Influx

Ad agencies have learned to face up to a number of threats to their business from declining budgets and questions over media effectiveness by diversifying into new areas from direct marketing to design, but it now appears they face threats to their creativity from two unlikely sources;

1. From the highly publicized world of consumer generated media. This trend looks likely to reach a peak at Superbowl 2007, with both Chevy and Dortios airing consumer created spots during the game.

2. From media entities themselves that are either offering to create on behalf of brands or to put brand programs together through connections they have with artists, etc.

Some examples of this:

Flavorpill and Anheuser Busch

American Eagle and CW television for the aerie brand

WBTV’s new Studio 2.0 unit, that’s been formed specifically to develop content for brands

Overall, these threats appear to come from three different areas; artists who are looking for ways to commercialize their reputations, consumers who are looking to build reputations and from entertainment-based creative talent, whose skills have suddenly become more relevant as longer formats increase in popularity and accessibility.

Agencies need to step up to the plate and there are a couple of options here.

1. Clearly demonstrate and communicate their creative superiority-lots of good PR, awards and proof of the effectiveness of their work. Here, the AAAAs, One Club, Effies, etc could all play an important supporting role.

2. Provide access and give clients the ability work with consumers and emerging artists- start building production company competence and capability

3. Hire more diverse talent- look to hire from the entertainment industry

While ad agencies used to have a monopoly over creativity, this no longer appears to be the case. With media fragmentation and rising TV costs, agencies have been forced to diversify and compete in areas beyond TV, but it now appears that with branded, long form content and co-creation with artists emerging as areas of considerable client interest, agencies need to invest to stay competitive.