Sean Corcoran asked a panel of Boston’s advertising leaders what they thought would engender success in the future.

Obviously we like Joe Grimaldi’s answer the best.  “Whoever hires the best talent wins.”

Our second favorite answer came from Larry Weber, serial entrepreneur, digital visionary and currently chairman of the W2 group.  “Brands need to build experiences, not produce campaigns.”

But the real show last night was panel moderator Sean Corcoran’s opening presentation in which he debuted the findings of his thorough research about the fate of ad agencies and the role they will play for brands and marketers in the future.

Sean gave us a brief history of agencies:  ad sales, owners of brand, losers of strategic influence, owners of big idea, splintered specialists — evidence of an ability to adapt constantly over the last 150 years.  But ever since the Internet showed up, agencies (some anyway) have struggled. They continue to think in terms of messages and campaigns rather than experiences. They’ve been slow to master digital technology. They’ve found it hard to move from an assembly line production process to one that’s iterative and adaptive.

So what’s next?  Here’s what Forrester says.  Based on extensive research, interviews with 60 industry leaders (myself included) here are the preliminary findings debuted last night.  In the next couple of weeks Forrester will issue a final report, available to both agencies and marketers.

We not only agree with much of what Sean says, we’re well ahead of the pack on many fronts.  We share, in italics, some of what we’re doing in light of these turbulent times.

It is a new world and clients know it.

• There’s a complexity of media relationships and an attention scarcity (content without walls).
• Despite Edelman’s recent findings, Forrester insists that consumers trust consumers more than brands
• The Groundswell has gone mainstream (consumer is creator/sharer/distributor and there is no going back so deal with it)
• WOM reigns again; your content and the experiences you create must stimulate it
• 3.5 billion brand conversations occur every day:  all in public

Note:  At Mullen, we’re addressing these changes in numerous ways: we developed the Modes of the Mind strategic approach that helps a brand understand its consumer’s relationship to content and community; we’ve built one of the advertising industry’s largest social influence groups; and finally we’ve created our own internal social media lab, which has experimented with projects such as Brandbowl and The Next Great Generation.

Consumers hate most advertising

• Only 5 % agree with advertising claims
• 50 % say brands don’t live up to advertising promises
• 67 % complain there is too much advertising

Adaptive marketing is the new model

• Powered by digital
• Real time response, like politics, is the future of marketing
• All about pull not push
• Addressability is here
• Intelligence and analytics will drive everything.

Note:  We’re in constant pursuit of speed whether it’s to respond or anticipate.  In the last year we’ve have added real time research, increased our social media monitoring capabilities, and developed a disciplined approach to conversation strategy so that we can respond quickly to changes in the marketplace or to community generated content.

There is a new media model

• Paid for scale and reach and speed
• Owned for content, relationships, listening and co-creation
• Earned (social, WOM, PR, bloggers, influencers)

Note:  We love hearing this, since we offer fully autonomous media services with mediaHub; content generation across digital, social, application development and mobile; and full-service PR and social influence.  Believe it or not, on a good day we can actually get them to all work together.

Successful agencies of the future will…

• Build campaigns PLUS platforms, not messages
• Don’t think in terms of audience but rather about a community of participants.
• Integrate in new ways: co-creation, curation, crowdsourcing
• Embrace and master new technologies quickly (iPad anyone?)

Note:  Take a look at what we’re doing for Timberland Pro.  TV, web, experiential, mobile apps but most importantly, all of tied up under a real positioning:  Stay on your feet.

Marketers will look for three things from an agency

• Ideas:  NOTE this does not mean messages or ads
• Interaction:  engagement, connection, community, media
• Intelligence: need to collect, report, analyze and predict

Note:  We have PhD’s from MIT doing our analytics.  We’re building predictive models you can actually take to the bank.

So yes, according the Forrester the future is coming and coming fast.  We say, bring it on.  The sooner the better.