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.

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.

Social technology growth marches on in 2009, led by social network sites.

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

Social technology growth marches on in 2009, led by social network sites

by Josh Bernoff

We just published our third annual Social Technographics Profile in a document called “The Broad Reach of Social Technologies” . The author is Sean Corcoran, with help from out data expert Cynthia Pflaum. The data across North America, Europe, and Asia will be available later today.is now available.

Starting with the book “Groundswell” and continuing now for three years running, we’ve analyzed consumers’ participation in social technologies around the world with a tool called the “Social Technographics Profile.” The profile puts online people into overlapping groups based on their participation (at least once a month) in the behaviors shown in the ladder. We’ve kept the ladder categories consistent to allow us to make comparisons year-to-year, across ages and genders, and across geographies. This provides something that’s often sorely lacking in analysis of online social phenomena: perspective.

The headline: in 2009, more than four out of five online Americans are active in either creating, participating in, or reading some form of social content at least once a month. In a bit more detail:

• In the US, social technology Creators and Collectors grew slowly, and Critics didn’t grow at all. Creator activity appeals only to those who like to create or upload content, and regardless of the ease of blogging and YouTube uploading, this doesn’t apply to everybody. If you believe in the future that everybody will be creating or organizing content, we disagree — it’s a matter of temperament, not technology. As for Critics, those who react to content, this group hasn’t grown at all. Looking deeper into the data, this is a result of a small but actual  decrease in the number of people contributing to discussion forums. Why? Probably because much of this activity has been sucked into social network sites like Facebook.

• At the same time, Joiner activity exploded and Spectators became nearly universal. The explosion in Joiners from 35% to 51% of online Americans reflects the appeal of Facebook, as both press coverage and invitations from friends suck more of us into social networks. Meanwhile, Spectators — those consuming social content — reached all the way to 73% of online Americans, which should end any remaining skepticism about whether this social thing is real. Soon, with the level of social content being put out there, it will be virtually impossible for an online consumer not to be a Spectator. Marketers, if you’re not doing social technology applications now, you’re officially behind. We expect a wave of Web site reorgs and redesigns to include social activity.

Looking at the data by age, we now see that participation among those under 35 is nearly universal (less than 10% Inactives) and even among those 55 and over, about two-thirds are participating. The trend is clear, soon, if you’re online, you’ll almost certainly be consuming social technologies.

We are now releasing international data at the same time as this US data. A few highlights: Europeans continue to adopt these technologies more slowly than in the US, with about 40% Inactives in the countries where we do surveys. The Netherlands and Sweden have the most participation, Italy has the most Creators, and social networks are most popular in the UK. For more details see the summary of Rebecca Jennings’ report on social technologies in Europe.

Asian social participation is typically as high as or higher than in the US. For example South Korea, where I’m going next week, has only 9% Inactives and 48% Joiners, as a result of the popular CyWorld social network site.

The international data by country, age, and gender is here. will be available later today. You can even put the data on your own site — we’ve made it embeddable. In my travels, I’ve found that marketers have a variety of attitudes about social technologies, ranging from “it’s obvious that they’re growing” to “it’s a flash in the pan”. The point of data like this is to provide a real, solid, objective basis for planning and discussion that goes beyond personal experience. No matter who you market to, and in what country, you need to know what your customers are doing. These surveys can help you take that first step+.