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Guest comment: The evolving role of agencies in our changing adland

January 8, 2018

If brands are taking the reins on their marketing, how do agencies fit into the picture? Ilona Lubojemska, Director, Client Services at The Trade Desk, takes a closerlook at the changing role of agencies in 2018.

Following the brand safety furore earlier this year, and amid continuing industry concerns around fraud and transparency, it seems 2017 has been the year of change in adland. The World Federation of Advertisers (WFA) confirmed as much with its latest research, which suggested that brands have either already shifted or are planning to shift their approach to marketing. Two thirds (65%) of brands have strengthened their in-house marketing capabilities while a third (35%) have improved their media knowledge through internal training.

The upskilling of brands’ marketers has prompted a whirlwind of speculation about the future role of the media agency. If brands are taking the reins on their marketing, how do agencies fit into the picture?

Programmatic pulls ahead

With the huge growth in programmatic spending – £2.71 billion in the last year in the UK, or 72% of the total display ad spend, according to the IAB’s digital ad spend report – it’s no surprise that many big brands want to bring their marketing teams closer to their programmatic strategy. And according to the WFA, almost a fifth (18%) of brands have employed an in-house programmatic expert in the last year, with a further 18% looking to do so soon.

These hires show that brands are taking programmatic seriously. After all, it is only sensible that they have the knowledge in place to guarantee they are asking the right questions and making the most of what programmatic can offer.

But many industry spectators have extrapolated these in-house hires to equal the end of the media agency. This simply isn’t the case – far from replacing the technical know-how that agencies pride themselves for, this increased programmatic expertise complements it.

The adaptive agency 

Media agencies are in a unique position. They combine years of industry experience, technical expertise and specialist skills. On top of this, they are exposed to and interacting with new industry developments in a way that neither brands nor consultancies can do – while achieving economies of scale that an in-house team could only dream of. For a brand to achieve the level of service they receive from an agency, they would need to spend big in-house – and it is likely they would still be left with gaps.

But, with the brand safety scandal sending shivers up any CEO’s spine, digital advertising has worked its way up the agenda of many c-suites. And with this shift comes the opportunity for agencies to assume a more consultative role. By offering their expertise in a more strategic way, many agencies are becoming more involved in conversations at the top and helping to build campaigns right from the start.

And while we keep hearing about big consultancies making a move into digital marketing by gobbling up smaller agencies, agencies are already a step ahead with their consulting offers, circumventing the potential threat posed by these firms.

Delivering on data

As well as expanding into consulting, many agencies are also developing into back channels for data aggregation.

In this new age of marketing, data is at the heart of everything we do. And brands are catching onto the fact that they are sitting on a mountain of their own first-party data – arguably the most valuable and useful data there is.

According to the WFA, 38% of brands have added clauses into their media agency contracts to secure sole ownership of their data, and a further 24% have plans to do so. Again, many in the industry have interpreted this as a sign that brands are pulling away from their agencies.

This is wrong. Brands are merely waking up to the power of their data and stopping it from sitting redundant. They are partnering with agencies to make sure their data is being used to target the right people, with the right messages, at the right time. Hopefully, in time, all brands will learn to trust their agencies to use and interpret data for them.

Agencies look forward 

Brands’ appetite to play a bigger part in their digital marketing strategy should be celebrated, rather than feared, by agencies. After all, it presents a perfect opportunity for agencies to evolve and become more holistic in the way they work with their clients.

And the whole advertising ecosystem can benefit from this more collaborative relationship, which naturally encourages more transparent communication between all parties. Meanwhile, with greater transparency comes greater trust – and as brands trust their agencies to manage their data, we’ll see smarter, more accurate targeting, leading to better executed campaigns. And – as we all know – effective advertising makes a happy brand.

By Ilona Lubojemska

Director, Client Services

The Trade Desk

Ads advertising, agencies, brands, digital marketing, marketing

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