Big data is certainly ‘The Big Story’ at the moment. It seems that just about everyone has an opinion on how it will impact marketers and agencies and who the likely winners and losers will be. And in this case the buzz is justified.
Over a decade ago Gartner recognised and coined the phrase the ‘knowledge gap’; our increasing inability to analyse the amount of data generated. But a decade later this gap has been eradicated. We now have the technology to record, store and analyse unfathomable amounts of data. It is now incumbent upon us to acquire the skills, develop the methodology and align our business models to harness and execute against this new found knowledge.
And the prophets of doom that predict many traditional agencies will struggle with big data most certainly have a point. It is going to be an evolution and adaption of epic proportion for many agencies to meet the challenge. But for those who do make it the rewards will be great as many competitors will fall by the wayside and the market will inevitably consolidate.
Whilst the end game that we all continue to strive for remains the same; using all available data to put the right message in front of the right person via the right medium at the right time, the way we play the game changes exponentially. The ability to individualise targeting, real time delivery of messaging and the capability to pre-empt buying decisions, requires vastly different skills and significantly transforms the value chain along the way.
I fully believe, and the decisions that we are making reflect this, that we are – to borrow Andy Grove’s phrase from “Only the Paranoid Survive” (how apt for our business!) – at a strategic inflection point in our industry. That is, we are at a point in the life of a business when its fundamentals are changing significantly and those who don’t act decisively and adapt appropriately will fail.
One of the key changes will be who and how we recruit in order to support the new value chain. There is already a skills gap in the marketing sector but we envisage a whole new layer of previously undreamed of professionals in our business. It is not a question of ramping up and evolving current social media and data capabilities. It is a question of fundamental transformation.
We see a wholesale and absolute shift in who we recruit. Think physicists, actuaries, bond traders, engineers, mathematicians, computer game developers/coders, and designers in addition to dynamic creatives. A new agency creed to support and anticipate the needs of the new enterprise.
It is also critical to remember that with any change in the value chain there must logically be a change in the value itself. The Commonwealth Bank’s chief marketing and online marketing officer, Andy Lark, recently raised concerns in AdNews about how the agency sector might struggle with big data adding “so many of our agency models are built around quite traditional structures so it is hard for them to rethink their entire business model”. And there you have it. If indeed agencies, as they will, have to ‘rethink their entire business models’ then the way that they are remunerated will also undergo significant change.
The historic model based upon first media spent, then FTE’s of those spending media dollars, will require further adaptation as the agency not just of the future but of the here and now, deliver high end technical recommendations that were once purely the domain of corporate consultancy firms.
So. Big data means big changes for marketers and agencies alike and the change is going to happen quickly. It may be hard for some both inside and outside of the industry to accept that what may have stood for many years has to change but those that resist will lose short term relevance and face possible long term extinction. We have already begun to equip ourselves for the road ahead of us and accept that data-driven decisions tend to be better decisions. Gut feel leaders who purely rely on their past experience will either embrace this fact or be replaced by others who do ... It is going to be an exhilarating and intellectually stimulating journey. My favourite way to travel.
Chief Executive Australia and New Zealand
Omnicom Media Group
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