Wednesday, July 8, 2009

Forrester's 5-year forecast and why you should fire your "so-called digital" agency

Forrester's five-year forecast came out yesterday and the predictions were interesting, although not surprising.

In summary, Forrester predicted that interactive marketing will continue to increase, to the tune of near $55 billion by 2014. That will represent 21% of all marketing spend. At the same time budgets will continue to move away from traditional media and toward search marketing, display advertising, email marketing, social media, and mobile marketing.

This change, according to Forrester, means "death to obsolete agencies.” But what about “so-called digital” agencies who only do “online marketing campaigns” (read: Flash microsite).

My guess is that these agencies will also suffer. Why? Forrester analyst Shar VanBoskirk goes on to say that overall, marketing budgets will decrease due to increased efficiencies, and that freed dollars will go "into investments like innovation, research, customer service, customer experiences, and marketing-specific technology and IT staff."

Is your traditional or “so-called digital,” agency capable of doing this work? My guess is, no. Advertising agencies are set up to do only one thing: marketing. And marketing, itself, has changed.

Once the only public-facing voice of an organization, marketing is now joined by product development, customer service and many other groups as organizations become more transparent in reaction to consumer demands.

Think about it.

-Innovation and research were typically functions of product development groups. While they may have had contact with small groups of the public, they did not interface with the general public. But look at Dell Ideastorm and MyStarbucksIdea. Companies today are connecting directly with the public when it comes to product development.

-Customer service was typically a one-to-one conversation. One consumer did not know what another consumer was talking about. But when consumers document their customer service experience and publish it online, or when companies like Comcast deliver customer service via Twitter, the public is part of the conversation.

-Customer experience was also very removed from the consumer. Now, if a store is not up to par, or a representative says something off broad, it hits the web in seconds. Again, it’s a public conversation.

In a world where marketing is the only public facing department, working with an advertising agency makes total sense. Develop a big idea, build a campaign, and you’re done. But in a world where your entire organization is public facing and everything you do is transparent, creating and sustaining conversations and digital experiences that support them is vital.

And that’s where traditional and "so-called digital" agencies fall down. Traditional and “so-called digital” agencies are very good at raising awareness and talking at people, but they do not understand the complexity of building digital experiences. You just can’t build a transparent, authentic dialog on a microsite.

“What, then,” you ask, “should I do?” Here’s your answer. When your advertising agency proposes that oh-so-very 1990’s microsite (which by the way is probably neither searchable nor measurable), you tell them this: “You don’t get it. I need a solution that meets not only the organization’s marketing needs, but its product development, customer service and point of purchase needs. I need a solution that focuses on my customer’s needs and one that enables me to build a customer experience that reaches them at every touchpoint. I need a solution where I can measure every click on my site and every comment on the Web. Can you do that with your microsite?”

Then go get an agency that can develop experiences around your consumer needs and behaviors. An agency that is collaborative and inclusive in its ideation process, and an agency that understands how to build truly interactive experiences.

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