In many ways, South Africa is a very different place than it was a year ago; that’s as true for the advertising space as it is in the political arena. There’s a sense that things are happening, that change is in the air. But tempering any optimism is a lingering sense of uncertainty, brought on by the knowledge that any change will take time.
This makes it difficult to be completely certain about what’ll happen in the broader marketing space in 2019. There are, however, a few emerging local and international trends that look set to have a big impact going forward.
Holding company consolidation
Over the last decade or so, advertising’s big holding companies — with WPP, Omnicom, and Publicis Groupe at the top of the pile — have undergone a period of rapid global expansion. Many South African agency founders, especially in the digital space, earned some pretty big paydays as a result of this expansion.
There are, however, signs that this expansion is slowing down and that the holding giants are about to enter a phase of consolidation, especially as big brands take a closer look at their marketing budgets, and the unlocked potential of data. WPP in particular looks to be taking a much more cautious approach in the wake of Sir Martin Sorrell’s departure.
Yes, there is data compliance to look at, but brands have been spam smsing and emailing us for yonks; it’s time to start using data and technology to talk to customers like real people online.
The rise of the media consultancy & media tech
Brands won’t be left to their own devices when it comes to investigating those budgets, either. A new wave of media consultancies is emerging, not only to help them figure out where their money’s going but how to spend it better, too. The founders of many of these consultancies are actually veterans of the advertising space who’ve grown frustrated with how murky media buying has become. Fuelled by a determination to give brands more control over their messaging, they are results-based and so don’t have to justify bulky retainers the way traditional agencies do.
Perhaps the clearest sign that they will play an influential role in the marketing space comes from the prospectus for Sorrell’s new company, S4 Capital. The document lists the venture’s primary competitors as “consultancy businesses with an emphasis on technological services in the digital marketing arena” such as IBM iX, Accenture Interactive, Deloitte Digital, and PwC.
Digital media is becoming specialist and it’s the large media business that’s struggling with the rise of machine-learning media technology, transparency and results-driven models.
No mention is made of the likes of Ogilvy, JWT, or Grey.
What’s clear is that Facebook and Google technologies are growing at such a rapid pace that South African media agencies at large DON’T know how to fully use this technology, and often outsource work to foreign entities. Opportunities exist for brands and agencies that fully embrace media tech and use it to its full potential, thus achieving optimal digital, what I like to call “people-based marketing”, that notion of talking to customers like real people like individuals.
Increased focus on brand safety
In the pre-digital era, very people would’ve noticed if a company’s ad appeared in a publication that didn’t fit with its values. But, today, brands can advertise on websites and other digital properties without even knowing about it. Sometimes this has massive consequences. The last thing any brand wants is for its creative to appear on a fake news site or the YouTube channel of a proud neo-Nazi.
Some industry players will tell you that programmatic advertising means it’s inevitable that these ads will end up in places they shouldn’t.
Brand safety only becomes an issue when programmatic advertising is implemented badly. Done well, it is safe and produces real results for brands.
As brands become more conscious of where their ads are seen, they’ll quickly gravitate to the outfits which can guarantee them safety or bring this expertise in-house.
The end of big retainers?
With technology enabling brands to take increased control of their marketing, the relationships they have with their advertising agencies are likely to change. Creative campaigns won’t disappear entirely but, as marketing moves from the masses to the individual, they’ll become less necessary.
And idea needs to be ground-moving; creating simple content that doesn’t fit the media space is over. We need dynamic content that is driven programmatically to real people. Creating content should be cheap, thus leaving more spend within the digital media space.
Performance media models will become the norm as we start moving into a space where media will lead creative agencies, a trend that is already starting to emerge within the global Publicis Groupe. As a result, creative agencies may well find themselves getting fewer retainers and more individual campaign-based work. The only survivors will be digital media specialists, because always-on will apply here.
Ford’s decision to fire WPP after 75 years, as it looks to cut down on a marketing budget worth around US$3bn and focus on digital, is a clear sign that this is the direction brands will increasingly go in.
All of these trends point to the fact that advertising is undergoing a massive change. Those who adapt will survive and may even thrive. Those who fail to see what’s going on around them may soon find themselves wondering where it all went wrong.
This article was first published by marklives.com on the 18th January 2019.