The Darwin Social Noise Blog.

03/04/16

The challenges of the future for digital agencies

I do not trust the gurus and visionaries who presume to know the future, and for this reason I will try to write this text without sounding like an alleged visionary, and will instead draw from my experience and my observation of daily reality at an agency like Social Noise. Please, excuse me if I fail.

To begin, I believe that the division between ‘digital’ and ‘not digital’ is antiquated and unambitious. The same people who read print magazines later share their ideas over social media, or buy tickets to see a movie using their mobile phones. In a matter of minutes. Sometimes at the same time.

In fact, we all are connected to some type of screen the majority of the time–the barrier between online and offline are eroding at full speed. Content meant for a screen (a commercial, a documentary, a game…) that you can enjoy using a television, tablet or telephone–is this online or offline? And the agency that produces the piece, is it digital or traditional? This view of the subject is quite obvious and generally accepted; you do not need to be a visionary to see it.

So, the first error an agency (or any professional in this sector) makes is in thinking that “the future is in the digital” simply because the consumption of online content has shot up or because the sector strives to classify certain methods and agencies as ‘online’ or ‘digital’.

I understand that people use the label ‘digital agency’ to denominate an agency with a higher level of digital sophistication, in order to understand us, but if an agency thinks that the way forward is to specialize and encase themselves in the digital, they’re doomed. Because everything is digital.

A development company, can specialize in digital knowledge, of course, in the same way that suppliers specialize in printing canvases, producing radio bits, or making logos.

But I understand that an agency is a team composed of experts at helping clients relate with the public in a creative, intelligent, and effective way. Because of this concept, the distinction of a ‘digital agency’ as an exclusive classification does not have a future.

Brands need experts that understand consumers and are capable of connecting with them, regardless of whether or not there is a screen or internet connection to serve as a medium.

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Agencies should understand the digital world. All of them. Because we are all digital agencies. The distinction between ‘digital’ and ‘not digital’ when we talk about communication is typical of someone who sees the recent past, rather than the imminent future.

That said, it is true that everyone currently uses the label ‘digital agency’ to refer to agencies that are strong in this area, so here are my reflections on the most important factors for digital agencies to keep in mind in the future:

– Integration: the future will accentuate the tendency toward integration of digital agencies with traditional agencies, of media agencies with communications agencies. On one hand, digital agencies will face increasing difficulty to survive in their niche with competition growing and attacking them from all angles. On the other hand, the rest of the agencies need to become digitally fluent as quickly as possible. Therefore, integration, under multiple modes will be a good solution for both sides, and a growing tendency in the market.

– Relationships with consumers: successful agencies (and brands) will not be those that have mastered a discipline better than their competitors (whether it be web, phones, television…) but rather those that understand how to connect with consumers holistically (through a multi-channelled approach), and engage in a relevant discussion with the public. From any starting point. And without forgetting that we are speaking to people who reject advertising, and who look for, consume, and share information and entertainment. The conversation is not only B2C (Business to Consumer) but also B2C (Brand to Community).

– Understanding of technology: it is indisputable that technology plays an absolutely critical role in marketing. And this role is only becoming more critical. The most valuable talent is the expert in marketing who understands technology, or the techie who understands the channels of communication. Technology is a facilitator of communication. The two go hand in hand, and are almost indivisible. And as technology becomes more complex, it becomes more necessary to understand what it can offer us. The agencies (and the brands) that do not understand how to incorporate technology into their marketing strategies will be left behind.

Competitive advantages: The 21st century agency needs to anchor its value proposition in something more than the provision of creative services. It is necessary to have a distinguishing value: competitive advantages in the business model. These competitive advantages may present themselves as any of these corporate assets:

  • A unique methodology (culture, direction, talent management, thinking…).
  • Intellectual property (patents, unique tools, etc.).
  • Membership in a solid international network, that provides clients and tools.
  • A brand of enormous prestige.
  • Strategic alliances of high commercial value.
  • High levels of financial capital, to consolidate business for rapid absorption or dilution, if not to fuel the purchase of what the market demands in each moment.

Legal limits: the development of legislation is always slower than the development of the technology, and agencies must know how to operate on terrain where everything is not perfectly regulated, but at the same time, everything has a certain risk. Particularly in the area of individual privacy and intellectual property. Peter Diamandis (of Singularity University; he is a true guru) says that in the future privacy will die, everything we do will leave a trace. This scenario seems far off, especially in Europe, but if we look back and consider what has happened in the past few years, it seems that we are indeed heading in this direction.

Change of mentality: this might be the most important of all. We have to understand the environment, read the market, anticipate and change our mental schemas of the past. Here are, in my opinion, some paradigm shifts for any brand, and for any agency (yes, also for a digital agency):

Now that everything is measurable, talent doesn’t pay as much (at least not talent alone), but rather results are what pay. Publicity has swung from being an art form to being a science.

Clients will not ask for campaigns that last for a certain duration of time, but rather for platforms of communication, holistic projects for long term communication with the public, that have an amplified trajectory over time.

The world has become audiovisual. Videos account for over 70% of global internet traffic. The majority of content that young people consume is in video format. Video is king. Everything has become fleeting, ‘snackable’…and audiovisual. Any agency that wants to compete in this environment should become experts in narrating stories through a video format.

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Measurement is a given; but intelligence is distinguishing. We have data, but we need information. One must know how to measure, and how to interpret. The role of big data in digital intelligence will become essential for any brand (for example, at Social Noise we place a firm bet in using big data on social networks that is processed by diverse algorithms as a source of intelligence for decision making in business.)

Life happens in real time. And the opportunities to listen or to communicate with our targeted public also happen in real time. Real time engagement at the right time, or at the right place, has an incalculable value.

Ecommerce. No further comment is necessary (type ‘e commerce statistics’ into google).

– Content and Relevancy. In 99% of cases, our brand does not interest the public. It doesn´t matter in the least. They can live without us. And we will not be able to capture their attention by how often we communicate with them. If anything, we will only annoy them. The only way we will get them to pay attention to us is by producing content that interests, intrigues, or provokes emotion in them (we are people, right?). Content is king and relevancy is queen. We must learn from Red Bull.

Loyalty. Sometimes we are so obsessed with the sales funnel that once we achieve brand conversion, we forget that the next step is equally important: loyalty. In the majority of sectors it costs 10 times less to reconnect with current clients than to gain new clients. And furthermore, a loyal client will amplify our campaigns, our content…

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Strategies for building loyalty should be managed across platforms of loyalty and of the activation of brand lovers anchored in technology (CRM, advertising platforms, gaming systems, monitoring in real time, etc). And when I talk about brand lovers that includes the employees of the brand (employer branding).

Agencies and brands should pay more attention to the loyalty and activation of clients as brand ambassadors, because current technology allows us to do this very efficiently.

These are precisely the areas Social Noise focuses on. Certainly, one might say that we are a digital agency, but beyond this label, this is our vision of the world. If you’d like, discuss this subject with us using the hashtag #retosdigitales (#digitalchallenges).

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