04 August 2020

A state of merge agency: Technology’s role in the renaissance of the full-service advertising agency

Nick Ford-Young

The advertising industry has always been occupied with agencies jostling to position themselves as ‘different’. It has become common practice for many agencies to react to market changes by making their service offering feel both unique and super specialist. However, this age is seemingly over, welcoming a new era fuelled by technology where many agencies must evolve or die.

Adland has always been heavily impacted by innovations in technology. One can delve into the history books and identify the inflection points in time, such as the emergence of media agencies in the 1980s to the boom of specialist digital and social agencies in the 2000s, where technology has been the driver for change. It has provided opportunities for agencies to differentiate and, in part, accelerated the move away from the traditional full-service agency model.

The return of the ‘one stop shop’

Today, the irony is that as an industry we are far greater than the sum of our parts. The fragmentation of the advertising landscape has led to silos of expertise from creative to PR, and everything in between as we attempt to sell in what is ‘needed’ for clients.

We have seen the industry become flooded with new types of agencies offering super specialisms to carve out a different offering. Yet it has fast become a hindrance for clients who often find themselves bearing the brunt of it – more costs, more layers of communication and more effort on their part.

As a result, we are seeing a growing trend of reunifying agencies; spearheaded by holding companies like WPP and Omnicom, who seek to add value for their clients across their networks. This tends to come in the form of mergers and acquisitions as it is the quickest and most effective way to achieve a full-service offering reminiscent of the past.

Whilst the idea of a merger is not a new one, we are seeing it become more prevalent in its various forms, such as:

  • Combining two disciplines – VMLY&R (2018), Wunderman Thompson (2018), Droga5 Accenture (2019) & Proximity Rapp (2020)
  • One location for inter-agency collaboration – Havas Village (2019)
  • Full Service “re-bundling” – One Ogilvy (2019)

The need to over specialise the simple business of communicating has started to fall by the wayside, in favour of streamlined organisation structures where agencies have started to reframe their offerings from what they can they do to how they can help.

The One Ogilvy model offers an interesting approach towards a simplified structure, where they have consolidated their individual brands – including ad agency Ogilvy & Mather, as well as Ogilvy PR – under the Ogilvy banner to offer a one-stop shop for their clients. However, even with the best intentions, the lack of agility means the turning tide may be too slow for cumbersome advertising institutions.

“One of the mistakes we made when we were looking at client integration was to assume that everybody [clients] uses everything, more or less simultaneously” – Rory Sutherland, Vice Chairman at Ogilvy UK

The idea of having all the tools and resources in one place is not necessarily the solution, it is only one of the required components for a modern agency.  It is combining tools with the right commercial structures and talent to be able switch things up quickly as client needs/challenges change, and crucially, heavily leveraging technology.

This need for agility & flexibility reflects the changes in the advertising landscape where the reality is that agencies are no longer only competing with other agencies.  They are competing with consultancy firms, technology providers and social media giants in order to be relevant in an ever-changing tech and data-driven landscape.

Data and creativity are the key to relevance

Whilst a traditional agency’s strengths lie in creative; many still do not maximise the use of data – be it due to a lack of investment, established processes, or an inability to be more agile. The fact is the future of our industry relies on data and technology to inform and improve the quality of our work.

“It’s the age of the customer, so what we have to look at is what customers will be doing, and then translate that into brands” – Brigitte Majewski, VP & Research director at Forrester

Therefore, it is essential for companies to start thinking how they can combine creativity with data. This does not only relate to having staff who can examine customer data in creative ways but using data strategically to add value at each stage of the process from planning to execution.

Brands will need data strategy and the right technology to allow them to analyse data, implement campaigns and optimise at every step. That is where the role of a new ‘plug & play’ agency model really delivers value: delivering the ability to plug in the right service or channel for a particular need.

Time for change. Again.

Boldspace was created out of this necessity for change. Our model puts data and technology at the heart of our offering without compromising on creativity. Our technology enables us to be proactive rather than reactive. Our use of data allows us to be transparent and open with our clients. Our “plug and play” model ensures we remain adaptable, agile and most of all relevant.

The ad industry has always been one of trial and error; it has changed and evolved with the times, adapting to the needs of clients and consumers.

This is the future, so it is time for change. Again.