There was a time when media and creative worked together in the advertising agency. But those days are long gone. Today media and creative are found mostly in separate and often automatous businesses. Yet, there is a trend of some creative agencies offering media planning and sometimes buying and media agencies offering non-media services like creative content. Does this mean that creative and media and being put back together? Find out the state of play here in Media Minutes.
DARREN: Welcome to Media Minutes. I am Darren Woolley STEPHEN: And I am Stephen Wright DARREN: In the next few minutes we will share with you our view on putting the toothpaste back into the tube. Stephen, did you recognise the Harold Mitchell reference? STEPHEN: Yes, Darren. When the owner of Australia’s largest independent media agency was asked if media and creative agencies would get back together, he said you can’t put the toothpaste back in the tube. His way of saying it cannot happen. DARREN: Yet, Stephen, we are seeing an increasing number of creative agencies offering media planning and occasionally buying services and claiming to be full service? STEPHEN: Yes, Darren, I am glad you said claiming, because while a small handful of agencies are offering media services with their core creative offering, these are often through a buying arrangement with one of the major media agencies, usually a network agency. DARREN: Well it is still media services, Stephen? STEPHEN: True, Darren, but not at the same level or with the same advantages that the larger network and independent media agencies can offer. You have to remember that unlike creative and digital agencies, media agencies have a high cost of entry to secure all of the services required to provide a full-media-service. These costs are the traditional ones such as syndicated media research and the investment in technology to perform in the digital and social media space. DARREN: Good point, Stephen. But the media agencies are also adding other services to their offering, right? STEPHEN: Correct, Darren. Most of the media agencies, particularly the major network agencies have been investing in either acquiring or building additional non-media services into their offering. Some of this is sponsorship management, content and production capabilities and even creative services. DARREN: They have kept that under reasonable wraps then. STEPHEN: In some cases, the larger media agency groups are today making as much money from these non-media services as they make from media related fees. DARREN: Is that because there has been such a heavy downward pressure on fees? STEPHEN: Partly, Darren, but also because media agencies have realised that there are an increasing number of services that are more convenient if provided by one agency. An interesting one is the increasing number of media agencies that offer content and production. DARREN: Why are they not telling more people about these services, Stephen? STEPHEN: Part of the problem, especially those media agencies owned by a holding company, is that the holding company also owns creative, digital and production services agencies and that these offers are in competition with those. DARREN: Anything else, Stephen? STEPHEN: Well the other part is they are inclined to go about quietly offering these services to existing clients and consolidating their position with the client, rather than making a big fanfare of winning the business in a pitch. DARREN: It makes sense, Stephen. The number of times advertisers have complained about the cost and the time it takes for their creative agency to provide the multitude of creative versions needed for their digital and social media campaigns. STEPHEN: That is exactly where these non-media services come to the fore. It is a way for the media agencies to provide the convenience of what is often referred to as a full-service agency to meet the needs and expectation of their clients. DARREN: So, Stephen, with creative agencies adding media and media agencies adding these non-media service, in many ways the toothpaste is going back into the tube? STEPHEN: That’s right, Darren. And it is not just there. Those clients that are taking creative and production in-house are also taking media in-house, particularly performance media. This gives them the opportunity to align the two internally and access externally the creative and media support separately. DARREN: Fascinating, Stephen. Where will it end? STEPHEN: The fact is, while it is certainly an advantage for some advertisers to have media and creative together, others prefer the two to remain separate. And likewise, the holding companies who have invested heavily in building and acquiring media and creative agencies brands do not appear to be in a hurry to combine them. So, for now this is it. DARREN: Thank you, Stephen. And to keep your advantage, make sure you subscribe to Media Minutes. A weekly snack on all things media. Until then. I’m Darren Woolley, and he’s STEPHEN: Stephen Wright TOGETHER: And this is Media Minutes.