Agencies: 15 Risks You Can’t Afford Not to Take
Viewpoint: Forget the Recession, This Is No Time to Ignore Changes to the Agency Business Model

By  Tim Williams founder of Ignition, a consultancy that works with marketing communications firms to help them create and capture more value.

(excerpts from the  full article, linked to above,  arereproduced here for your convenience)

…As every informed agency executive knows, we’re at the nexus of the Great Recession and the Great Transformation of Marketing. In circumstances like these, a strategy of “just try harder” won’t take you very far.

Economists are always talking about types of risks you can afford and the kinds you can’t afford to take. For those of us in the agency business, the latter bucket of risks is mostly about failing to adapt to the dramatic changes affecting the agency business model.

Here are 15 things agencies can’t afford to risk.

1. A skill set built mostly around interruption instead of engagement. Agencies are used to delivering exposure for their client’s brand messages, measured by things such as reach, frequency and cost per impression. With the consumer firmly in control of his or her media-viewing choices and habits, no amount of exposure matters if nobody’s paying attention. What agencies sell — or should sell, anyway — is engagement. The metrics of engagement are completely different from the traditional media measurements of the past, including attentiveness, receptivity and buzz potential. Exposure is about efficiency. Engagement is about effectiveness.

… 3. Core competencies focused on “one to many” instead of “one to one.” Lots of agency professionals have an irrational fear of data and databases, even though the future of marketing clearly revolves around understanding how to leverage that information. Thanks mostly to the internet, mass audiences can now be identified and targeted in ways that make much better use of marketers’ money. Agencies need to move from mass messaging to mass customization. Agencies know broadcasting, but must now learn narrowcasting.

4. Creating brand-to-consumer communications at the expense of consumer-to-consumer communications. The agencies that grew up in an era of controlled communications now have to learn how to serve their clients in a world of open conversations. This requires a very different skill-set and service offering. It also means moving beyond consumers as audience to consumers as media.

…6. Production systems that are linear instead of organic. Most agencies still have a straight-line approach to production, based on a legacy system of trafficking work out the door and then moving on to the next job. But in the digital world, most jobs never die. A website is never done. Online campaigns can be constantly monitored and optimized. Agencies must adjust both their workflow and compensation systems to accommodate production work in real time.

7. Developing media plans instead of channel plans. The view of progressive media professionals is that everything is a channel, and what’s really needed in place of the conventional media plan is a holistic channel plan that potentially includes all three major forms of communications channels: bought (paid media), earned (non-paid channels such as viral videos) and owned (channels owned by the brand itself, such as online properties, employees, stores, etc).

8. Placing media instead of creating media. Quick, name a headline created by Crispin Porter & Bogusky? Chances are you can’t, but this firm is considered a creative leader because they take such an inventive approach to where the message appears, not just what it says. The real opportunity for agencies isn’t in buying existing media channels, but rather creating channels that never existed before.

9. Creating brand transactions instead of brand relationships. We’ve all heard agency executives say to clients, “Our job is to get the consumer to buy the product once. It’s your job to take it from there.” Agencies have historically been focused on helping to make the sale. But in a marketplace where the actual experience with the brand forms strong customer opinions that get circulated worldwide at the touch of a button, agencies have a big opportunity to help clients create and maintain positive brand relationships from consideration to purchase to ownership.

10. Focusing on “the big idea” instead of “big multichannel ideas.”The days of a writer or art director holed up in a room to come up with the “big idea” for a broadcast campaign are over. No doubt brands still need powerful creative ideas to win in the marketplace, but what’s needed in place of one big, strategic TV-centric idea is a lot of smaller tactical ideas that can live in a number of channels. It’s surprising how many agency creative teams still lack this perspective.

11. Traditional production staff instead of “producers.” No longer does production just mean press checks and TV shoots. As agencies execute in channels ranging from sidewalks to iPhone apps, the production professional must become a real “producer” with the flexible skills and resources found in branded-entertainment companies.

…13. Continuing to allocate client budgets to media instead of creative. Consider this:

Q: How much does it cost to reach a million people on a major television network?
A: Around $60,000.
Q: How much does it cost to reach a million people on YouTube?
A: $0.

In a world where many of the most powerful media have a cost of $0, ideas are the real currency of marketing, not money.

…As Peter Drucker once said, “You can’t manage change; you can only be ahead of it.” Agencies, no matter how smart or resourceful, won’t be able to manage their way out of these disruptive changes in the marketplace. They can, however, devote their considerable creativity to staying one step ahead.

Marketing Voices: Three Recommendations for Marketing Leaders (11min) « Web Strategy by Jeremiah Owyang | Social Media, Web Marketing.

ComScore: YouTube Now 25 Percent Of All Google Searches .

(the article linked to above is reproduced here for your convenience)

ComScore: YouTube Now 25 Percent Of All Google Searches

by Erick Schonfeld on December 18, 2008

Video search on YouTube accounts for a quarter of all Google search queries in the U.S., according to the latest search engine numbers from comScore. Its monthly qSearch report, which was released on Thursday night, breaks out the number of searches conducted on YouTube. If it were a standalone site, YouTube would be the second largest search engine after Google. More searches are done through YouTube than through Yahoo, which has been the case for the past few months.

Christa Quarles, an analyst at Thomas Weisel Partners, writes in a report:

YouTube continues to be a standout contributor for Google generating 2.73bn searches in the U.S., up 8.5% from 2.52bn last month and up 114% from 1.28bn in November 2007. YouTube currently represents 25.4% of U.S. Google site searches compared with 17.4% in November 2007 and is larger than all of Yahoo based on total U.S. queries in November.

The comScore numbers show healthy growth in core search activity as well (stripping out video search, map search, etc), especially for Google. Plain-vanilla search for Google grew 32.3 percent annually, compared to a 29.6 percent growth rate in October. Perhaps all of that holiday bargain hunting is helping.

Google’s core search market share (which does not include YouTube) edged up 0.4 percent fromOctober to 63.5 percent (and up 5.9 percent year-over-year).

Yahoo’s market share of core search queries was 20.4 percent (down 0.1 percent from October, and down 2 percent year-over-year) and Microsoft’s was 8.3 percent (down 0.2 percent month-over-month, and down 1.5 percent year-over-year). See the tables below.