The industry often states the current business model of media agencies is broken. Dentsu Aegis Network CEO Simon Ryan argues that while data, digital and programmatic will be at the core of the future media agency model, they first need to demonstrate how they can transform their clients’ businesses.
Media and communications businesses have a narrow window of opportunity to get structuring and automation right to ensure a positive future – or in fact, any future.
Digital maturity in the market means that the old agency paradigm will not work within two years. The depth of services and specialisation within agencies needs to evolve faster than ever before to maintain a position at the beginning of the marketing business cycle. Crucially for agencies, there needs to be a behavioural shift with learning and development, a broader investment platform approach across local and international media and a clear focus on the mid-term development measures that are required for long-term success.
Prioritise programmatic
Agencies simply must gear up and be ready for the programmatic future. From my own perspective, this means ensuring that Dentsu Aegis Network is 100% digital and 40% programmatic by 2020.
I believe 60% of our own group’s client media strategy and investment will be underpinned by analytics within four years. Agencies need to invest heavily into data capability and drive a simplistic approach to solving problems. This can only be done by overcoming data complexity and having data leads and systems that can understand and deconstruct data sets into useable outcome based solutions.
So how do we achieve that? The massive amount of data coming through – from clients, local and international media, associated partners, and client data partners – will see an increase in demand for data-focused automation to drive ROI and accountability for every dollar spent.
Data at the heart of everything
With data underpinning both clients and agencies’ ambitions, agencies should become focused on all communication capability services including CRM, which is often overlooked. Clients are asking more for full ecosystem planning and customer interaction strategies; it’s not only about selling the car, it’s about how we get the customer back into service models and repeat purchase.
CIO functionality and marketing are intersecting on the client side just as technology and media are converging at an agency level. This dynamic of scaled, addressable content distribution through technology is at the heart of the future for both clients and agencies.
The automation agenda
While the industry is seeing more automated activity, activation is often limited by the ability of select media owners to offer automation and data to advertising partners. This needs to change, and it will. It is the joint responsibility of agencies, technology partners, platforms and media companies to deliver this agenda as one.
Pivotal points in the data and automation space are around speed of transaction, cost of client access and improved impactful inventory access for clients. The local media is working to varying levels of access, and with a number of international media opening themselves up to be active in the space locally, the inventory will increasingly become available.
This will also open up global investment platforms for clients and media alike, which is a great place to be, giving clients the ability to scope global opportunities. Whether it’s a cost-driven environment or linked to storytelling as part of a wider screen-driven media campaign ecosystem, the offering should always be bespoke to the interests of campaign delivery.
Examples of this include the differences across categories and local versus global clients, where all require a bespoke strategy that demonstrates a business advantage.
The media ecosystem changes ensure that client service teams must not only innovate with clients, but also have access to inventory that delivers on, and beyond, expectations. The business result for agencies is that they must change to ensure the viability of their business models are protected for the future.
The question for agencies and their clients is this: are you ready for what the future holds and structuring for success? We have to create change and innovate our business models to ensure our industry creates a constant point of difference for clients, a difference that competes in our industry and outside our industry!
By Simon Ryan
CEO of Dentsu Aegis Network Australia and New Zealand.