Ad Agencies And Their Relationship With Data

Added on by Arturo Gutierrez.

In an HBR blogpost this morning about advertising and data there were some obvious things mentioned about the relationship between the two, and some just not correct.


Starting with the obvious; yes, data is important, ad agencies need it, and you need that human element, etc etc... but why does the bias toward ad agencies having that human element exist that does not apply for other types of firms? Why do creatives get that credit? Maybe we tend to lend them that attribution because they formulate ideas, programs, that directly touch consumers. But having worked on the agency side, and understanding the historicity of data driven decisions in agency environments, there is a lot that is not understood about humans by ad agencies that well conducted unbiased research and analytics can provide. This is where the threat lies for ad agencies because many other firms are able to gather this information and read it accurately.

The rest of my thoughts summarized in the short comment I left on the HBR blog:

How exactly are Google and Facebook competitors to big ad agencies? If anything they are complementors. And while I agree that data is only as good as they analyst charged with extracting meaning, there are some very advanced analytics tools out there that understand nuance and user behavior. The data dilemma ad agencies face isn't that of relevant insights or interpretation, it's that of a lack of capabilities to implement and deploy for a client that wants data. That's why I see Management Consulting firms being the true competitors to ad agencies, not the Googles of the world, that just doesn't make sense. 

I'll continue to believe that the limitations ad agencies face in regards to data is purely the lack of capabilities to implement and deploy. Some of the larger traditional agencies still haven't exactly succeeded in selling that offering. SapientNitro on the other hand, is rooted in technology consulting, and guess what, those guys know what they are doing in regards to analytics: smart acquisitions, intelligent leadership. The next 5 years will be very interesting. Ad agencies that survive will be able to offer analytics to clients (creating their own tools, or in strong partnerships to create proprietary tools with companies like Omniture), those that don't will be acquired or lose out entirely because they will not offer what a Razorfish can with FLUENT analytics tool or SapientNitro with their offering. And one more thing, management consulting firms will move in to the creative space. First as strategists, and then as creatives. Accenture Interactive got Fjord this past May, what do you think they are positioning themselves for?


- arturo gutierrez