Creative agencies have been working in the shadow of media buyers for some years, with their impact on the performance of a campaign unrecognised compared to the uplift which optimisation and programmatic has brought. David Reed finds out why this could be about to change.
Back in the 1980s, one of the most significant events in the history of advertising agencies took place - a band of media independents set up who offered media buying as their core proposition. No brand planning or creative work, just a single-minded focus on buying ad spots and positions in the most efficient way possible. Every ad agency group responded by bringing together their own buying power, ultimately leading to the creation of today’s behemoths like MediaCom, OMD, Carat, Mindshare and MEC.
Until the early 2000s, that was how things remained - then the dot.com boom shook things up again. Digital agencies sprang up offering specialist skills in each channel, from email to search and display. Originating ads for emerging media and buying space in those channels were virtually inseparable, leading to something of a re-merger of the creative and media functions within digital agencies.
In recent years, media has begun to be broken out of the digital space again, driven by the programmatic opportunity. Demand side platforms are a prerequisite of real-time bidding, but they tend to be expensive and so have shifted power back towards those media agencies.
But something is beginning to stir which might see another iteration of what creative agencies have to offer. “If we leave it to the machines, they will leave people out altogether. This is a war without humans. On one side, programmatic is pumping out ads, on the other side, consumers are turning to ad blockers,” says Ben Golik, UK group executive creative director at RAPP.
He argues that despite the supposed data-driven nature of programmatic and the artificial intelligence driving its algorithms, the rise of ad blockers is ample proof that something is wrong with the system. “Data is a view, not a fact - it doesn’t tell you everything. But numbers get taken as a fact, even though they do not give the whole picture. If you are going to talk to people at the other end of programmatic, you need to talk to humans,” he says.
That opens up a space in which creative agencies can start to insert themselves back into the hyper-drive world of digital advertising. After all, something needs to be presented to consumers in those tightly-targeted and efficiently-bought ad spots. As the proportion of ads being bought programmatically rises, so does the size of the content library required.
But Golik warns there are built-in risks. “Testing only works on what you are putting in to be tested. As the volume rises, the budget available for each piece of content goes down. So you never learn anything external to the test - it is an ever-decreasing circle,” he says.
He argues that creative teams have always taken account of the data strategy and brand planning, using the insights provided to make the creative leaps which can make a campaign stand out. That said, “creatives are not the right people to give a spreadsheet. Data is as much about what you ignore as what you pay attention to. Creative should be an input into programmatic, not an output,” says Golik.
DataIQ has long advocated the adoption of data and analytics in order to drive better decision-making and efficiency in business. From that point of view, programmatic fits well with this agenda. But it risks ignoring a key variable - the emotional needs of humans, especially in a marketing context, and how these impact on decision making by customers. As much as analytics aims to remove the emotion from business management, it can’t alter fundamental human behaviour.
Creative agencies are well-placed to bring their understanding of how to engage audiences effectively. Lee Puri, founder of analytical technology company MediaIQ, says: “Creative agencies have got a huge opportunity right now to start making inroads into programmatic, bringing their creative strategies to the fore.”
“It feels like there is a disproportionate amount of focus on figuring out how programmatic can help the challenge of who to target, as opposed to what insights can help determine and engage audiences," says Puri. "The value of media insight that can be drawn from programmatic has the ability really to move the needle when it comes to data-informed creative strategies.
It is already obvious from digital ad metrics that, however much effort is put into targeting, only a tiny proportion of ads gets attention and action. Regardless of where they appear in a browser, app or game, there still needs to be something compelling about the message or how it is presented in order to drive engagement. That is what Puri calls “the secret sauce” which is currently missing.
“Programmatic can be used to inform businesses with insights to help solve media - and ultimately business - challenges. This insight falls short when it comes to fully informing creative executions, in my opinion," says Puri. "Creative agencies by their very nature are in an excellent place to exploit this opportunity. Their use of programmatic technologies to help inform creative executions could be a winning formula,” he says.
Some recent developments in the agency world suggest effort is being made to put together the value chain which is needed to bring creative into play in programmatic. Performance marketing group Merkle acquired London-based digital agency Periscopix last year, for example, and looks set to leverage its long-term understanding of digital media, having started in the early Noughties as a PPC specialist for SME clients.
“Because we are used to working with small budgets and directly with company owners, we have a very data-driven approach which has led us from PPC to SEO and web analytics then, three-and-a-half years ago, into programmatic,” says Liz Rutgersson, head of programmatic at Periscopix.
She spies an opportunity to prise programmatic away from the major league media buying agencies. “Display teams are based around relationships with publishers, but that is less relevant in programmatic. Analytical teams sit far away from media buyers, but they need to be conjoined,” she says.
As for creative, Rutgersson believes, “it is very early days. I never thought our agency would go down the path of building creative for clients, because that was out of our comfort zone. For the first few years, we relied on in-house or media owners’ creative teams.”
What has changed that picture is actually the technical complexity of inventory being traded in programmatic. Ensuring that ads are built correctly to render on each device and platform is no easy task. Having conquered that challenge, her agency is now in a position to leverage the potential of dynamic content.
“One of the reasons we advocate dynamic ads is because if the message needs to be changed or the client is running an A/B test, there isn’t the time to go back to an agency for a new set of content - it is too time-consuming and costly,” says Rutgersson.
This could lead to significant disruption of the creative agency business model which has typically charged tens of thousands of pounds for new campaign materials. “We can’t believe they charge that much and the client is still not getting what they want. We have had situations where my team has had to recreate ads because what was supplied was never going to work technically,” she says.
Now, instead of spending six months briefing a creative agency on the technical specifications of real-time ad opportunities, her own agency has developed its creative capabilities to match its technical abilities. Finding a creative developer with the hybrid skills required was no easy task, but has now given the agency a real competitive advantage.
James Hanscomb, chief data officer at Tenth Avenue, sees something similar developing across his agency’s network. “What we are trying to do is bring together the whole audience engagement piece through relevance, personalisation, content and creative,” he says. “In programmatic, there is a lot more information you can access about the people you are targeting. If we are aware of the ‘who’ part of targeting, then we are in business.”
However, he doubts that programmatic will disrupt the creative process, rather believing that it will drive improvements. “For creative agencies, it is enabling insights into who they are developing messages for and will increase their understanding of them. It is the silver bullet they are looking for,” argues Hanscomb.
One critical dimension his agency is working on is an audience verification service, linking who an ad was targeted at with the individual who actually received it. “Creatives have always been looking for that insight into who’s seeing their ads, but knowing where that audience is coming from has been difficult,” he says.
That opens up the potential for a new era of creative which is informed by its own performance, rather than just by the audience targeting data provided at the outset. Since so much digital advertising is in a constant beta test state, creative also needs to be capable of evolving in line with performance, rather than being created at the start and simply cut and sliced to fit each ad opportunity that arises.
Ultimately, this could fundamentally change what the description “performance marketing agency” is taken to mean. At the moment, it is solidly a lead generation play with an increasing amount of programmatic driving the volume of those leads. Once that optimisation and efficiency begins to plateau, however, the search will be on for a new lever to pull which will drive performance. And that is when many agencies might start to remember that, once upon a time, creative was the real driver of prospect engagement. It could be again.