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Opinion: Agency Existential

In Adland, the next generation is usually the same as the last. Maybe not this time, writes James Dunne.

What do Y&R. J. Walter Thompson, Wunderman, and, let’s say, McConnell’s have in common? They no longer exist. They were, in fact, killed off. These were totemic brands of advertising, each with a storied legacy stretching back to the days of the 5-martini lunch. The very idea that they wouldn’t exist only a decade ago would’ve got you laughed out of whatever awards dinner you happened to be at.

For an industry that supposedly nurtures and protects brands, the kill off came as a shock. And it reeks of an uneducated ruthlessness, the sort of ignorance that could only come from some 35-year-old, financial whizz-kid/barbarian, unversed in the lore of Adland, wielding their spreadsheet like a machete.

But I say: couldn’t have happened sooner.

Before you accuse me of more anti-advertising agency bias, I could point to a host of deeply established digital shops PR brands and everything in-between that have ‘gone away to live on the farm’ in the last half decade. I should point to the fact that 2023 was the biggest year for M&A activity in the agency space since the heady days of digital. So, you could argue that’s there’s something going on beyond ‘out with the old’.

But I would disagree again, it is very much about out with the old.

If you care about the business we still persist in calling ‘advertising’, if you care about commercial creativity, then the kill off is an essential part of rebirth and renewal. Yes, some of the cull is a product of getting balance sheets ‘in order’ but I think Holding Company honcho’s look at the delta between their share prices and that of the consultancies and they get spooked. Or jealous. They see the dire need to address the imbalance in value creation for the client. The delta in value between say, an IPG and a Deloitte, is the value creation grey zone – and it’s up for grabs. And right now the consultancies are marching in.

No one gets fired for hiring IBM. But IBM isn’t even IBM anymore. If you’re in an agency I guarantee in the next 5 years, you’ll be pitching against IBM. Or at the very least competing with IBM for talent.

Arguably those euthanised titans of Adland hadn’t been themselves in years. These were brands that had run their course as global networks. Maybe then weren’t out of ideas but ideas by themselves are no longer enough. Adland suffers from a type of creative nostalgia that you don’t find in other industries. Maybe you find it in the music business. And that should give us all pause.

That’s because AI is to advertising what streaming was to record companies. The variable at work here is not quality, it is agility.  Creativity is quickening. The shift is from product to process, from doing to thinking, from making to shaping. We are approaching a Napster moment. If you thought adjusting to digital was difficult, strap in, this transformation will be the exact opposite of fun for you.

Oddly, the people you want around you are those experienced in dealing with change. The decapitation of agencies senior (as in age profile) leadership, the unmooring of the industry’s institutional knowledge in favour of young and cheap alongside younger and cheaper is the precise counter model to handling this wave of disruption, just gathering off Adlands coast. But let’s not conflate experience with the crumbling corporate edifices of another age. People are vital, agency brands less so. We need more experience. Fact.

Venerable agency brands have been led out to NYC-Corporate Daddy’s work-shed and dealt with by the accountants. And what daddy has brought back to the market is another hodge podge of letters, hyperactive, newly groomed and pissing on the carpet.

No, that’s unfair. Adland has always been a hodge podge of letters. This latest iteration is designed to create new names, new histories, new networks.  The next generation of agencies are no different in nomenklatura or desire. But that’s because it’s the people that imbue these collection of letters with significance. Because it’s the people, never NYC-Corporate Daddy, that show-up to do the work.

Whatever this period gets called, for us veterans in agency-land it feels like another chapter. Instability is a feature, not a bug of the game we play. Always has been. Always will be. It’s always been between the quick and the dead.

James Dunne is the strategy partner with Hyphen.

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