The China Vortex

Readers know that I have spent quite some time thinking about how the Internet and online advertising will affect the whole overall advertising industry. A recent post on Ogilvy China Digital Watch made me think more about how some of the changes the rapid rise in online advertising spending will affect the advertising industry as a whole.

The advertising industry grew at a time when the divisions and demarcations between different media and media audiences were very clear (TV, radio, print and below the line advertising). It was a good business, and permitted the ad agencies to buy large amounts of media, then resell it to their advertisers, while offering other services (creative, PR, direct mail, etc.) on top as value-added services. Advertising could be divided into brand advertising for global brands and more targeted ads for small local clients. All in all, it was a good service business with healthy margins.

That whole business model has been blown apart with the Internet, and ad agencies are adjusting to the changes. These changes are just starting, and will ripple out to affect other services as well.

The single greatest change brought by the Internet is the shortening of the business cycle. People have more things to do, which means that they need to make decisions, even important decisions, in much shorter time cycles. This means that if they want to find out something about a product/service, they want to know it in as short a time as possible.

This has been enabled by search, a business which Google has built to near-perfection. Add advertising to search results, and you have the Google money machine. Advertising appears in a welcome context instead of being disruptive.

Search advertising has had some negative effect on brand advertising because it is possible, in a very short time, to find out what others are saying about a given product or service. This is not the line from the corporation, but what other buyers are saying. More disruption of the communications process.

The immediate effect for ad agencies is that their whole time-cycle has been disrupted. Instead of the normal annual budgets and precious planning time which goes into big-budget ad campaigns, more corporate attention is going to fighting fires, which usually fall into the PR realm. The agencies are trying to protect their creative and media teams from this hyper speed development cycle in-house, but it is impossible to control what is happening on the advertising client’s side, who is getting continuously distracted by what sounds like noise and chatter.

What is the ad agency to do in order to adapt and survive?

First of all, it is necessary to tell the clients that it is no longer possible to control the message to the customers. The customers are talking back, and there is no way to tell them to shut up. A lot of the customer feedback is noise, but there are also very valuable pieces of information in there.

There is a need for a new kind of ad agency warrior who can go out there and slay the dragons , and collect the valuable information and give it back to the creative teams and client so that they can act on that information in its product and marketing cycle.

Here are my draft job requirements for an ideal candidate:

• Information researcher, able to use Internet and mobile tools to monitor client-relevant information in real-time;
• Able to engage with client at all levels (executive and manager) to understand evolving client needs, and to report in real-time on rapid changes in market situation;
• Able to understand client’s corporate position and voice, and act as a responsible spokesperson and advocate in the digital realm while upholding client’s integrity;
• Understands how to communicate to different clients on different levels and is able to quickly adjust accordingly
• Can quickly analyze and learn and communicate this information back to creative and media teams and back to client on a frequent basis;
• Proactively pushes out information to other team members and clients for their use;
• Comfortable working with amorphous teams which are changing on a constant basis;
• Is comfortable communicating in at least two human languages;

Requirements:

• More than two years’ blogging experience, including acting as an advocate for a product/service;
• Knowledge of SEO tools and terminology;
• Understanding of corporate structures and organizations and how they work, and how to get things done in them;
• Must love doing things fast and independently

Notice that I didn’t include academic credentials? I told you that we needed a new kind of ad agency warrior, didn’t I?

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