#SHAPEUP or #SHAPEOUT... The world’s largest advertising holding company recently announced a steep slowdown in revenue, forecasting a mere zero to one percent growth this year. Its stock plummeted. Other agency holding companies’ stocks followed. They all blamed the stunted growth on consumer packaged goods (CPG) giants, like P&G and Unilever, drastically reducing their ad spending.
According to the Wall Street Journal: “Already, the world’s largest advertising companies have been coping with marketing clients reviewing their agency contracts to reduce costs, questions about the effectiveness and quality of digital advertising, digital ad fraud, and demands for assurances that ads won’t run alongside inappropriate content. The pressures in the industry have been exacerbated by a breakdown in trust between marketers and agencies.
There is also heightened competition from clients creating in-house marketing and digital buying groups and from media companies creating bespoke brand content.” It’s clear that the marketing and advertising world is going through massive changes. But they’re not just due to some CPG companies that are belt-tightening. These are systematic shifts away from traditional advertising.
Marketers are realizing that digital ad spends simply aren’t working. The lack of transparency on ad platforms means that brands can’t be sure whether their ads actually performed well. (Did they appear on reputable websites? Are the metrics trustworthy? Are real people or bots viewing the ads?) Plus, most consumers are rejecting traditional advertising. They’re done with intrusive adverts that take over their screens and follow them around the internet.
The fallout is starting to hit traditional advertising agencies hard.
Years ago I predicted that the 80|20 principle would affect the industry with specialist brand consultants taking a chunk of the market.
This no doubt will require a #NewThink and set of skills.
The future is here already and the client remains #King.
#ShapeUp or #ShapeOut.
#Brands #BrandExpression #BrandProgression #BrandEquity #GlocalBrands #BrandsToWatch2018 #COBMC02 #20062018