It’s Time to Be More David
Bigger is better. Let’s think about that, shall we? When you want to go to your local high street, are you more interested in going to the passionate barista who just set up her own coffee shop, or the Starbucks, over the road? Similarly whether for art, design, clothes, bread or meat, pretty much anything where quality or uniqueness are desired, the ‘artisan’ is usually a more attractive proposition than the generalist franchise.
David vs. Goliath
By Nick Price, MD (UK) & SVP of Platform Operations at Edisen
It is much the same with marketing. The true trailblazers in the space rarely begin within the established agency groups. They must be bought. This has always been deemed to be a good thing – the group in question obtains a new talent and grows a little; the entrepreneur gets a pay out and a greater degree of security, before ultimately leaving. Often to start something new.
So it has been for the last four decades for the holding companies, and it’s been a strategy that has served them well. Big brands need big partners. And large, publicly-listed holding companies need constant growth, which they achieve in two ways – their scale buys them business, and they acquire. But what if things are changing? What if big is no longer beautiful? What if brands are discovering that the holding companies are, in fact, wasteful, and inefficient, and – even worse – uncollaborative? Certainly, that suspicion seems to be borne out by an interesting trend for brands to ask for smaller specialists rather than generalists in their pitches.
There are two things at work here. For years, brands have sought security in scale that offers a turnkey global solution, but they are discovering that that scale comes at a cost. Fundamentally the holding companies are held back by the thousands of P+Ls that they run. Each business is managed and evaluated against them, which breeds a culture of internal suspicion and competition. Why give work to your sister agency in New York, if you can cut them out and make the money yourself? Even if it’s not in the best interests of the client.
The second thing is culture. The large groups have powerful cultures within them that they are encouraged to follow to make sure they don’t tread on the toes of their sister agency in an aligned field. This tried and trusted process runs so deep that it is almost impossible to change it, which means that even if they could dissolve all those silos, trying to create a single collaborative entity out of the whole would be almost impossible. Of course, they try to create ‘bespoke’ agency groups for their clients to answer this problem. But scratch the surface and all too often what you find is an agency in name, made up of a collective of owned agencies, still working to the old ‘muscle memory’ they learnt driving revenues back to their original parent. It sounds great on paper, but it’s a far from perfect solution for the global brand, requiring a global agency.
This is why S4 is so interesting. It was easier, one has to assume, for Sir Martin Sorrell to leave WPP and set up S4 than it was to change the giant he built on the old model from within, and if their growth is anything to go by, his strategy is working. A prediction I would have is that more and more of the smaller groups and players – ourselves included – will shed the shackles of multiple P+Ls and inflexible cultures, to solve this very problem.
However, there is a key component missing. It’s not just financial accountability and culture that come into play here. The real gamechanger is technology. Like never before, and ever more now thanks to Covid, new ways of working are emerging. We are beginning to see a world where class-leading tech can offer something different. Where a brand can buy into a smaller entity but explode out into a network of best-in-class suppliers, all collaborating for the greater good. We believe in this to such an extent that we recently re-branded to a single name built around our own tech – Edisen. In a Meta world, not only will the agency of tomorrow need class leading collaborative and production tools, they will also need to include state of the art AI and machine-learning along with access to high end CGI, gaming tech and virtual production techniques, all married in with that magical bespoke approach that we love in marketing.
So, next time an agency shows you a chart that talks about having 500 offices and 60,000 staff, ask yourself this: does that scale buy me a better solution? An eco-system designed for my needs? Or is it just a very inefficient and very expensive model that is slowly becoming obsolete (but, granted, looks impressive)? It still takes a brave brand to buy into the company with only 20 offices and 1000 staff who can promise the same reach and better effectiveness than its larger cousins, but that is the landscape that is coming. It is inevitably within a fusion of tech and creative that brands will find the solutions to their issues. How do you create better, more relevant consumer experiences at scale that are both effective and affordable in any other way?
It’s really the story of David and Goliath. Everyone bets on Goliath, it’s the sensible thing to do after all. But think about this. David has technology at his disposal and knows how to use it. Goliath, on the other hand is hindered by the very thing he is known for – his size. So, every time Goliath, with his oversized muscles and large sword comes lumbering towards David, he’s going to lose. Every time. Of course, in the real-world Goliath will probably just buy David, but I don’t think it will be before our metaphorical David has managed to change the rules of the game. Either way, there is still no genuinely, properly integrated, seamless offering for clients today, but there will be soon. It just won’t be from the people you expect.