Asked today to identify the No. 1 threat to their businesses, the leaders of agencies and new technology companies differed a bit in their responses but overlapped on the issue of talent.
Beyond the prospect of tech players circumventing agencies to work directly with marketers, Benjamin Palmer, CEO of The Barbarian Group, said, “We have to stay ahead from a talent perspective.”
Echoing that concern, Magna Global CEO Tim Spengler noted that the commoditization of media agencies has driven down their fees, which in turn leaves less money to invest in new types of talent.
“That’s happening on the creative side as well,” said Durk Barnhill, the New York CEO of Saatchi & Saatchi. “A lot of our clients are saying, ‘Ok, so next year we’re going to take 25 percent of our budget and we’re going to dedicate that over to all things digital.’ But that [overall] pie still remains the same.
“So, to get the talent and the people in order to get that done, we have to switch out a lot of people in your agency and reinvent and transform your agency,” Barnhill added. “A lot of us are doing that and having to reinvest in that. But I think clients have to understand that all these things are going to be integrated, all the things have to be based on an idea and not the technology itself.”
The talent headache arose during an Advertising Week panel discussion led by Wired senior editor Cliff Kuang that also featured Mojiva CEO Dave Gwozdz and Heidi Browning, svp of strategic solutions at Pandora. On a more positive note, panelists identified key opportunities for growth.
Spengler asserted that complexity in the marketplace, in the form of big data and new technology, creates an opening for media agencies to help marketers better understand what’s going on and how to leverage it.
“You can lead clients through the complexity and what we’re trying to do … is tie our performance [in that realm] actually to our remuneration,” Spengler said.
Turning big data into smart data and then wrapping that in a big emotion is the carrot before Saatchi, according to Barnhill. In other words, use data to redefine your company’s core mission, as Pandora and Netflix have successfully done.
The broader trends of personalization and mobility represent ongoing avenues for growth at Pandora, Browning said. Palmer, meanwhile, simply covets the potential of certain brands going all in on mobile.
“Everybody is still kind of hedging a little bit, you know? Like, ‘We’re going to push on mobile but we’ll just like try out a bunch of things,’” Palmer said. “And I think it’s actually going to take a few big brands deciding to have entire mobile, digital experiences for the level of innovation to happen.”