I’ve been mulling over this idea in my mind for a while and its this, i believe that the agency world is diverging to the extent that despite what we know, we’ll all becoming too short term focused. You have media agencies, the accesdent force, who are focused on digital and data and performance, they own the short-term impact, the campaign planning and the direct revenue generating activity vs. on the other hand the creative agency who have brand planners who are supposed to think of the long-term health of the brand and therefore the intangible value creating an emotional link with consumers. but for too long obsessed about the revenue in a TV ad or a website rather than the best for a brand and have forgotten (bar the scramble to win an IPA effectiveness award) the need to try to manage the long term.
Most of this split is down to metrics and measurement and data. Media agencies because of their ownership of digital have a huge amount of data at their finger tips and report upon these metrics regularly, they are focussed on “converting people down the funnel”, targeting people based on signals that suggest predisposition to convert or make an action. In this world it’s all about the final conversion and the short-term performance, necessary because of cookie windows and driven to a certain degree by clients who because they can measure something focus on that short-term impact (there is also the short-term impact of an average marketing tenure of 18 months to factor in, who cares about the long-term in this scenario!!). Also because much of this is tactical the impact on the brand is limited, rather like “price incentives” they have limited impact on those outside those who already know and buy into the brand at some level.
The work of Kahnemann coupled with that of Binet and Field shows that the longer term focus is the one which drives share growth or longer term profitability rather than short-term return on investment, but if the power is currently with the short-term and ergo media agencies (who are typically fixed on short-term investment decisions) what do we need to happen in order to refocus on what truly matters (on both sides of the agency fence)?
Some would argue that it doesn’t really matter, “if you look after the short-term then the long-term will take care of itself” or that “planning is dead in this interconnected world because by the time the plan is finished its almost obsolete”. This however misunderstands the impact of marketing and brands on a businesses success and valuation. The stock market may work to short-term goals but they are framed within long-term bands. Investors look to a 3 or 5 year plan delivered by the CEO and a marketing & sales (yep they are becoming the same again as every touchpoint allows purchase almost immediately) strategy should take this into account and align. Agencies should be key in driving this, taking a longer view, detailing a narrative, guiding product development to reinforce this narrative and make strategic investment decisions over a longer term period (and by agencies i’m agnostic who leads this but i see media as becoming the more strategic partner as they are geared towards representative data, performance data and investment decisions)
This longer term view should be fairly stable but should allow flexibility of investment over time to take advantage of audience consumption pattern changes or market shocks, this is the tanker in the title analogy. It’s the core, it’s proven (to a certain extent) but it can change direction and alter course if required but the weight of evidence needs to be behind it. The tugboats are the powerful little engines of change and represent, the mid term, that help rapidly shift the tanker about course, they are fuelled by learnings from multiple dinghy’s which represent the short term and are a constant framework of testing that should they be successful provide direction to the the tugboats all this should be underpinned an appropriate funding model that provides enough “fuel” for tanker, tugboat or dinghy to do the job appropriately.
I suppose the biggest threat to this model is the “new tanker”, whatever that may be. the way to defend against obsolescence is the process of the above. Yes disruptive technologies and innovations can disrupt the model, but if the business has a bank of learnings and a pipeline of new innovations they should be able to pivot using these to combat most challengers out there.
So what does that mean for the agency world, how do we bring the divergent back together and create the integration that clients desire (and which has been proven to work)?
I believe it needs 5 things
- Splitting language into Long term and Short term e.g. Long vs Short term planners
- A structural approach to innovation e.g. 70,20,10
- An understanding of risk i.e. bringing finance on for the ride
- An understanding of what the most efficient running of the brand i.e. ecosystem modelling or attribution analysis
- A desire to change in the face of new information e.g. a shift in cultural mindset
These all seem fairly straightforward written down (and obviously activation of them requires the development of new tools and techniques and a new way of working between agency types) but its surprising how many businesses and agencies still do not try to implement these simple canons to steer the tanker, the tugboat and the dinghys of brands and businesses