CAMPAIGN INTERACTIVE: BEHIND THE HYPE - NEW-MEDIA STRATEGY - Digital offers a lucrative platform for consultancy. It’s the only game in town if you do new media work. Richard Cook investigates
By RICHARD COOK, campaignlive.co.uk, Friday, 25 June 1999 12:00AM
Suddenly, everyone wants to be a management consultant. It’s still all right to dream, to create, and to plan, you understand, but consultancy is now where it’s at. Especially in new media.
Suddenly, everyone wants to be a management consultant. It’s still
all right to dream, to create, and to plan, you understand, but
consultancy is now where it’s at. Especially in new media.
For years, advertising agencies worried that the evil spectre of
consultancy was eroding their usefulness. Consultants, they feared, were
getting closer to clients by appropriating the strategic advice they
formerly gave away for free.
Worse still, they were charging large sums for it.
And so mainstream ad agencies decided to try to market themselves as
strategic consultants and claw back some of the ground they had
They did this with, it should be said, limited success. Now the digital
revolution is providing them with an opportunity to try again.
Unfortunately, everyone else seems to have spotted the opening too.
Certainly there has been a rash of activity in the last few months in
this particular direction, as ad agencies, media agencies and specialist
new-media agencies have moved to embrace consultancy in a big way. From
the other side of the hill - but all heading for the same digital high
ground - come the brand consultants and management consultants, hiring
marketing and agency personnel as they go.
The first tangible evidence that this was something more than a passing
fad came last year when the Lowe Group backed the start-up digital
management consultancy, Decipher. According to Lowe, it made the move
because Decipher had what the agency world lacked - a commercial focus,
rather than a marketing one.
Nigel Walley, the Decipher managing partner, explains: ’Everybody talks
about convergence as being at the heart of the digital issue, but they
normally mean between IT and telecoms. For the media industry, the more
important convergence is between brand marketing and sales. Media
decisions used to be just about communication. In the digital age, media
decisions can affect sales and distribution to the same extent and it is
incumbent on professional agency groups to be able to solve both sides
of the equation on their clients’ behalf.’
This collapse of the wall that once divided marketing and commerce
explains, more than anything, why so many previously disparate service
providers are now rushing to occupy the same territory.
Among them are new-media agencies such as AKQA, which last month created
the AKQA Consulting group to handle long-term projects in areas such as
e-commerce and in business issues relating to new media. Meanwhile, the
AKQA Communications group will continue to focus on the former staples
of the agency’s business - digital marketing communications, branding
and interface design.
The other big boys have made comparable moves. Agency.com, the former
Online Magic, recruited Steve Ross in April to head a new strategic
services division based in London and to spearhead strategy via the
whole European network. Ross, the former interactive commercial director
for Air Miles at British Airways, argues: ’It’s a natural progression
for the online agencies to move into consultancy. When we started, new
media was very much production focused, but things have really moved on
from there. The fact is that clients don’t just want a web page
designed. They want to know how to make money from it, and that’s where
we come in.’
All the offerings are hoping to position their consultancy business in
rather different ways. AKQA, for example, sees itself as competing not
with the McKinseys and PriceWaterhouseCoopers but with the IT
’It’s all about being able to produce a return on investment for clients
within the next nine months,’ AKQA’s chief operating office, Matthew
Treagus, says. ’We are fighting it out with the big IT providers to help
design products that will enable clients to achieve that goal.’
Media agencies, too, are vying to carve out a lucrative niche for
For years, they have been fighting to break out of commission-based
media-buying briefs into the fee-based strategic arena.
Digital provides them with their best chance yet to do so.
Some, like Motive (with Motive Digital Services) and Booth Lockett Makin
(with Quantum New Media), have branded their offerings separately in
order to underline that this is not a service they are prepared to give
Others - like Western International Media - have chosen to concentrate
solely on the strategy, outsourcing the online buying to a specialist
Paul Longhurst, managing director at Quantum, comments: ’At the moment,
new-media spot advertising is not that big an earner for agencies. All
they are concerned about is keeping the client relationship for some
time in the future, when it will be. And what clients want at the moment
is to have a strategic conversation about how they can use interactivity
as a whole. The bigger debate is how they communicate one to one with
But how many consultancies can the market really take? The total size of
the consultancy market has already more than doubled in the 90s and
continues to multiply in virus-like fashion. According to estimates by
the Management Consultants Association, there are now around 18,000
management consultants working in the UK. Billings of MCA members alone,
which it estimates account for around 60 per cent of total billings in
the sector, are now worth pounds 1.7 billion, compared with pounds 810
million in 1990 and just pounds 62 million in 1980.
But the management consultants are dismissive of these new
In their eyes, it doesn’t matter how agencies brand themselves or how
cleverly the consultancy operation is stripped from the main body of the
offering, the problem remains a lack of independence. How can agencies
avoid the trap of advising companies to invest in their own
’It’s like double-glazing salesmen who have the words double glazing
consultants printed on their business cards,’ says a director at one of
the biggest mainstream management consultants. ’At the end of the day,
it doesn’t mean they aren’t salesmen and it doesn’t mean they won’t get
treated as salesmen.’
This article was first published on campaignlive.co.uk
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