This article by RAPP India President Venkat Mallik appeared in Hindu Business Line, one of India’s largest dailies:
Wonder if you have managed to look at the Advertising Age’s Family Tree 2010 report? It has a few things that you may have known of before but it’s worth looking at those statistics with a new lens.
Did you notice that Ogilvy One is bigger than O&M Advertising globally? The other two large direct, digital and data-driven companies — Wunderman and RAPP, are also larger than O&M Advertising? Wunderman, Ogilvy One and RAPP are each at least twice the size of Lowe & Partners globally.
This way of juxtaposing the data will certainly raise the hackles of a few purists but it’s just a startling truth about the rising influence of direct, digital and data-driven companies in the new world of marketing. Companies like these are also more likely to get picked to be part of the club of agencies that bring in the largest amount of new thinking and innovation into the world of marketing.
Quite obviously, the growth of these companies reflects the very real and substantial move of marketing and communication budgets towards measurable result-oriented solutions. The world does want to know what happened to that other half. The recent recession and the rising power of digital as a measurable and viable one-to-one marketing tool, is only going to drive this further. A number of new age communication thinkers believe that in the new age of marketing, agencies that are not data-driven and digitally capable will cease to exist.
The new report from Interpublic’s MagnaGlobal essentially predicts that globally online advertising will grow to be No 2 after TV, dislodging print advertising from that position. The global online advertising industry will grow to be $103 billion by 2015. Meanwhile, there is a Group M report that estimates that online and mobile spends in the UK will be larger than TV and print in 2010. This is now.
The rise of digital is certainly a pattern which everyone has been talking about for sometime — now it’s reaching an all new scale. While the advertising world continues to vigorously blog about the impact of paper turning to glass it’s just a matter of time before much of TV starts getting delivered through the Internet.
The recent PricewaterhouseCoopers report on entertainment and media predicts that China will overtake Japan as the world’s second largest market. The rise of Asia will bring in substantial shifts in the way products, brands, services and, therefore, marketing concepts are thought about. If China gets there can India be far behind?
The impact of these patterns is already being seen in communication thinking across the world. First, in the post-recession period, clients are being held accountable for driving behaviour change rather than changes in attitude among their customers. So classic communication thinking, which has traditionally focused on attitude shifts with a half blind eye towards behavioural changes, is going to find it tougher and tougher to command the marketing dollar.
A flurry of new concepts and metrics is entering the communication lexicon driven by data and digital thinking.
GRPs now need to co-exist with CRPs. Unmanaged or unpaid media has found its way into the planning process to supplement managed or paid media. Word of mouth has found a completely new lease of life. Segmentation has started getting a whole new level of granularity and social sensitivity not viable earlier. The culture of testing before launch, which was discussed all the time but was seldom practised, is now more real and has given rise to concepts such as the design of experiments which help cut the learning curve significantly. Overall, the world of communication seems to have acquired lots and lots of new concepts and themes to work with.
Right now there is a flood of digital-only agencies. If digital continues to grow as predicted, it is very unlikely that it can stay a separate silo and will need to be completely integral to the communications business and to what are still called mainline agencies. This process has already started with many ‘mainline agencies’ creating an integral digital offering or merging their separate digital entities back into the mainstream. Data and digital have already merged together in one-to-one marketing companies.
Lastly the emergence of Asian economies will also drive new ways of thinking. The Eastern mind does think a fair bit differently from the Western mind. All of us know that the value systems, beliefs and attitudes in countries such as India, China and other Asian countries are different. The primacy of the individual will give way to the supremacy of the family.
Emotions will drive communication thinking even more than reason. When these countries become large enough as communication markets to give birth to genuinely original thinking there will be a new set of guidelines and thinking tools.
All told we are in for substantial shifts in the way we think about marketing and communication. The three driving changes are data and measurable behavioural change, digital and Asia.
Cheers to the thunderstorms and radical shifts that are going to sweep our marketing world!
(The writer is President, RAPP India, DDB India’s relationship marketing and data management agency.)
http://www.thehindubusinessline.com/catalyst/2010/09/16/stories/2010091650060300.htm
