As we start to climb out of the financial quagmire and look to rebuild businesses, grow lost revenue and start to move the marketing and advertising business forward, a vital ingredient seems to be lacking in the mainstream agency world. That component is the entrepreneurial spirit, the can-do attitude, the savvy go-getting account leadership that can generate new ideas and models to solve clients’ business issues and in turn create new revenue streams for both agencies and clients.
Here’s a snapshot of what I believe is a big entrepreneurial opportunity for agencies, which I describe as “commercial innovation”:
• Brands are struggling to reach and engage consumers and to get more bang for their buck. No need to expand on this.
• Agencies continue to be under increasing margin pressure. Shops have great assets in strategic thinking and creating great ideas and intellectual property (creative business ideas), but cannot fully leverage these and get compensated for them.
• New opportunities abound. Whether they are distribution platforms, ease of creating content, new devices that bring true convergence to the palm of your hand, user-generated content, social networking, apps and more, all this is set to increase exponentially, particularly as mobile Internet access gains momentum.
• Brands have a number of assets that they could monetize more or create more value from (for example, data, customer relationships, content, events and experiences). There’s also a growing desire by clients, platforms, entertainment properties and other entities to form alliances and partnerships to leverage one another’s assets for mutual benefit.
• Agencies (media and creative alike, but especially media) should be perfectly positioned to connect the dots among brands, content/IP, platforms, customers, etc., and create revenue and opportunities for their clients, themselves and the partners they attract.
The opportunity is obvious, but making it happen is less so. Clients I have spoken to understand and totally buy the idea of leveraging their assets. Some Fortune 500 clients are pushing their agencies to create commercial innovations, but many shops that I’ve spoken to about the concept just seem too frightened to try anything new.
The range of responses I’ve heard include: “We couldn’t possibly take the risk of moving outside of our core,” “We haven’t got the caliber of people to do this,” “We can’t invest any at-risk money,” “While we like the idea of creating new intellectual property that we have ownership in, it’s not really what we are about,” “We have all the specialist expertise/divisions in the holding company, but you know the politics of getting everyone to work together” and “Your approach isn’t scalable.”
Maybe I come at this with fresher eyes than most, having become an entrepreneur in the converging worlds of brands, entertainment and technology three years ago, building on 25+ years experience in the advertising and media business (as a media buyer, strategist, CEO, suit, new biz guy and global account leader).
The last three years have forced me to evolve rapidly and develop new skills and attitudes to doing business and making things happen: thinking on my feet about issues that I’ve never come across before; developing tailored approaches and solutions where the commercial terms of every deal and the revenue flows are different; forging partnerships with new businesses; creating intellectual property and opportunities; and holding clients and business partners hands as we all jump into the water together.
Jumping into the water is a great analogy. Former JWT creative chief and chairman, WPP board director and leading U.K. industry figure Jeremy Bullmore (who WPP Group CEO Martin Sorrell once referred to as a “living national treasure”) said to me earlier this year: “You’ve definitely identified a big opportunity and need for both agencies and clients. But you need to get them over the ‘penguin syndrome.’ Every morning when penguins wake up, they know that they need to get into the water. But they all hold back until the first penguin jumps in [because] they don’t know whether they are going to be breakfast or have breakfast.”