Updated Reprint
Advertising is facing many new challenges with the explosion of digital content, advances in technology, increasing advertiser demand for value added services, changing compensation structures, account consolidation, and the quickening pace of global competition.
Advertisers are pressuring agencies to prove the quantitative and qualitative effectiveness of advertising dollars. In response, agencies must analyze multi-channel communications (print, broadcast, direct marketing, retail distribution, internal/external sales forces, customer service, on-line) across geographies and draw meaningful insights for advertising. This requires an ongoing gathering of information from diverse sources that must be analyzed and readily accessible throughout the organization.
Advertisers also have a growing impatience for the agency creative ‘black hole’ and are demanding speed, high quality and collaborative involvement in the creative process. This requires agencies to manage high volumes of creative content - print, audio and video ads, brochures, web pages, promotional photos.
Advertising Industry Trends & Issues
Improved intelligence about the performance, effectiveness and return on marketing expenditures
Consistent and coordinated media buying service offerings across the globe
Tighter connectivity with advertisers and print/broadcast media partners
Creative collaboration and increased speed in creative execution
Flexible storage, routing, archival and retrieval of content with associated metadata
Solutions to manage global institutional knowledge and marketing intelligence about brands, markets and consumers
Reduce cost and inefficiency in marketing and advertising management processes
These trends in entertainment and advertising will have significant repercussions for the media buying value chain. In a recent media industry survey, executives of companies involved in the media buying process (media buyers, agencies, rep firms, broadcasters, cable) identified a number of major changes they expect to see evolve over the next few years.
Level of service demanded by - and provided to - advertisers will increase. Advertisers increasingly want on-line access to their schedules and real time information on the effectiveness of their campaigns. Technology will allow agencies and buying services to provide this information and will likely lead to the development of more proprietary marketing systems as the ability to provide information will become a competitive advantage.
The role of middlemen (especially reps) will become more information intensive. While many reps are resisting improvements in technology that will automate the ad-buying process, the executives generally agreed that this technology is inevitable and that the reps that survive will be the ones that adapt. Reps will have to ad more value to the process and become information specialists on local markets rather than just negotiate numbers.
Agencies will become less fragmented by media function and type.
Increasing emphasis on multimedia forms of advertising is driving a need for increased coordination and integration of media teams and for broader planner expertise and depth in multiple media types.
The amount and quality of information will increase dramatically.
The advertising executives we spoke with were becoming increasingly dissatisfied with the measurement of the effectiveness of their advertising. Nielsen lacks a tie in to POS and does not handle cable advertising, and there is strong belief that change will be coming soon. Either set-top boxes will replace diaries once the issue of privacy is resolved or interactive television which they believe is only a few years off, will give them all the information they need.
Advertisers will demand a greater level of globalization in their advertising messages. "This is just the beginning" was the overwhelming reaction to IBM's decision to consolidate advertising with Ogilvy and Mather. The executives believed that many companies will pursue a similar strategy of trying to develop a stronger brand identity world-wide by delivering a single message - that has been properly versioned by region due to cultural differences. Kodak's Pan-Asian campaign and Haagen-Daz's Pan-European campaign were cited as successful examples of this approach.
Advertising and marketing communication companies need to adopt an integrated business and technology strategy to enhance client service and delivery. Regional and global marketing requires access to more information, better information sharing and coordination between multiple agency offices and the advertiser locations. Agencies must reduce the cost and time to service advertiser brands, as well as effectively manage multiple points of contact with the advertiser.
Agencies are typically confederations, built through the acquisition of smaller firms with geographic or niche marketing expertise. As a result, agencies have a broad range of disparate systems on incompatible platforms that make it difficult, if not impossible, to share and coordinate advertiser campaign data, creative content and marketing intelligence. Financial and media buying software varies widely from country to country, but the agency must provide consistent and coordinated services offerings worldwide. Creative management tools are needed to transmit, share, route, collaboratively edit and track costs of work-in-progress between agencies, advertisers, production houses, freelancers...etc.
Advertising is also a high turnover business, where employee ranks expand and contract based on the gain or loss of advertiser accounts. This increases the likelihood that client and marketing knowledge will be lost. Formal knowledge management systems that enable the agency to capture, access and profit from its intellectual capital, are needed to ensure consistent brand stewardship and service delivery.
For an international agency financial, human resources and media management systems can be a significant technology investment. IBM can assist global agencies integrate internal systems with external data sources, and provide middleware to manage media planning, transaction and content flow between agencies, advertisers and media companies, as well as analyze the campaign performance and ‘ROI’. IBM can also provide solutions to unify the infrastructure and business systems within and between agencies. We have the resources and experience to manage data centers, data communication networks, LANs, desktop, help desk and enable business systems globally.
Industry Thought Leadership
IBM's Media & Entertainment Consulting Practice provides companies strategic bottom-line solutions to gain efficiencies and competitive advantage. IBM Media & Entertainment consultants are experts from the entertainment, broadcasting, cable, advertising, and publishing industries. These professionals understand the market's business dynamics and help clients creatively solve their business problems. They have worked with major industry clients in more than 160 countries, spoken at industry conferences and published articles and white papers on industry issues throughout their careers.
The Media & Entertainment Consulting Practice is dedicated to keeping ahead of the curve on industry trends and providing customers with compelling solutions that will help them transition to digital technology. We specialize in understanding emerging technology and industry dynamics that could radically transform future marketing, creative production, and media management functions.
Advertising Consulting Disciplines
Knowledge Management
Creative Content Management
Media / Production Transaction Management
Business Intelligence
Agency Process Reengineering
Customer Value Management
Internet, Intranet, Extranet and e-Business
Strategic Systems Planning
Technology Infrastructure Outsourcing
Advertising Consulting Engagements
Design and implement an enterprise-wide knowledge management framework, administrative processes and technology infrastructure
Integrate systems and business processes in finance, media and production
Develop systems strategy for account management, database direct marketing analysis, creative, production and finance functions
Assist in implementation of financial and human resource system packages
Conduct workflow analysis to streamline agency processes and define logic rules for workflow automation
Project Watershed
The Media & Entertainment Consulting Practice monitors trends and issues in the broadcast and media industries, in order to analyze and deliver solutions. Part of that commitment is the innovative Project Watershed. Launched in 1997, Project Watershed explores the evolution of global media industries by understanding industry trends and issues. The initiative identifies the challenges and opportunities the media industry will face over a five-to-seven year period. It analyzes the impact of those changes on business models, technology, process and organization.