What does the future agency look like? Part 2

In part one of this article I looked at how the client environment is changing in the age of technology and parity. In part two, I discuss how agencies will change as a consequence.

Content generators
Breaking through the clutter remains a challenge, to cut through, agencies will become content generators. In a way that‘s what they do now, except today’s content manifests in distinct marketing channels – mostly advertising, promotions, brand experiences and digital. Soon however the lines between these channels will blur and agencies will create brand content in many other forms and combinations. Accelerated by media fragmentation and technology, content will vary from movies to movements, from creating bands like the Jonas brothers to choirs like Glee, from social media apps to online games played by thousands of people across the world. Traditionally content has been the domain of media companies, which then engage brands through sponsorship. Branded content will become the Holy Grail, and agencies will own that space. This will cause a shift in how agency teams are recruited and designed – teams that are able to tell a brand story through engaging, interactive (aided by social media and mobile) content will be highly sought after.

Strategy and thought leadership
Agencies will invest more in strategic capacity. A solid strategy with clearly articulated campaign objectives becomes even more critical in a world where brand owners and agencies have a plethora of communications options available to them. This trend mirrors the increase in marketing investment and therefore rigour and scrutiny in the client environment.

Agencies will have to stay at the forefront of the changing communication landscape if they are to service their client effectively. They will become thought leaders and provide the crystal ball perspective to clients. Clients will lean heavily on agencies to interpret the complex and ever changing world. Agencies will allocate more resources to internal thought leadership programmes – this may be more company wide training, an increase in the sharing of global intellectual property within the network, regulated research time and more.

Investment in delivery platforms
The land grab for anything digital won’t stop, however agencies will also buy and partner with new delivery platforms such as mobile, film, gaming and experiential in an effort to own as much of the marketing mix channels as possible. This is driven by the need to keep apace with technological innovation, margin and revenue extraction.

Project management
There will be more investment in senior strategic project management, currently account management or ‘suits’. This role will evolve into a more strategic force. The day of paper pushers will be over. Being the front line, they need to be strategically sussed, they need to understand the client’s complex world and interpret it to their agencies and vice versa. They will go from being the note takers to the umbilical cord between client and agency – the way it should always have been.

The large will get larger
Finally, clients are going to invest disproportionally more with larger agencies. For a number of reasons – in uncertain times, the money goes where experience lies – ask the Mckinsey’s and Accenture’s in consulting, or the Goldman Sachs’ and the JP Morgan Chase’s in investment banking. Large agencies will have the depth of global experience that will give clients the comfort that their agency partners can safely navigate them through uncertainty. Large agency groups will also have the resources to procure the best–of-breed talent, new business platforms (as discussed above). In a nutshell they will have the experience and service offerings that will make them even more competitive than they are today.

Some things never change?
David Ogilvy once said: “We sell or else.” The fact that marketing is such a critical function means more scrutiny on investment and return. Agencies that don’t help their clients sell will see the door faster than ever before.

In closing
I’ve written many times before about how the flux the world is in has made us naïve. When people are naïve they appreciate the opportunities that exist beyond their own experience and knowledge.

This can only mean good things for the industry. Lets embrace our naïvety and boldly go forth where no one has gone before.

Follow me on twitter @ abeyphonogenic

What will the future agency look like? Part 1

In a flux
The world is in a flux; American politicians have played ‘who blinks first’ and arrogantly slid the world into economic turmoil; the Euro is facing possible collapse and all indications are that we are heading for another recession before even recovering from the last one. Added to this – technology continues to change the way people interact everyday. It is in this context that I pose the question: “What will the future agency look like?”

In answering this question one must first look at what’s going on in the client environment because agencies exist only to service their clients and ensure the sustainable growth of the brands they oversee.

The age of parity and technology
Other than economic uncertainty, which is already extensively written about, there are a two other major forces that are throwing the clients world into a spin. The first is that there is parity everywhere; parity of product, price and distribution. “within arm’s reach of desire,” first spoken in 1923 by the then President of Coca-Cola, Robert Woodruff, is no longer just the preserve a Coca-Cola, globalisation has made that apply to all products. This is actually good news, as in this new world order, the positioning of a brand in the consumers minds is the predominant differentiator left to brand owners. That’s a space where the marketing practice can thrive.

The second force is the ever-increasing pace of technological innovation that is rapidly changing the way consumers engage. There is a plethora of new products and applications that were not around not so long ago (smart TVs, tablets, smartphones ,Twitter, Facebook, Google+, Instagram etc). It’s difficult to imagine that Facebook wasn’t around seven years ago, Twitter six years ago and the Ipad, less than two years ago. Technological change is happening at such a pace that it’s almost impossible to plan how to use these channels to effectively engage with consumers. This pace of technological innovation is only going to accelerate.

Back in the day marketers used to promote their products through TV, radio, outdoor and print – the traditional above the line channels, today a brand owner can make a song, create an experience, launch an app, sponsor a team and many other activities to engage their target market. There is no longer a template.

Implications for the client environment
How does this change the client environment?

Marketing as a business input becomes more important than ever. More resources are being invested in marketing as the final frontier of differentiation, which means that marketing as a profession is going to become a more critical business function. Gill Rightford elaborates on this topic in her Bizcommunity article – The great business/marketing/advertising disconnect. Finally marketing will be taken more seriously

Strategic skill will remain paramount. In this complex, ever-changing world where communication mediums fragment everyday – well thought through and executed brand strategy is going to become absolutely critical. No longer can marketers hide behind an expensive ad with high reach. You simply will not be able to spend your way out of an ineffective strategy or mistake omnipresence for strategy. Also, just being present on a social network platform like Facebook, doesn’t mean you have a social media strategy – that’s the fad today. Check out Intel’s “Museum of Me” Facebook app for a clue on how social media can be leveraged to drive brand proposition http://www.intel.com/museumofme/r/index.htm

Also, the client environment is going to require more depth of skill and experience across communication platforms. Along with the traditional skills such as research and strategy, clients will tap into a new breed of resources that bring digital, mobile and cultural anthropological depth to their business. Digital and mobile skills are obvious, cultural anthropologists less so, they are individuals that are so close to the pulse of their communities, that they are able to provide marketers with a more instant source code of consumer behavior.

These skills are outsourced at the moment but they will become so important that they will soon be a part of the client’s permanent payroll. Additionally, due to the growing relevance of social media, in the near future you are not only going to have brand or campaign managers; you are going to have network managers: individuals whose job it is, to manage the virtual consumer network.

Those are the implications for the client environment, how does this relate to the agency environment?

Part two will look at how the agency will change.

Follow me on twitter @ abeyphonogenic

TOP 200

I was at the Mail&Guardian Top 200 South Africans launch last Tuesday afternoon (7 June 2011). It was held at Randlords – down town Jozi – I love that place, it really feels like the top of the world, you get a sense that you are in the heart of Joburg’s hustle and bustle. In my opinion this is the best venue of its kind in South Africa. I was there because I was fortunate enough to make the list in this year’s business category. I’m an avid reader of M&G so I’m honoured to be on it. This however, is not about me, it’s about the incredible people I met that day. I mean what else could I ask for? 200, young, bright minds in one place. I set out to meet as many people as I could, it was only a matter of time before I ran out of business cards but I still managed to get in touch with loads people.

Here are some of the super individuals that I met: Melita Steele, twitter: @Melita_Steele, is the face of Greenpeace in South Africa; quiet and unassuming but you could tell that she was on a mission. She said to me “What could be better than waking up everyday to save the world?” What could? Being green is the big fad today but here was someone who leads an organisation that’s been doing it before it was the in thing to do.

I also met Jema Grobbelaar, twitter:@Jemmasa, a 20-year old Kite Surfing Champion from Cape Town – well not really since she also lives in Wales and Joburg. Jema won the British Championship in 2008, 2009 and 2010. She is an ambassador for Woman’s rights and looks like a supermodel – wow!

Then I met royalty – two Chiefs to be exact, Chief Tebogo Motheo Mamogale from the Bakwena Ba Mogopa and Chief Moefi Edward Mabalane of Baphiring Ba Mabalane – I may run a business but these guys run nations; while I concern myself with sales and pitches and they worry about sanitation and water.

I met another young lady, Amanda Sevasti, twitter: @AmandaSevasti, who reignited my belief in social media, she also introduced me to Sipho Hlongwane, twitter:@Comradesipho who writes for the Daily Maverick and has over 3500 followers on Twitter.

I met Sithembile Mbete, twitter:@sthembete, the force behind the Right2Know campaign which has made a strong stand against the Protection of Information Bill and then I met Humairah Jassat, twitter:@humairhjassat, the founder of Pink Hijab Day – her initiative, where women wear pink hijabs on a specific day to raise money and awareness for breast cancer – she won the 2010 African Leadership Academy Innovation Prize for her amazing work.

I could have stayed in that place forever, there was just so much to learn. So here is my question: with so many incredible young people in that room and countless more out there – why don’t you have faith in Africa?

Intelligent Naivety

I bumped into a group of post grad students while I was at Vega last week. The brief interaction left me feeling really upbeat. For a number of reasons – they were energetic and passionate about the marketing, advertising and brand communication industry and they seemed to want to get stuck in and add value; I felt that they were all confident that they had something to contribute. The chance meeting reminded me of “intelligent naivety” a term that I picked up in a book by Adam Morgan titled ‘Eating the Big Fish’.

Adam Morgan is the founder of Eat Big Fish, a challenger brand thinking consultancy based in the UK. The consultancies first book, Eat Big Fish, made such an impact on me that VWV actually got into negotiations the consultancy to turn its content into one-day workshops, the idea was we could add their challenger brand IP to our brand experience expertise to create a globally sellable product. The partnership never happened but I remained inspired non the less.

So what is intelligent naivety?

Intelligent naivety is intelligence naively applied. It’s the notion that you don’t have to be the most experienced in the game to come up with the best idea. Its happened all around us – Richard Branson knew very little about airlines when he launched Virgin Atlantic but he was the first to bring personalized on-board entertainment onto planes – can you imagine a long haul flight without being able to select your movie of choice? Barak Obama showed up his fellow presidential runners when he made social media a real asset in his race to the White House, now even Jacob Zuma has a twitter account with 28 500 followers.

These students need to be accepted into the marketing fraternity with open arms, as they are the ones that will refresh our staid industry. They need to use their unique perspective of the world, their seamless integration with new platforms such as social media and their understanding of how the world works to their advantage. They should not try and emulate the behaviours and perspectives of others out there – there are enough of us doing that already.

They are intelligently naïve and that’s a powerful asset.

They also reminded me of how important it is for individuals in the industry to regularly share their perspectives and experiences to continue to fortify the foundations of our industry and inspire new thought leadership.

So what now? I’ve invited the students to VWV to get a better understanding of what we do, who knows – they may be the next step in our story.

Check out Eat Big Fish on www.eatbigfish.com

Leadership in the age of communication

Having read my blogs, you’ll know that this is my favourite topic. We need leadership to help us through this defining time of our generation – the world’s people are going through a process of re-evaluation of who they are, what they stand for, and where they are going.

I don’t know how much you care for astrology but I have a friend in the know who tells me that we’ve been moving into a new cosmic age – that of Aquarius. Apparently this is the age of truth and it was poignant to hear as I was settling down to write this opening statement.

This change is taking place on a global geopolitical level, a regional level, a country level, and even on a community and individual level. One example is the dynamics between the world’s global powers that hasn’t really shifted since World War 2 (the fall of the Soviet Union had long been predicted); today, China and India can no longer be considered emerging powers – they have emerged and are here to stay. It’s not taken for granted that the US can do how it pleases.

The global landscape is less about the size of your military arsenal and more about your economic influence and the size of your domestic market.

China isn’t just the factory of the world; it is a serious contender and will soon boast the biggest economy in the world.

On a regional level, in countries like the US, a population of predominantly white people voted for a black president. In South Africa, the country’s president was ousted “constitutionally.”

These are major shifts that are defining what the next 100 years will be like.

On an individual level, there is introspection about men’s roles within families and communities. Antonio Lyons produced a play called “We are here” that explores issues and themes from the male perspective in the modern age. I also picked up a great read by Andrew Ramano and Tony Dokoupil in Newsweek that interrogates the role of men in today’s society.

As a young African, all of this is very exciting for me as it demands a change in leadership and, more than ever, men and women who are able to provide direction and galvanise us forward. But I’m deeply concerned that the people we are relying on us to show us direction and engaging on matters that will define our future are, in my opinion, ill-equipped.

In SA, over the last couple years, for some reason there has been a lack of independent constructive thought. Are we really only relying on Helen Zille and Zwelenzima Vavi to challenge the current power status quo? Or on Julias Malema to table the debate about mine nationalisation? I must say I have been impressed with Barney Mtombothi’s Financial Mail editorials – but that’s his job.

If you have an opinion, an informed opinion, your voice needs to be heard so we can all dialogue about where we should be going.

Is it you we are waiting for?

The ‘W’ manifesto: five

So, in the fifth and final part of this particular blog series of ‘W’ manifesto I will cover how to start building a navigator. For details on what a navigator is see blog 1-4.

Understanding a cluster of consumers is the first step. Who are they? What do they do? What is important to them? What decisions do they require help with? Who do they currently seek help from? What can the navigator do that will add immediate value to their lives? A lexicon of knowledge needs to be developed around a cluster in order to optimally position the navigator for market entry.

The next step is to have the right infrastructure in place to facilitate the decision-making process. Infrastructure such as a call centre; computers with CRM software that will enable you to capture and mine information about your consumers, and a network of resources that will help you make the most effective decisions for your consumers. This network of resources will include a database of car dealerships, different car finance methods and any other available resources that will help you help the consumer. I propose that each cluster start off by building capability around the most likely areas that consumers will need assistance – these areas will be revealed by your cluster insight research. Older, married women with children and family will have very different needs to school leavers that have just entered the working world.

Along with the ready for market capability around the cluster, I propose that a separate division be set up to constantly mine consumer data and behaviour so as to be able to constantly evolve the entire consumer offering from services to consumer interface.  

I’d like to use this blog more of the start of a discussion than a stone cast guideline. I hope it becomes the beginning of a dialogue about the genesis of companies that will ultimately own the future consumer relationship. In blog one I asked who was going to be the gatekeeper of the future. The gatekeepers will be the “true navigators”. They will be entrusted by consumers to help them make decisions ranging from insurance to travel, home loans to grocery shopping, and even media content.

Those companies that position themselves for this inevitable reality will be the barons of the 21st century.

What do you think?

Contact me at 898@vwv.com.

The ‘W’ manifesto: four

My previous two posts introduced the idea that since consumers are bombarded with choice, a new industry is on the rise. I’m talking about “navigators” or organisations whose sole purpose is to offering guidance and info in order for consumers to make the best choice between products and services.

The navigators will create an innovative business model that will encompass the following building blocks:

  1. The trust of the consumer – see blog 3for explanation
  2. Palpable delivery of value to consumers – see blog 3 for explanation
  3. A simple and effective consumer interface and
  4. An ability to constantly mine for insights in its consumer database
  5. And finally, the methodology to effectively leverage these insights

The interface between the consumer and the navigator needs to be simple, accessible and intimate at all times. Consumers must be informed that help in making decisions is only a phone call away; navigators in turn must strive to be the consumer’s NBF (new best friend). The only difference is that this friend will know everything, and can help with anything.

The last two essential building blocks are that each navigator needs to understand how to leverage insights and the power of each consumer community. It makes sense therefore, that each navigator be structured around a homogenous group of consumers or has divisions that are dedicated to each group.

Focusing on a single, like-minded group of consumers accelerates the learnings each group has to offer and in turn allows you to maximise your business design around it. A navigator can cross-pollinate learnings it has discovered in one cluster into another, but it cannot be everything to everyone. Being everything to everyone will elicit a shallow and less meaningful service to the entire database of consumers.

The more the navigator learns about each consumer cluster, such as how it works as individual consumers, as well as a unit, the more relevant its service will be. Simply put, the more competitive its advantage is as a navigator. I mentioned trust being the foundation of the relationship between the navigator and its consumer base (in blog 3) and the insight of the consumer base is in turn one of the foundations of trust.

In my next blog I will cover how you can go about building a navigator.

Contact me at 898@vwv.com.

The ‘W’ manifesto: three

In my last post I covered the idea that too much choice is having a negative impact on the consumer, and this will birth an industry of “navigators”.

These navigators are organisations whose sole purpose is to simplify the lives of consumers by offering guidance and information for consumers to make the most educated choice between product and services.

This new industry will create its own innovative business model. To compete, navigators will need the following building blocks:

  1. The trust of the consumer
  2. Palpable delivery of value to consumers
  3. A simple and effective consumer interface and
  4. An ability to constantly mine for insights in its consumer database
  5. And finally, the methodology to effectively leverage these insights

I will deal with each element separately:

Trust is the foundation of every fruitful relationship. It is imperative that all the actions the navigator takes inside and outside the organisation cultivate and maintain trust. It is only when consumers trust a navigator that they will divulge information that will make the navigator design ever more effective products and services. This premise should be the driver of all business processes.

It is for this reason that a navigator can not make any kickbacks from referrals made to any suppliers. Trust is a difficult quantum to reach but it is the key competitive advantage. It will make effective delivery of value to the customer base much simpler.

This brings me to delivery.

It is important for the navigator to provide its customer base with zero defect products and services. After all, the core purpose of the navigator is to help the consumer make the best, most informed decision.

If the service fails at this juncture, the navigator becomes null and void and in time, ceases to exist. An essential element of delivery in this category is going to be the ease at which the navigator facilitates the decision making process and the eventual delivery of the service to the consumer.

I will expand on points three to five in my next post.

Contact me at 898@vwv.com.

The ‘W’ manifesto: two

In my last post I covered the idea that too much choice, paradoxically, is having a negative impact on the consumer. It will eventually lead to birthing a new industry of “navigators” or organisations whose sole purpose will be to simplify the lives of consumers in terms of offering them guidance and information to empower them to make the wisest choice when it comes to product and service selection.

In a sense, these organisations already exist in the form of financial and medical aid brokers. However most ‘customer navigators’ in their current form provide vertical services, focusing on a particular field of expertise, such as investment advice as opposed to covering multiple fields. Most are also designed to benefit particular companies within that category as opposed to benefiting the consumer.

There are a few exceptions, such as Mortgage SA, which helps you shop for the best home loan in the market. I do not include initiatives such as “McCarthy Call a Car” because while it helps you find your ideal car, it only searches within its network of dealerships. This is the key difference with the future navigators – they will seek only to find the best possible solution for its client without prejudice or favour.

All too soon consumers will gravitate to the navigators that have their best interests as their core strategic imperative. All other sub-category navigators will become information pools that the true navigators will consult when processing a decision for its client. As opposed to going to sub-navigators such as McCarthy Call a Car, a consumer will consult his or her navigator and it will in turn consult all the possible avenues available to come to the best possible decision, including McCarthy Call a Car.

More on how this will create a whole new industry with its own business model in my next post

The ‘W’ manifesto: one

Do you ever think about the future balance of power in the world of consumer relationships? As a marketer it is definitely worth evaluating in order to spot the fast-growing trend of offering customer-orientated solutions.

In a few years, who is going to hold the trust relationship of the consumer? Who are the gatekeepers of the future? To make sure VWV is going to keep up, we’re all over this kind of questioning.

Two key trends

I see two key trends that will drive the world’s marketers to these answers.

The first is the ever-growing insistence of everyday people to be treated as individuals and not as one of the ‘mass market’. More and more consumers are demanding customised products and services and that will soon become the only accepted norm. Companies that provide this “mass customisation” are the ones that are growing their share of the market within their particular sectors.

Which brings me to my second point, the increasing number of companies that are recognising this consumer trend and their ensuing drive to develop mass customisation methodologies as a solution.

Instead of mass customisation empowering consumers to make a choice between many competing products or services, the abundant selection has in fact made them less confident about making the best choice. This is my hypothesis but consider the economic definition of ‘opportunity cost’.

‘Opportunity cost’

An ‘opportunity cost’ is the perceived value of the best choice forgone by making an alternative choice. That is to say, if you have R10 and spend it on apples instead of oranges, your opportunity cost in that circumstance is R10 worth of oranges. The result of today’s abundant choices is giving the consumers the ‘opportunity cost’ of any particular product or service and this choice is constantly growing. Now, instead of giving up R10 worth of oranges to buy apples, you are giving up pears, bananas, watermelon, pineapples, grapes and a whole lot more.

Based on this premise, and as needs become more complex, mass customisation will grow exponentially with alternative choices – this in turn creates a situation where consumer’s ‘opportunity costs’ increase.

So, how are consumers coping in this age of abundance? They make the best choice where and how they can afford it. They also seek assistance to make these choices from professionals or other consumers that can provide purchasing guidance. This is prevalent in complex industries such as financial services and medical insurance. These are product categories that most people know little about, and in the drive to make informed decisions they seek guidance.

This trend will soon spread to industries such as travel, schooling and entertainment. The abundance of choice will further complicate even the most basic products and services and it’s only a matter of time before people will seek professional assistance to make these decisions too.

This trend will birth a new industry of “navigators” or organisations whose sole purpose is to simplify the lives of consumers. More on this in my next post.