The Future of Digital Isn’t in Advertising

  |  March 9, 2014   |  Comments   |  

It's not enough to tell a compelling story. You need to provide easy access to behavioral change and that's where the true value of digital comes in.

It’s been exactly a year since I wrote this article – "The Digital Agency of the Future." The article fueled a certain amount of discussion for me and set some wheels in motion.

One year later, I’ve left my role as a digital strategist at a big ad agency and set upon a path to affirm what I believe would be the future of digital. This future doesn’t really involve advertising all that much. Opportunities have always abounded for creative professionals to affirm their own ideas – if you truly believe in something, you have to take risks. It’s what we always tell our clients and it’s only right that we start putting our money where our mouth is.

But less about me first and more about what got me here: The role of advertising has always been about solving brand problems - by changing the way consumers think, feel, and act. The issue as I see it is that advertising has become a very outdated model to solve these problems. Things haven’t changed for a long while. The construct in the old world of advertising was meant to solve the issue of product parity. In those days, because there were so many alternatives, you couldn’t simply just talk about your product benefit alone. You had to connect on a deeper and more emotional level with your customers through storytelling.

However, in this new world of digital, you can’t merely tell a compelling story anymore. To change consumer behavior, you need two essential ingredients – an emotional connection and story that provides the motivation for change, and secondly (and more importantly), an easy access to the behavioral change. Advertising does the first part very well but unfortunately stops short. We tell people a great story about why they should not drink and drive or why they use our credit card over cash but we never provide them with an easy way to change their current behavior.

To me, the true value of digital has always been about making useful things - products or systems that help people and make their lives better. The old adage that puts the consumer first; not the brand. Winning customers over with a great product beats trying to win them over with great advertising. Best if you can do both obviously. Telling a great story alone is superficial - to make it sustainable, you need ideas executed in a way that it is built to evolve and grow over time, not die after a three-month campaign period.

Case in point: The recent $19 billion dollar acquisition of WhatsApp by Facebook or the more than $1 billion Google paid for Waze.

WhatsApp disrupted the telecommunications industry costing them millions of dollars in lost SMS revenue. However, it also revolutionized mobile communications, allowing people to connect with their loved ones anywhere and send texts without worrying about monthly SMS limits or overseas carrier charges. It was also a life-changing experience for most people. Who remembers what life was before group chats?

But at the same time, it heralded the rise of mobile data usage, which became a key revenue driver for telecom providers globally. What if an agency had built this for their telco client?

The analogy is simple: If you do great advertising, you get paid a retainer and maybe win some awards. If you build something useful that grows over time, you get bought over for over a billion dollars. That is sustainable value.

Where do we go from here? In my article from a year ago, I talked about how agencies needed to have their own innovation labs, where they could incubate ideas and tinker with new products that could either be monetized directly with consumers or used to help solve client problems. That was the path taken by many now more famous products – Threadless, MailChimp, and HootSuite all started from within agencies and moved on to become companies of their own after their side projects became super successful.

There is an interesting Creative Mornings talk by Jim Coudal that speaks of how his agency made the transition from client work to fully focusing on their own products. It was never an overnight change but a concerted effort to treat every side project like a client so that it didn’t get left behind amid all the other more urgent client work. What he found was that with every successful product idea over time (and of course, they had their fair share of failed ideas), he was able to replace an actual client. And over time, they found themselves focusing on their own products full time instead of client work.

So where does that leave me? I’ve since started my own product development studio and in the last few months of rapid prototyping and iterations; we’ve launched our first product Lensy, a social community and marketplace for everyday photographers to feature and sell their photos to brands that need stock photography. The idea came out of a problem we had in advertising in Asia, which was the constant challenge of finding great Asian stock photos from traditional stock libraries that were based in the U.S. At the same time, we wanted to democratize stock photography by allowing photography enthusiasts to grow their craft while being able to monetize their passion. For brands, Lensy would provide a low-cost way of getting unique Asian photos for their marketing needs without the complicated licensing or enforced subscription plans.

I’m honestly not sure if this will work; nor do I have the lofty aspiration of trying to change the world. I’m merely taking action on my point of view and doing what I think is right by changing my status quo. Hopefully this real-life experiment with risk and hard work pays off. If not, there’s always going back to advertising.

Watch this space.

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Vincent Teo

Vincent is the co-founder and partner at C//IQUE, a product development studio and incubator that focuses on developing digital products and services that disrupt traditional business models and empower consumers. He has over a decade of experience both on the client and agency side, most recently as a digital planning director at BBDO/Proximity and lead digital strategist at Publicis. Prior to that, he started-up and managed the Hong Kong office of Splash Interactive Group and built the online business at Citibank and HSBC. Connect with him on Twitter @intersphere.

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