AMG panel to hold debate: 'Will consultancies shake up the agency world?' Aug 3 in Sydney

Screen Shot 2017-07-25 at 7.44.49 am.jpgThe AMG is set to hold a debate featuring PwC CCO Russel Howcroft called 'The Gloves Are Off': Will consultancies shake up the agency world? on Thursday, August 3, 6:30pm-8:30pm at The Monkeys, 531 South Dowling Street, Surry Hills.

The lively debate will be moderated by Al Crawford featuring experts on the subject including Dominique Hind, COO and co-founder, WiTH Collective, Mark Green owner, CEO, The Monkeys and Fran Clayton, CSO, DDB Group.

As consultancies start to make major forays into the traditional agency space, what are the implications of their recent spending spree on agencies and people?  How disruptive will they really be? And how are agencies responding?

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Why bother asking? said:

'The Gloves are Off. Will consultancies shake up the agency world?'

Why bother asking? They already have.

When a management consultancy pays nearly 30 X for a business that most agency holding companies would struggle to pay 6 X for has definitely 'shaken up' the agency world'.

Not all consultancies are interested in a full creative services offering like Accenture, but they all want marketing client's digital/data business.

Anyone who argues that the agency world hasn't been shaken up is living in another universe.

So, why bother asking? The horse has already bolted.

Steve Dodds said:

I've worked in this business for a very long time.

All sorts of things were supposed to 'shake up' the agency world. Although Shake Up is kind of nebuous.

Some, like the death of commissions, did.

Others, like the rise of funky independent shops, didn't so much.

The agency model, whatever its limitations, has proved remarkably long-lived and fairly adaptable.

I suspect there won't be any massive short or medium term difference between Accenture buyingg the Monkeys or say Omnicom. Just as Photon buying BMF was not different than the hedge funds who bought agencies 20 years ago.

Look at Facebook. It was supposed to revolutionise the industry, but in reality is becoming more like the businesses it was supposed to disrupt every day.

What steve said said:

I remember media moving indipendent, out of agency. That was meant to shake the paintings off the walls. Course, all it did was move the goal from being as effective as possible to being as lucrative as possible (Hamish and Andy radio activation for your FMCG / car brand / funeral home, anyone?)

I remember when digital was going to be all and all the rest was going to become nothing. Guess what? Ugly stepchild OOH is now the single most effective way to push a message, in this short attention span world that digital has spawned.

There are so many examples, but the bottom line is that the next big thing is rarely as revolutionary or as big as predicted. And the consequences are always completely unpredictable.

We try so, so hard to overcomplicate what we do. Perhaps we think clients respect this - and perhaps they do. But it's still the same job at its core, which comes down to a couple of mooks sitting in a little room (or in open plan with noice cancelling headphones on) smashing their heads into a brief with the loaded gun of a deadline pressed against their temples.

Everything else is just heirarchy and structure. No ideas, no business.

Why bother asking? said:

Steve is mostly right, as always. However, I think the difference now - as opposed to new ad agency models, media buying agencies offering creative services etc - is that the consultancies are targeting clients marketing budgets, especially planning and digital. For instance, PWC mightn't want to offer a full suite of creative services like Accenture with their purchase of the Monkeys, but they are aggressively targeting clients digital work. And any agency thinking of selling now has an alternative to agency holding companies as a prospective purchaser.

The scary part said:

Marketers are some of the dumbest people on earth, who will jump off a cruiseliner onto a burning canoe if someone tells them that it's the next big thing.

There's almost no doubt the proud ranks of soulless spineless braindead sheep will jump at the opportunity to give their marketing budgets to companies that don't really specialise in marketing. Because that's just the sort of thing they do.

I predict that this is going to take a huge chunk out of agency budgets, but it won't be very long before these companies start snapping up advertising creatives, when everyone realises that big data is nothing without a bit of lipstick on.

Why bother asking? said:

Dear What Steve said:

Agencies didn't die with the end of accreditation because the revenue still stayed in the family.

For instance, when Clemenger lost its media revenue it went to UM, which is still a Clemenger Group company.

And when digital was going to be the next big thing, most of the digital agencies still resided in traditional agency holding companies.

In other words, most, if not all of the examples you mention in your comment, simply meant revenue shifted from one part of an agency group to another.

The difference here is that the revenue is leaving agency land and going elsewhere - to management consultancy land.

That represents a huge change - and if ever you needed proof of how big a change - just 'Follow the Money'.

What Steve Said said:

Totally see your point, but don't forget that a lot of those media companies and digital agencies were independents that the big agency groups bought over time.

Many of them cut into traditional agency budgets in the beginning. But agencies survived because people still needed ideas.

I'm not saying it's going to be easy, or that it isn't going to have an impact. Just that the end result will be unpredictable, and the impact might be smaller than anyone thinks.

This may just be wishful thinking, but only time will tell.

Why bother asking? said:

Dear What Steve said,

Below is part of a new PR release from KPMG today which better demonstrates that the 'shake up' is real. Creative departments mightn't recognise it yet, but the agency principals in charge of the purse strings certainly have.

Launched last month, KPMG’s Customer, Brand & Marketing practice now has a combined team of 46 specialists, including 7 partners. Its suite of services include customer experience strategy, customer experience design, customer journey, sales and channel transformation, marketing and product transformation, service transformation and customer insights. KPMG is actively expanding capability by pursuing acquisitions, and recruiting more specialist talent.

Captain Obvious said:

There is one key difference.
Agencies are hired and fired by the people who work for the consulting firms C suite clients.

Captain Obvious said:

There is one key difference.
Agencies are hired and fired by the people who work for the consulting firms C suite clients.

The champion of democracy said:

They could probably use our help.

Very smart people... said:

That Monkeys multiple is utterly awesome - whoever negotiated the deal realised that there is a really cut throat race on between the big consulting firms to tap the rich vein of marketing spend.
Be aware, friends, that the big firms are full of really smart people. If you read this blog then they are smarter than you. All of them.
As soon as the CMO got a larger IT budget than the CIO, they got interested. They're after the really big spend items - this foray into the creative area - hires like Howcroft and purchases like The Monkeys - is just the door they've chosen to enter the space. They realise that the serious money over the coming decade will be made by those able to deliver a convergence solution out of customer and lead data mining, extreme media channel divergence and tailored customer journeys.
The things you see before you are just chess pieces being placed on the board. They aren't even playing yet.

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