6 min Read
Since the past decade or more, digital agencies have been increasingly offering full services, with added focus on creative strategy, production & physical events & everything outsourced, in addition to digital marketing. This was how ad agencies used to operate till the 1990s. The revolution refers to the agency business completing a full cycle which started in the 1990s. The silent bit is a well-known trait of digital activities.
Until the mid 1990s, agencies were the single point of contact for any Marketing Dept. Each marketing activity was routed through the appointed ad agency. By the late 1990s, agencies were flourishing, with rumors of lavish executive perks fuelled by the 15% commission & more. During the same period, there was steady media inflation. This combination was the prime reason for the decision of the Association of National Advertisers (USA) to separate media fees from creative fees. This gradually led to the breakup of the original ad agency into separate entities for media & creative. The media agency fee remained based on campaign-spends, although with a smaller %. But the creative agency was paid a flat fee which was not linked to campaign spends.
Phygital©
Agencies have witnessed how marketers have steadily shifted their marketing budgets from the traditional to digital, some faster than others. Also seen television reign as the no. 1 medium for a long time, until it got relegated to no. 2 position by digital. In India, Covid19 played a major role, when digital marketing peaked.
Post Covid, physical, customer-facing marketing activities shot up to new heights from zero, as it were. In many cases, they were in tandem with digital marketing. A phenomenon very well described in a single term : phygital.
Somewhere along, in response to clients’ demands, agile digital agencies started offering full services – from creative strategy to production to campaign execution to activation.
©Copyrighted by Momentum Advertising, Australia.
New-AGE-ncies
Since the past 2 decades, digital agencies have dominated the agency business, led by a horde of agile startups. These digital agencies started offering creative, production, on ground activities along with digital to their clients.
To compete, network-owned, large creative agencies needed to adapt to this agile, customer-driven model – but this involved a major culture-change, which is never easy for established cos. Those who did not adapt quickly were merged with younger, digital-first, creative agencies acquired by their network*. Other agency networks opted to acquire agile digital agency startups & merge them to form their own new-age agency.
*This has seen the planned demise of iconic agencies like JWT, Wunderman, Y&R to name a few, which were merged into a new-age group agency.
The result is that today’s creative agency resembles the agile, pre 1990s model.
Do you agree? Have a contrary point? Would love to hear from you.
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