Do clients still need a media agency?
How long before all agency media teams are replaced with trading desks and robotic tool sets that replace all of the grunt work?
That's the question the San Francisco Bay Area Interactive Group attempted to answer at this morning's "Robotic Media: The Launch Of The Automated Agency" event.
There are a range of tools available to help clients automate their media buying and dynamically develop their display ad creative. But media agencies still think they have a place. Here are a few of the reasons put forward by the panel, along with my thoughts.
"Commodity ad stock is driving awareness but does not drive sales"
This is a warning call to clients. Why? Clients expect sales; particularly from their online ad buys. Beware the media agency that simply measures the effectiveness of your campaign by "impressions".
Commodity ad buys will not prevail in the "last click wins" battle. Therefore it's important for clients to consider their objectives when buying these ads.
If awareness is the objective, then metrics should be put in place to measure the effectiveness of the ad. This should go beyond the number of impressions - after all, how many banner ads have you ignored today?
If generating sales is the objective, then don't pay per impression. Pay per click, or better yet pay per sale.
"It's too overwhelming for clients to get up to speed"
This is true, too a point. The industry is changing rapidly, and clients should be focused on their core business, not trying to keep up with the explosion of tools from an ever-growing list of technology vendors. However, two things could happen. The pace of change could slow, enabling time-pressed clients to catch up. Or, they could simply hire someone with the expertise to bring the media buying capabilities in house.
"Automated creative can be powerful but it can't tell a story"
As the social contract with brands evolves, customers are expecting more dialogue and fewer monologues. Brands with a powerful story and those who effectively act as curators of content are proving that "content is (still) king". However, I don't see media agencies as being equipped to be the story tellers.
Clients need their agencies to be connected to their brand story, to be knowledgeable about their customers and to be able to tell their story in a way that cuts through the clutter while honoring their social contract with their customers. In my experience, traditional ad agencies and digital agencies are much better at doing this than media agencies.
There was some discussion about how difficult it is to find people who have the skills to pull insights and opportunities from data. Direct marketers have been doing this for decades. Now it's time for the media (and digital) folks to play catch up and help their brands make use of the immense amount of data that's available to them.
Adapt or die
As the changes in the marketplace necessitate changes to clients' marketing departments, agencies will have to adapt to stay relevant.
Many years ago, DM agencies used to manage the print buying process for clients (i.e. commodity buying). This was a service to clients - it meant the agency could handle the campaign from end to end. But clients began having to answer to procurement departments. Was the agency really adding value by being a commodity buyer? Now clients generally have a list of preferred print suppliers who they have negotiated with directly. Will the same thing happen with buying ad space? Media agencies will have to make sure they are bringing more to the table to ensure their survival.