Three incidents in the last week have made me see in sharp relief the existential issue facing the advertising industry.
The first incident began with a text message from an old friend, a designer who had set up a creative shop about three years ago. There was something alarming about the message. He wanted to meet urgently.
We caught up the same day over a coffee. I had stayed in touch with him through Facebook. His updates were always upbeat, and they showcased his company’s fine creative work. By all accounts he had built up an enviable client list, and an even better creative reputation.
I congratulated him on his creative success. He was dismissive (of his success) and almost immediately launched into a litany of complaints.
The long and short of it was that he did great work but found it difficult to charge a premium for it. They were working flat-out, 80 to 90 hours a week, clients loved them, but profits were slim and always under pressure from cutthroat price competitors.
It’s a story I hear a lot, from entrepreneurs and from CEO’s of big ad companies alike, how they struggle with the bottom line, irrespective of what they do.
The second incident happened at a big network agency I went calling on in my new avatar as head hunter for the industry. No they didn’t want account management or creative or planning people, but digital yes, they were most interested. By itself no big deal, except that increasingly this is the message I am getting.
The third incident was not exactly an incident, but a piece of data I came across in a Washington Post blog. Last year in America, customers spend 45% of their time on web and mobile platforms, but these two together attracted only 17% of industry spends. What a discrepancy!
That set me thinking. Ad dollars surely have to follow the consumer. And the discrepancy (between time spent on various media and industry spends) is probably larger in the MENA region. There’s a seismic shift underway in the ad industry. It’s not something that will happen in a distant future but is already going on and at a rapid clip.
If you own a creative shop or run a big ad agency, you want to be positioned on the right side of history. That means you have to know how to create content for new media. Otherwise you will be history, and sooner than you can imagine.