When I grow up I’d like to be more like a start-up
Justin’s ‘Agile versus Strategy‘ post has tapped an excellent debate.
One of the most interesting comments comes from R/GA’s William Charnock, who makes the point that traditional ad agencies got rid of ‘the makers’:
They outsourced production to directors, photographers, digital technology specialists etc and carved off media execution to separate media agencies. With no ability to prototype, experiment or execute in the real world, the only option for them was to focus on ‘conceptual thinking’ or ‘BDUF’.
Some forward thinking agencies seem to be addressing this, if only on a small scale, setting up labs for experimentation (a la Ogilvy, BBH, Media labs etc.); creating partnerships with content creators, VC’s and start-ups (who truly are the leaders in market agility and fast fail learning/prototyping).
As William and other commenters say, it’s the start-ups who are the true leaders in this space – not least in terms of overall value creation. Indeed, you could argue that the ‘start up culture’ of high-growth tech start-ups has become a defining (and disruptive) force in work cultures well beyond tech, marketing and media.
To traditional agencies start-ups must seem superhuman, and super-scary. Look at FourSquare: in just 12 months and with a mere handful of smart, motivated people they’ve created an entirely new media ecosystem and platform, not to mention a service that people actually love. They’re already working with lots of brands, including Starbucks, Pepsi, Zagat, Bravo, Conde Nast and The New York Times. Thousands of awesome campaigns for thousands of clients will run on FourSquare in the coming months and years. Brands will use FourSquare to add real, everyday value to their customer’s lives instead of wasting money pissing them off in expensive bursts. Agencies must look at FourSquare and worry.
Traditional agencies would love to bring some of these uber-makers inside the castle walls – but how’s that going to work? Unless agencies can find some way of giving these start-up punks some skin in the game, what’s in it for them? Why would they? They don’t need agencies, because they’re busy replacing them.
Of course, we’ll see agencies piling into software development, and they’ll certainly look more like tech start-ups – but that’s different to getting the ‘start up culture’ inside. Unless you can address structural issues like ownership, autonomy and putting engineers in at the top this simply won’t work – and those are fairly big asks. Stuart and I were discussing the fact that most industries realised they’d needed CTOs and CIOs in at the top a few years ago – but which ad agency has a CTO sitting at the highest level, on the Board? They may be frightened right now but perhaps not enough – until this happens I’m just not sure you could really say it’s being taken seriously enough.
Meanwhile, FourSquare is launching brilliant stuff on a weekly basis – and there’s still only 16 of them. And there are many, many FourSquare’s out there. If you were starting out today and were bright and ambitious – who would you rather work for?
10 comments
dont burst my bubble tim malbon! here i was thinking that the change will be so necessary that for people who just wanna “get shit done” there would be a space for them in agencies (and clients for that matter). Forward thinking, top-notch, a-list and it would happen in 5 years as I hope it.
So don’t you burst my bubble. Cuz in my weird sense of reality, only doing one thing, read: product, wouldnt be as fun as dong 3 (read brands/categories). Surely I’m not the only one who came to the agency world so some sense of diversity and rapid change?
Or do I need to take off the rose coloured diors?
Such a good point. And funnily enough, I’ve just penned a post on the same subject (but from a slightly different angle):
http://bit.ly/bP9mbo
As I say in the post, I find it ironic that an industry that applies so much resource to understanding young audiences applies so little of that understanding to shaping their own organisations into places where those people will really want to work.
http://bit.ly/bP9mbo
Hey Matthew – please forgive me. I certainly don’t want to burst your bubble. And I agree that having a varied diet is a great thing. I suspect ad agencies are good at a great many things that start-ups struggle with – and I wonder if start-ups might tend to be – at a general level – narrow in outlook. I remember someone telling me how weird the Valley was because it’s got the greatest density of broad spectrum autistic people working and living in a very concentrated area… whereas ad agencies seem to contain lots of really diverse types of culturally interesting people. But it’s hard to talk at such a general level. All I’m saying – somewhat gloomily – is that the teams making the best products and services are unlikely to be making them for agencies unless there are radical structural alterations. They are likely to be so radical as to no longer be what we call agencies today – as in, we wouldn’t recognise them as such. The most forward looking ones must already be looking at such radical shifts – probably looking forward to them in some cases… so don’t get down. Everything is converging – and some media companies, our dear clients at the Telegraph Media Group’s Euston Partners offshoot included, are trying out completely new models. See http://www.guardian.co.uk/media/2009/nov/30/telegraph-digital-will-lewis-euston-project
http://www.guardian.co.uk/media/2009/nov/30/telegraph-digital-will-lewis-euston-project
Aha – Neil! Howdy. What an awesome blog post from you – yes, yes, yes – and your point that the effect is masked right now because of the poor jobs market is a good one. I was struck this year at SXSW by how many agencies were out there doing recruitment 24/7 – I met someone very cool from AKQA in the US and that’s apparently what they were doing – just trying to get good people. I think that despite the recession, in what we all do there is actually a talent shortage at the moment.
Loved this bit – and the video:
“Right now, companies have the luxury of a poor jobs market but for how long? If the industry is serious about wanting to attract developers, creative technologists, the people who will build the future, I think it needs to change. This generation, far more than any before it, have the tools to take control of their own careers and their own learning, and they are doing just that.”
Thanks Neil,
T
Welllllll……it’s hip to claim that the world revolves around Foursquare-esque applications. I don’t think so, yet. My world does. But in fact there still is a bigger marketing market for strong ideas which can be executed 360°. Take a look at Groundswell’s Technographics Ladder and ask yourself how many creators can be found among a target audience of 100 people? 3? 5? 7? I love social tech. But in most cases the average customer can still be better adressed with a strong (digital) ad message or in store.
Hi Gerald
I’m not really saying the world currently revolves around Four-Square-esque applications. Even my world doesn’t… honest.
I’m not even saying “the future’s geo-social man”. I was using FourSquare as an example of a small team being able to achieve an incredible amount – in terms of software development and service design, from the ground-up, to sign up 1/2 a million users globally in the same 12 months and get commercial deals in place with a load of top brands – with many other brands no doubt currently beating down their doors. My point was that the kind of massively participatory, integrated (by which I mean ‘into the real world’ – through the mobile in this case) digital platform and service that FS are building is the kind of place that anyone with something to sell or say will want to play in. It won’t replace traditional marketing communications but I think it will mutate it into new forms that will be based around more dynamic value exchange with all stakeholders. Personal context and service (including emotional utility such as play, with the FS example) will be more important than in the past simply because they can be. It’s going to be exciting.
My point was that ad agencies are not currently set up to develop social software services like FourSquare. It’s heard to see how FS could have been created by anyone but a genuine, determined, invested start-up team. Sheer scale and complexity, and legacy corporate structures make it very difficult for any big established company to really ‘act like a start-up’. As William Charnock points out, there are quite a few examples of agencies trying it out in a labs or skunkworks type of environment – where scale and structure can be safely redefined. It would be really interesting to see how this develops – I wonder what it looks like when ad agencies become part-investors and part co-creators with the start-up punks, and bring their creative, cultural muscles to bear in a way that makes it all work even better. I hope someone tries that soon. We are hatching some plans to expand the ways in which we can work with start-ups and entrepreneurs.
As for Groundswell’s ‘Ladder’ – it’s a great model and very useful, but it was first developed three years ago (?) and it’s a ladder… people are climbing up it all the time – you put a ladder against a wall and people climb up it. And in the last three years, the neat delineations between Creators, Critics, Collectors, Joiners etc have blurred. It comes from a time when people had a photosharing site where they put photos, went to a video sharing site for video, and poked friends on a social networking service like Facebook. Now Facebook is ALL of those things.
I think the ‘average customer’ is much better prepared for the future than many governments, organisations, media owners and brands are, but not to be “addressed” with anything. They want to join in.
Great discussion, as always. Thanks Tim for picking up on my ‘aside’ comment and making it the topic of a whole new post. I have been playing in this arena for only a short time but have some learning from trying to do this in an agency environment.
My personal experience started with short piece in Adweek in 2008 entitled “We can be rock stars” http://bit.ly/bY8B2B I had experimented with a skunk-works initiative at JWT called Sector 64 which was innovative in terms of creating business ideas that were the intellectual property of the agency, but ultimately not very successful for a couple of reasons. Firstly, unlike start-ups, this small team tried to do too many projects. The real success of start up culture is a small passionate teams dedicated to a single initiative. Start up teams don’t have multiple initiatives on the go at the same time, they have one that they are passionate about and work tirelessly to develop, execute and improve. As long as an innovation lab or skunk-works is expected to execute multiple business ideas, in the same way as the agencies creates multiple campaigns, my guess is they will suffer the fate of our own initiative. The second challenge, we faced with our early experiments was that the initiative sat outside the core of what the agency did. Management focus, decision making and resource allocation were all slowed down by the demands of ‘fee paying clients’. Since the revenue model of our initiatives was much longer term and unproven, the immediate ‘cash in hand’ won every time.
http://bit.ly/bY8B2B
This led to my second attempt at new revenue streams at the agency. This initiative was a little more successful. Rather than depending on agency resource to execute I worked with already funded tech start-ups and venture capital partners to lead the development and execution. Essentially we created separate business partnerships with agency and tech-start up resources that were dedicated to delivering an initiative. The agency, as you describe, brought “creative and cultural muscle” as well as financial support from the big brand spenders. Although in this case these partnerships were not separate LLC’s the model was such that they could have been (offering both share of revenue income and exit strategy). Agency, tech partner and VC all working closely together, dedicated and able to make decisions, allocate resources and build a high growth business idea.
Even with this model of working I came to realize that the ‘campaign’ culture of agencies was a big hurdle to building something that has lasting value and ongoing revenue potential. The ideas that agencies have are often great, but they don’t expect them to last, nor do they build and grow them over time. Sure there are campaigns that run and run and run but fundamentally agencies are not set up to create long term platforms and utilities like the examples you use above (Foursquare, twitter, facebook, etc.)…and like you I am not saying these are the “be all and end all” of marketing but they are valuable interfaces between consumers and brands that any agency would love to have created and sell to its clients, but unfortunately never would or could.
Great post / comments everyone. I was struggling to find the right response to Justin’s agile planning post. I arrived at a place similar to where your landed Tim.
When you combine agile with other disciplines, philosophies, approaches etc it elevates the conversation to a place that is, well, pretty damn zoomed out. It becomes a question of how brands/organizations/startups should operate and evolve.
For example, in the web startup culture you discuss in your post, a very popular term has emerged – “Lean.” The concept of lean startups (coined by Eric Reis) is the combination of agile/adaptive development philosophies, Steve Blanks “customer development” methodology and open platforms / open source technology. That kind of thinking (in a non-dogmatic way) is allowing folks like foursquare to do what they do. This post is a great place to start with lean – http://venturehacks.com/articles/cheap-startups. Agile really becomes interesting when paired with other philosophies, disciplines and ways of working.
http://venturehacks.com/articles/cheap-startups
But as William’s stories of working in agency labs and skunk-works groups point out, it just doesn’t play out the same way as it does in startup land. So my question is what is the analog to LEAN in the world of brands? What makes my head spin is the prospect of lean services. How can we apply these concepts and philosophies to experiences with non-digital components?
Makes me excited for a time when people participating in this convo are at the C level of big companies. Hurry up now!
Good thought Justin. Think that using “lean” could be a better way to talk about this whole ‘extending Agile’ into strategy/agencies/creative work discussion. Certainly Agile is slightly like a religion (many believers work here at MxM) so people will pile in to Agile-related discussions with a preconception from their Agile experience. And certainly, my experience/observations are that start-ups are more lean than they are Agile.
Clayton Christensen would suggest that agencies are unlikely to apply new technologies/models in a disruptive way.
One reading of his Innovator’s Solution suggests that agencies create/fund relatively independent new ventures, in hopes of integrating/migrating down the road.