Forrester tells ad agencies to change or die

13Feb08

 

Forrester’s Peter Kim has produced a very thought provoking read on the future of the advertising agency. The report argues that consumers now rely less and less on marketing messages when in buying mode. Instead they seek guidance from family, friends and others in their respective communities to guide them toward purchase decisions.

Obviously working for a PR firm, my views are always going to be biased but it is interesting nevertheless to read Peter’s conclusions:

Today’s agencies fail to help marketers engage with consumers, who, as a result, are becoming less brand-loyal and more trusting of each other. To turn the tide, marketers will move to the Connected Agency — one that shifts: from making messages to nurturing consumer connections; from delivering push to creating pull interactions; and from orchestrating campaigns to facilitating conversations. Over the next five years, traditional agencies will make this shift; they will start by connecting with consumer communities and will eventually become an integral part of them.

Peter’s views via AdWeek

(Agencies are) “in “a world of hurt” because consumers are tuning out the messages the industry is predicated on producing. Instead, it believes shops need to be organized around communities, not disciplines. What it is calling “the connected agency” would not only know certain communities but also be active members of these groups. Pushing messages would give way to encouraging voluntary engagement, and ongoing conversations would replace time-based campaigns”

Peter’s views have obviously acted as a catalyst for some interesting discussions from the industry, for example:

In agreement: Big Picture Advertising:

…I think the traditional agency model is broken. Being a factory dedicated to producing 30 second commercials, websites, banners and buttons or mail packs is not a viable business in an age where consumers are AdAvoiders and media is evolving so fast.

In dissent: Herd – the hidden truth about who we are

…a big fat “NO” to the idea that there are “fixed communities”: this reeks all too much of the network theory that geekworld likes; human social connections are much more interesting than that model – derived from the tech world – suggest.

Somewhere in the middle: PaulIsakson

I completely agree that many agencies are out of touch and need to learn how to facilitate and participate in the conversations taking place vs. interrupting them… I don’t believe the answer is an agency of mothers working with Proctor & Gamble to help them better communicate with this segment.

My view is more closer to Peter’s when he states: “I don’t think agencies are going away,”  “They’re going to be the ones that help marketers to communities of mutual interest.” I believe that within a few years there will be less distinction between digital, advertising and pr agencies – we will in turn become influencer agencies that span multiple media.

I also completely agree in that it is far better to have peer recommendations rather than mass (spam-like) ads and that those agencies that understand the power of social media are far likely to be the leaders over all marketing communications in the years to come.



8 Responses to “Forrester tells ad agencies to change or die”

  1. OK, I do say this because I have a vested interest on the question BUT I would beg the question of “why is Forrester having an opinion on advertising” when they struggle to deliver IT Analysis insights for vertical industries?

  2. I guess knowing what to do and doing it yourself are two different things. The latter certainly requires far more resources – however, within the area of peer/evolving influence I do believe that Forrester is in a leadership position and have hired well. Now if only they will match this for their other areas…

  3. Hello Jonny – thanks for sharing your thoughts and starting to show how the discussion is being woven together. To Ludovic’s question – I write my research for a client-side role; the Connected Agency was written for marketing leadership professionals.

  4. I’ve struggled to make sense of this article (not your blog post). For one I am having trouble understanding if we are talking about agency structure, advertising in its self as a traditional medium via traditional media versus social technology, or the marketing message.

    Either way it is a little absurd to suggest advertising in the sense of commercials and print ads is failing. For one, good traditional advertising lends brand credibility. Furthermore Ads that connect with their market segment are very effective. I think a good ad can make all the difference. And yes, we are becoming desensitized to marketing messages – but that’s the talent of it. The trick is knowing, engaging, and capturing your audience. Take some of the recent Hardees commercials or the Toyota tundra commercials – glorifying the common Joe. Flattery works and so does advertising. Let’s not forget Buzz-marketing and Advertising are separate tactics within the larger sphere of marketing communications.

  5. Kevin, you raise some very good points. I think that the hub of what Forrester is getting at is that messages directed at individuals through ones peers are far more likely to resonate with them compared to a mass-ad approach. This isn’t to say that advertising can’t be creative but rather other marketing tactics are beginning to become more cost effective. There will always be a place for best-of-breed solutions but as technology evolves so does the medium by which messages are transmitted.

  6. Jonny
    Thanks for commenting back – I think you summed it up very nicely with “as technology evolves so does the medium by which messages are transmitted”.

    Some traditional avenues are certainly going wayside Traditional Business and phone directories, regional newspapers.

    I think many of us still like the feel our niche magazines which can conveniently go where technology is best left alone. And TV has its own evolution but we’ll always have a place for living room entertainment.

    I like to think of the current state of affairs as an Expansion of possibilities rather than a Coup d’état. But I can certainly see the need to be on top of it – as new technology, media democratization, and social venues in technology (level the playing field) and make it possible for anyone to shine or else.


  1. 1 Outside Line » Blog Archive » Talking with, not talking at
  2. 2 Forrester report: redefining high-value customers « Technobabble 2.0

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