What Challenges Do Agencies Face in 2015?

According to some agency higher-ups, the quickly-growing digital space calls for constant innovation.

When we look back at the past few years, it’s hard to believe just how far the digital marketing industry has come. Snapchat was merely a tool for teenagers with little value for brands, wearables were all about cool clothes rather than connected devices, and Apple Pay did not even exist. As the landscape continues to evolve it seems that change is the only constant, leaving agency leaders with a continuous challenge to stay relevant in order to better assist their clients.

Are agencies taking the time to evaluate their business against the ever-evolving landscape and consumer demands? Are they reinventing themselves and their processes in order to keep up with the significant shifts in spending marketing dollars? And if they are doing these things, what challenges are they facing along the way?

A survey by ClickZ’s U.K. sister publication .rising and information solutions provider Deltek calls for agencies to share their thoughts on the state of the current creative agency landscape.

The questionnaire covers things such as agency size and pricing, as well as emerging trends and current issues faced by creative agencies. According to Pat Frend, president of the U.S. East region at Razorfish, one challenge is that customer behaviors are changing so rapidly. Because marketing has become more about experiences than advertising, it requires a broader set of expertise on the agency side, particularly regarding technology.

“Successful marketing these days starts with social first, and it’s really got to fit naturally into people’s behaviors on a lot of these social platforms in ways that don’t turn people off from the experience of a brand,” Frend says. “Trying to thread the needle to create something that stands out in people’s personal digital spaces, that’s where the real magic happens.”

Frend adds that data is – or should be – another focus for agencies going forward. Earlier this month, Razorfish appointed a chief intelligence officer. There’s so much data out there that having data is no longer the priority; it’s now about building an ecosystem to actually leverage that data.

“The lines between media and advertising and social experiences and what we term ‘owned experiences’ – website, mobile apps, mobile sites, digital installations – are blurring across all of those dimensions,” Frend says. “The demand to create solutions to leverage data, to connect with consumers later and to also mine that data for business insights is becoming incredibly more complex.”

The complexity of data mirrors the complexity of the entire industry, according to Jeff Steinhour, partner and vice chairman of Crispin Porter + Bogusky. As the world grows increasingly digital, more brands are branching out from the traditional agency of record (AOR) relationships and working with more specialized agencies that only focus on areas like digital or social. While this gives smaller agencies the chance to do more brand work, it does disrupt AOR relationships.

For large agencies like CP+B, staying competitive means a greater focus on coming up with engaging content. This is also crucial, given the volume of content out there.

“Getting messages in front of the right audience at the right time is still the name of the game. There’s just a lot more places to try and intersect them,” Steinhour says. “The fact is, people are so inundated with messages and content from news to entertainment to social feeds to everything else that the wear-out factor is much greater than it used to be.

“You have to embrace innovation, which is difficult,” he adds, citing Domino’s emoji ordering as one recent example. “Human nature is to push back on change; change is scary. But you have to.”

Steinhour says larger agencies have the resources to cope with the changing industry. He believes small and mid-size agencies are the ones who will struggle most.

For Deacon Webster, chief creative officer and owner of Walrus, an agency’s client list matters more than its size. Though Walrus only has 20 employees, the New York City-based creative agency has done work with big names like Emergen-C, Staples and Amazon.

“To keep up with the trends, you just need someone who’s willing to take a chance and experiment,” Webster says. “If anything, it’s the opposite because we’re able to generate content really quickly for a lot less money than the big guys. If you’ve got 55 layers of creative directors, there’s no way [something experimental] is ever going to get in front of a client.”

Like Frend and Steinhour, Webster agrees that ultimately, agencies’ biggest challenge is keeping up with the rapidly-changing landscape.

“People are watching ads vertically on Snapchat because that’s how you hold your phone so suddenly you have to reformat everything to be a completely different shape,” he says. “Everything has its own rules and you have a really limited budget in digital. How is it possible to make quality content across all those platforms and more?”

He warns of the dangers of not having an experimental budget set aside to try new things. Brands that fail to do so find themselves getting on Instagram well after it’s become popular.

What challenges is your agency facing? Please let us know by completing this survey.


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