It comes as no shock to anyone that many aspects of the country’s economy have changed rapidly and dramatically over the last year as the world adjusted to a COVID-altered landscape. That is equally true within the communications world, as major advertisers adapted to consumers taking a digital-first, virtual approach to shopping, creative and media agencies struggle to become nimbler and more responsive, and any publisher or content provider that is not Facebook, Google or Amazon looks to find any way to recover ad revenue lost this past year and compete with the “Walled Gardens”.
Like any other part of the communications landscape, barter agencies have had to adapt tactics and strategies to keep pace with these larger shifts—and some have done better than others. The smart ones took the following steps, including (1) deploying more investment dollars in the digital video, audio and out-of-home (OOH) media space than ever before where performance is still too new to completely understand the returns; (2) updating media management systems that enable activation groups to execute media using both first- and third-party data, and track and optimize that media more seamlessly; (3) celebrating wins and not dwelling on the stumbles that may happen where you need to move quickly, invest money in new channels and partners.
So much in the media agency world changed this year, affecting us all. For one, most retail, travel and other service-oriented clients curtailed all advertising for various periods as they figure out how to bring their services or products to market. Marketers also pivoted away from many traditional media channels based on changes in consumer behavior, including OOH media (both digital and static), local radio, digital audio, and network radio. On top of those two factors came a tightness in traditional video ad inventory as a result of the reduction of live sports programming, an inability to create fresh original content, including scripted, unscripted and awards shows etc.
It is all led to the rapid acceleration of digital content and advertising. The digital advertising world has not historically been where corporate trade agencies ply their trade. But with so much more time, effort and expenditure expressed across the digital spectrum (GroupM)that predicts digital will hit $110.billion in 2020, representing 51% of all ad spend) we have to up our game—which we have and continue to do so.
Here is where the changing landscape actually helps nimble shops get there faster: about 60% of major advertisers have moved their digital marketing eco-system in-house. They are doing this for several reasons: (1) transparency around fees (how much of the media investment is actually working media dollars versus tech and agency fees); (2) added control of first-party data given the strong pivot worldwide around data privacy; (3) agility to market (the need to pivot quickly when things are working or not working); and (4) Brand Advocacy (who represents the brand better than the company itself?). Additionally, the growth in new consumer streaming content providers (both legacy and digital-only companies) lends itself to increased supply and emerging competition. In a growing space like this, a media trade company can help smooth out revenue shortfalls by investing in their business today in exchange for advantageous buying opportunities in the future.
These trends allow a company to play a growing role in this ecosystem by (1) enabling transparency and reducing fees associated with the programmatic “tech” tax that marketers pay; (2) being highly nimble for one’s brands to leverage what is working; and (3) creating trade within this new digital streaming ecosystem, along with cost efficiencies that can be passed on to clients.
Finally, trust is a core value that seems to have been shoved aside in an age of misinformation and fake news. We all know that trust is the central ingredient in all inter-personal relationships and is foundational in the development of successful business relationships. Without building that week in and week out, no agency can hope to keep its lights on—literal or metaphorical.
As leadership scholar Warren Bennis once said, “Trust is the lubrication that makes it possible for organizations to work.” An even more famous Warren—Buffett, that is—put it more succinctly: “It takes 20 years to build a reputation and 5 minutes to ruin it!”
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