Expert panel debates the impact of changing client communication needs on the agency business model and explores how they can adapt to the new landscape
Client demands on agencies are changing rapidly, led by the impact of new technology on communications consumption and the rise of non-traditional advertising, but that does not mean agencies will be sidelined, Hamish Priest, global media innovations manager for Unilever’s Dove brand, explained at the IPA’s Diversification Adaptathon debate last night (3rd February).
"Agencies are critical," Priest said, "because they understand our brands better than anyone else."
The ADAPT agenda, led by IPA President Ian Priest, is designed to create a platform from which agencies can improve their commercial creativity. The Diversification section looks at how agencies can produce more multi-dimensional output, moving away from traditional advertising to embrace new forms of communication and technology platforms.
"As agencies, we need to adapt faster and better," Priest said, "and we need to reshape our business model to reflect an evolving and dynamic landscape.
"Whether it’s content creation, providing new services in data and insight, or generating word-of-mouth via social media, there are new revenue streams out there," he added. "But we need to know how far we’ve come, what impact this is having on our commercial creativity, what clients need, and what we can do better."
The panel was completed by representatives of different types of agencies, each demonstrating alternative forms of diversification: Nick Cohen, managing partner of specialist media agency unit MediaCom Beyond Advertising; Jonny Spindler, chief innovations officer at AMV BBDO; and Tom Bazeley, managing partner of independent digital agency Lean Mean Fighting Machine.
Content drives Dove
Dove uses content to meet three main aims, Hamish Priest said: to tell new stories; to satisfy demand for content or information; and to attract and retain audiences.
Putting content at the heart of its communications strategy, Dove’s Real Beauty campaign has achieved 170m views and 4.6bn media impressions. As a result Unilever has evolved a content manifesto whose rules include: creating new content every day; always looking for ‘firsts’; not worrying about perfection; and avoiding budget-imposed limitations on ideas.
The ‘Real Beauty’ creative brief, Priest explained, was deliberately open – focusing only ‘Let’s make women feel more beautiful’.
"There were no rules on spots, lengths or formats," he added.
To satisfy audience demand for content and information, Unilever runs a YouTube property, All Things Hair featuring well-known video bloggers using Unilever hair products, including Dove. "There are over 110 trillion searches a year around hair," Priest said. "There’s a lot of demand for content."
Fifth (VW) Beetle
Relaunched in November 2012, the more masculine-shaped VW Beetle needed to appeal to men. Cue a plan from the content arm of VW’s media agency, MediaCom Beyond Advertising, to target 30-50 year-old men by associating it with their rock-and-roll youth.
This took MediaCom to
The result was an eight-part series on C4, Abbey Road Studios: In Session with VW Beetle featuring musicians like Paul Weller.
"Distribution was vital," said Cohen, "so we used Spotify, Facebook and YouTube to amplify the partnership with C4. We also made sure all the activity was joined up."
New units diversify AMV offer
Abbott Mead Vickers’ diversification was led by the addition of new services such as social media, data and analytics, and new technology, explained Jonny Spindler, chief innovation officer for AMV BBDO.
"Content and social are core to our offering now," he said, "but clients are crying out for data and analytics."
While agencies were competing strongly with each other to satisfy client needs for new forms of communication, they were all seeking to use their individual skill sets. "I think media agencies were faster than creative ones to get to content, but creative agencies have been quicker on social, he said.
So far, agencies were still working out how to make money from Intellectual Property or licensing, but at AMV some 8-10 per cent of revenues were now coming from these new services and products.
Ten-year-old independent digital agency Lean Mean Fighting Machine (LMFM) had never had an explicit diversification strategy, explained founder Tom Bazeley. "We go where the consumers are, and where the technology allows us to go.
"The new digital canvases have dictated how we have diversified."
Working closely with Google and YouTube, for example, LMFM found that more consumers were cooking directly from recipe videos on YouTube. But that raised all kinds of usability issues, such as pausing or rewinding with messy hands.
LMFM’s solution for Unilever’s Flora brand was a recipe interface accessible via the browser that cooks could control by hand gesture once they had pasted in the recipe URL.
"We’d had the idea in our tech department for six months," explained Bazely, "but we couldn’t find a use for it, or get paid for it.
"In the end, we took it to Unilever, and they funded its development without any guarantee it was going to work. It would not have materialised otherwise."
Key insights from the debate included:
- Producing content without distribution is pointless. Seeding content with a paid-for media budget and partnerships with media owners are essential.
- Media agencies are well positioned in the content area because their planning is based around content consumption habits and their ability to forge partnerships with media owners to maximise distribution.
- Agencies need to be fast and flexible. Getting it out can be more important than getting it perfect and, especially in technology, both client and agency need to be prepared to fail.
- The business model for the entertainment industries – including film, TV, music or gaming – is shifting. They all want to produce great work, and increasingly see brands as central to that. But it’s vital to join make sure content creation is joined up with other activity and does not sit in isolation.
- Agencies have always been good at collaboration, for example with the film makers and directors. But the new world order demands collaboration with a wider set of partners whether in technology, media or other sectors.
- Agencies that can use data to, for example, fuse social media numbers with sales to drive insights and future actions, could then produce work directly linked to specific outcomes. This could, in turn, lead to changes in their business models away from time-based charging.
- Agencies can work closely with media owners to get more insight into consumers that, in turn, gives creative work more depth.
- Creative briefs should be as open as possible, without prescribing areas such as format, platform or length. This gives agencies greater freedom. The Dove ‘Real Beauty’ brief, for example, said only: "Dove believes beauty should be a source of confidence, not anxiety. Let’s make women feel more beautiful."
- Although the opportunities are there, agencies have yet to implement business models based on IP or licensing. If clients fund the development of new technology or platforms enabled by new technology, they are likely to retain the IP.
How to get involved with ADAPT
The IPA’s ADAPT hub is the ‘go-to’ place for information on Ian Priest’s agenda. News from the events will be posted online as well as the findings, photos and videos from each Adaptathon. Visit www.ipa.co.uk/adapt for more.
Join the conversation on twitter with the hashtag #ipadapt and participate in the exciting discussions surrounding Diversification and the wider ADAPT agenda.
You can also debate and share your ideas on how the industry can adapt for the future, through the IPA’s LinkedIn discussion board. Visit http://linkd.in/16qdzN6 or search for ‘IPA ADAPT’ on LinkedIn.
This article was first published on