Digital Agencies Will Only Be Saved if the CEO is Your Client, Not the CMO
The agency’s client must be the CEO – and not the CMO
If digital agencies are to survive in a world where all advertising in going digital, the agency’s client must be the CEO – and not the CMO – the global boss of WPP’s POSSIBLE has said.
In an interview with Mumbrella last week, Shane Atchison, who oversees an agency network of 1,300 people as global CEO of POSSIBLE, said that digital agencies will become a thing of the past unless they can provide counsel beyond how to spend a media budget.
“To stay relevant, we have to share knowledge and ideas beyond a media plan and media spend,” he said, adding that 2015 was the year that CEOs really started coming to the fore to transform their businesses through digital.
“From all of my conversations, when I speak to CEO there’s a greater desire [to embrace digital], but then you get into the safe zones [further down the company structure in the marketing department]. I don’t think the barriers are in the technology or strategy. Between when the CEO is saying yes and the CMO, that’s where the challenge is,” he said.
Digital agencies might be called a different name in the near future, but their focus will be on the digital ecosystem and how to navigate it, Atchison predicted.
He was part of a phone interview that included Brandon Geary, POSSIBLE’s chief strategy officer, and Paul Soon, the agency’s regional CEO. Atchison noted that all three of them are all in their forties, and they’ve been digital practitioners all of their working lives.
“It’s a complex system and only getting more complex. The bias you hear from ad tech platforms in pretty extraordinary,” he said, suggesting that digital agencies can decipher the true value from the bluster for their clients.
Geary noted that the “ad tech explosion” has seen the number of firms in the space rise from 211 to 1,900 over the last few years, and clients need help navigating an unfamiliar landscape.
The conversations the agency is having with CEOs are about “digital products, incremental revenue streams, questioning how media is spent, and effectiveness,” Atchison said, who mentioned that he has written two books on accountability in marketing.
There is often a common gap between “what the goal was, what we did, and ROI,” Atchison said. “Somehow we get distracted from those principles.”
If digital agencies can stay true to an ideology centred around ROI, “we’ll prove the value of what we provide,” and more so than a traditional above-the-line agency that is “purely about the idea or the brand,” he said.
“If we can do that, we’ll be relevant for eternity,” he said. POSSIBLE is positioned is as a “creative agency that cares about results.”
Soon conceded that getting to the CEO in Asia is a different proposition to the US, where POSSIBLE’s global headquarters are. “In the US, CEOs have seen the light, they know what they have to do. The’ve had to figure out how to rebuild their businesses.”
However in Asia, where family hierarchy plays a key role in business culture, “getting access [to the CEO] is not always easy,” he said. “So for us it’s about getting the right clients.”
On how he feels traditional ad agencies are coping with the changing landscape, Atchison said: “I have a wonderful feeling when I hear an ad agency head say they now understand digital. We are 110 per cent focused on this topic. We’re confident in what we provide. But we don’t claim to we have it figured out.”
Soon, who joined POSSIBLE in January after almost a decade with XM, now Mirum, added that he hadn’t seen traditional agencies in Asia make “big moves to change” or become more relevant, even though there’s been a major conversation around the need to evolve the last five years.
He said that he recently interviewed a senior candidate with one of the “better” traditional shops, who shared that his agency had been “trying all sorts of partnerships, but they still don’t know how to activate.” Traditional agencies “might stumble upon great piece of work”, Soon said, but lack consistency.
On the notion that media agencies have been delaying recommending moving spend to digital, as they make bigger margins buying traditional media, Atchison said that if the CEO is the digital agency’s client and not the CMO, “then you’re there before the media agency has the money, so you can be more objective about how it is spent. It’s more difficult when the spend has already been allocated,” he said.
On the agency’s ambitions for the year ahead, Atchison said that POSSIBLE wanted to be known as the company that “solves really hard problems,” but added, “we don’t want to be lost on whether they’re traditional or digital.”
POSSIBLE would be “doubling down on collaboration” in the year ahead, and would be going after m-commerce more than other agencies, he added.
Article originally published on Mumbrella here.