The Observatory International’s view on the IPA and Future Foundation’s report “The Future of Marketing Agencies, the Next 10 Years for Consumer Engagement.” June 2015
Extract from the report
The report identified how brands will need to manage the tension between consumer and brand control. Where harmony will mean balancing personalisation and mass functionality and where the importance of customer experience within the marketing mix will be one of the key drivers for success.
This in turn has implications for the future of the marketing function.
The marketing function needs to evolve and adapt in order to be ready to meet the challenges of the new consumer landscape.
- The role of marketing expands beyond ‘opex’ to ‘capex’
The role of marketing is redefined to encompass research and development, consumer service design, logistics, marketing technology, distribution and customer relations. The budget available to marketing should be part operational expenditure and part capital expenditure.
This is ‘back to the future’ in one sense; with marketing regaining lost ground. Broader responsibility for the 4Ps has been eroded over time, with other functions taking over product and service issues. Operations people might be able to improve processes, but they haven’t necessarily had the customer experience in mind, in the same obsessive way that a marketer would; so this is a major opportunity for marketing to demonstrate its added value.
- The real marketing challenge is internal
Some felt the marketing function was too narrowly defined as tactical marketing communications in many companies, yet the new marketing challenges of 2025 demand a much broader innovative and strategic approach. The challenge is making this live in the organisation. There is often a clash in cultures.
In the future marketing either needs to own the parts of the organisation that deliver the brand wherever it appears (online/offline) or they need to be better influencers/inspirers of other departments to deliver the experience with the customer at the centre. There will be cultural tension, but those with the right skills to get buy-in from the CEO, and cross-functions, will win.
- Marketing partnerships will be more varied and flexible
Clients will need a more open-minded approach to external partnerships. It will not necessarily need to be a complimentary partnership between a big agency and big client. The David and Goliath approach might work better in some areas. As ‘engagement’ is redefined, clients will seek out new partnerships to make their brand more compelling and relevant. While the brand idea will still be the guiding principle the focus will expand beyond the blockbuster brand campaign to encompass anything that entertains consumers and encourages them to share (content marketing/big sponsorship assets/vloggers etc.). Existing agencies will need to adapt fast to become more nimble and agile, if they are to stay front of mind with clients, or play second fiddle to fresher, more dynamic start-ups. It is unlikely that any one agency can hope to have all of the engagement disciplines under one roof to satisfy a brand owner, so the roster of agency relationships will grow, and flex around brand projects. There will be more need for collaborative and consensual working between agencies, with different agencies taking the lead according to the project.
As consumers share via their ever expanding social networks, brands will benefit from direct relationships with those who own them (Facebook, Mumsnet, etc.).
Based on the points above – the ideal marketer is more of a commercial generalist than in the past, orchestrating teams to ‘pivot around brand challenges’.
- Brands will invest in innovation outside of their main business to provide a new pipeline
Unilever’s Foundry and Tesco’s Rainmaker Loft are examples of companies embracing innovation. Barclays have a Mile End project. They sponsor and invite FinTech companies in. Jaguar Land Rover are also investing in an innovation centre with Warwick University; a £50m new facility to bring in organisations from outside – including design studios, engineering and technology companies. Marketers will become more versed in R&D and will expect their agencies to do the same.
- Marketers need to develop a publishing mindset and content management skills
Digital channels have created new behaviours from brands – with no need to bet on two or three big broadcast campaigns each year, they can literally test and learn everyday if they want to. If something works, roll it out. If it doesn’t, bin it. This real-time creation requirement means that agencies need to adapt their production systems and cost structure to accommodate the need for speed and shorter campaign time frames.
Authenticity is key, otherwise brand messages will be rejected. The trend for brands to tell stories about real people, and real situations, like Barclay’s Lifeskills and Digital Eagles, will continue unabated. Real people, doing real things captured on video. A move from storytelling to storymaking.
Knowing what is right, in the moment, for a brand to be connected to, takes the whole new level of confident marketer and agency and the structure to make a call immediately.
Digital has democratised channel ownership – brands can be publishers/broadcasters today if they have the right skill sets or access to them. Lego talk to their target consumers through their YouTube channel, their films, their events, their website. They aren’t constrained anymore.
- Marketers need to develop integrated dashboards for the short and long term measurement of their marketing output and outcomes
Marketers need both real-time data and more qualitative insights to monitor how particular activities are performing in the marketplace. Understanding how this brand activation amplifies other long-term brand-building initiatives is vital.
Access to econometrics and big data analytics will be essential for evidence-based programme management.
The Observatory International view:
The six trends identified by the IPA and Future Foundation in their report resonate closely with conversations we have been having with clients and our own observations and insight into marketing resources.
In a recent article Content marketing and the implications for marketing resources we identified that managing the customer journey and all of the consumer touchpoints extends well beyond the marketing team, into PR, customer service, sales and even NPD. To manage this requires letting go and empowering the team to respond. But to do this effectively there needs to be clarity on where the boundaries are and what are the fundamentals that need to be observed – the ‘freedom of a tight brief’. This article also supports the need to develop a publishing mindset.
Our work on agency roster modelling for clients has reinforced to the need to incorporate a broad spectrum of disciplines within the agency mix to facilitate consumer engagement across multiple channels, with shorter planning cycles, agility and empowerment at the core of the marketing team processes.
We are also having more conversations with clients in both product and service sectors about the need for innovation and how it can create competitive advantage and differentiate through the whole customer journey.