What is the future for Chinese digital Agencies? Can the current 4A's in China continue to provide similar services in the same way in the next 5 years? Will the Brands continue to need (want) 4A's? These are probably some of the most frequent questions posed to me by Western journalists wanting to get insights on the Agency landscape in China. The simple answer from my perspective is that 4As will certainly survive and will continue to provide value to the Brands they represent in the short to mid term (talking of next 5 years or so). However, what is unquestionable, without doubt- is the need for continual evolution within the Agencies to accommodate the new digital marketing trends and directions.
Within we have representation from all major 4A Agencies and although their revenues have suffered under the Global economic downturn, it has also provided them with a catalyst for making some important structural and organizational change (I have done a number of posts on the impact of the recession so won’t cover that off again).
Below, I have outlined the key areas I think will/are emerging for Agencies:
Accountability and visibility into the advertising ecosystem will continue in China.
The full-service agency will return. With the divide between media and content blurring, the two disciplines try to get back together.
Performance led campaigns; where the outcomes and actual response rates will dictate creative real-time approaches as opposed to the much more difficult to measure “Agency led campaigns”.
Creative teams (typically art director and perhaps a copy writer) will now include an analyst that will interpret advertising results to be implemented into creatives.
Consumers of digital advertising will be paid (micro payments) or receive personal benefits, vouchers, discounting etc for engaging with ads and brand experiences
Digital solutions will routinely include multiple digital channels (always with a Social Media Marketing component) and be integrated across Mobile, Internet and offline.
Media planning and buying will become more complex (premium buys); highly personalized, targeted and little buying done in the way of ‘run of network/site’. Real-time Audience segmentation will drive purchase decisions and rates paid. Demographics will finally die. Targeting of messages will be much more about context – “when” and “how” rather than “who”.
Tracking and measurement technologies will increase (detail in next para).
I think the single greatest change will be the impact that technology has on every facet of the Agency business – the messages, the media, the consumers, the research and the results. The successful Chinese digital agency will need to embrace and leverage technology for some of from the most routinely manual processes (like media planning) to analysis and reporting on large/complex campaigns.
Within we have representation from all major 4A Agencies and although their revenues have suffered under the Global economic downturn, it has also provided them with a catalyst for making some important structural and organizational change (I have done a number of posts on the impact of the recession so won’t cover that off again).
Below, I have outlined the key areas I think will/are emerging for Agencies:
Accountability and visibility into the advertising ecosystem will continue in China.
The full-service agency will return. With the divide between media and content blurring, the two disciplines try to get back together.
Performance led campaigns; where the outcomes and actual response rates will dictate creative real-time approaches as opposed to the much more difficult to measure “Agency led campaigns”.
Creative teams (typically art director and perhaps a copy writer) will now include an analyst that will interpret advertising results to be implemented into creatives.
Consumers of digital advertising will be paid (micro payments) or receive personal benefits, vouchers, discounting etc for engaging with ads and brand experiences
Digital solutions will routinely include multiple digital channels (always with a Social Media Marketing component) and be integrated across Mobile, Internet and offline.
Media planning and buying will become more complex (premium buys); highly personalized, targeted and little buying done in the way of ‘run of network/site’. Real-time Audience segmentation will drive purchase decisions and rates paid. Demographics will finally die. Targeting of messages will be much more about context – “when” and “how” rather than “who”.
Tracking and measurement technologies will increase (detail in next para).
I think the single greatest change will be the impact that technology has on every facet of the Agency business – the messages, the media, the consumers, the research and the results. The successful Chinese digital agency will need to embrace and leverage technology for some of from the most routinely manual processes (like media planning) to analysis and reporting on large/complex campaigns.
As technological advances will enable people to consume the media they want, when they want, where they want and how they want. That kind of control will only increase with the digital convergence, which will further blur the lines between TV, the internet, mobile phones, music players and devices yet to be developed or thought about.
Future Chinese digital Agencies will look like today’s investment banks, with asset allocation, tools and experts, measurement and research teams and links to a variety of in-house and out-of-house specialists. Agencies will be evaluated and paid on measurable performance metrics that are predominantly outcome based. The creative guys will create engaging experiences (ads that personalize in real-time), rather than simple banner ads.
The agencies that commit to evolving will be best placed to navigate the future. After all, it is not about knowing exactly what the future is. It is about being ready for it. If you have any different views or ideas please comment below.
Future Chinese digital Agencies will look like today’s investment banks, with asset allocation, tools and experts, measurement and research teams and links to a variety of in-house and out-of-house specialists. Agencies will be evaluated and paid on measurable performance metrics that are predominantly outcome based. The creative guys will create engaging experiences (ads that personalize in real-time), rather than simple banner ads.
The agencies that commit to evolving will be best placed to navigate the future. After all, it is not about knowing exactly what the future is. It is about being ready for it. If you have any different views or ideas please comment below.
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