SIR MARTIN SORRELL CHIEF EXECUTIVE, WPP
The agency of the future will be confident in its ability to answer two absolutely basic questions for its clients. First, how much money should they spend on marketing? Second, through which mix of channels can it most rewardingly be spent?
It will not rush thoughtlessly into traditional media or conventional creative executions. It will offer strategies that transcend disciplines; it will be a portal for many talents. It will have commercially valuable advice to offer not just on communications, but also on product formulation, acquisitions, pricing and distribution.
Where the necessary talents do not exist under a single roof, the agency may create a virtual company for the benefit of each client. It will focus on the ends and ignore the means.
Our business will increasingly be outside traditional advertising - in information insight and market research; in public relations and public affairs; in branding and ID; in specialist communications. Currently, the ratio of advertising to other work at WPP is about 50:50. Within ten years, two-thirds of our work will be outside advertising.
The agency of the future will reclaim upstream marketing consultancy work by delivering a seamless service; one that starts with the most fundamental of market analysis and ends with the finished creative artefacts. No other form of consultancy will have the spread of talent that such an all-embracing capability demands.
Media planning and buying will become more complex - good news for our industry. The more alternatives there are for our clients, the more they will rely on their media agencies.
The agency of the future will be expert at evaluating and justifying the solutions it offers clients. The interactive media lend themselves to quantitative evaluation better than the traditional, but that approach will apply across the board. Clients have always looked for evaluation systems - standards by which they can measure our work. What is new is the greater power and scope of interactivity. The successful advertising agency of the future will embrace these technological advantages and use them creatively to their clients' advantage.
The big agency of the future will be brilliant at sharing knowledge.
Collaboration is anathema to many in our industry; they put their arms around every task to prove they are indispensable. Like our clients, we must develop economies of knowledge - not just economies of scale. All this requires the best people. The advertising agency of the future will consistently recruit the brightest and most talented from the greatest universities and business schools.
The big agency of the future may not even be an agency. There will be global clients whose geographical spread and multidisciplinary demands can be met professionally only through the creation of tailor-made teams of specialist agencies working together under parent company leadership.
This century will see advertising growing faster outside the US than inside. Asia-Pacific, Latin America, Central and Eastern Europe, Africa and the Middle East will be at the forefront. Half the world's population is currently in Asia; it will be two-thirds by 2014. But this is not to say that marketing communications will become uniformly globalised. People will never buy the same things everywhere in the same way. Most of our business will remain determined by local taste. Reassuringly, local management will be crucial to the advertising agency of the future.
Given the continuing rise in disposable income, production over capacity in sector after sector, and the increasing need for brands to differentiate themselves through intangible characteristics, the underlying demand for our services can only strengthen. If we respond to these invigorating imperatives for change, we will prosper. If we ignore them, they will cease to be opportunities and become threats.
BOB JEFFREY WORLDWIDE CHAIRMAN AND CHIEF EXECUTIVE, JWT
If today's world has five million people opting to view Live 8 on the web rather than on the commercial-saturated and commentary-laden MTV, if it has Nickelodeon launching a service that makes full-length programmes available online at any time of the day, if it has virtual social networks moving from the internet to mobile phones, you can only imagine the endless, exciting possibilities of tomorrow.
Technological advances are enabling people to consume the media they want, when they want, where they want and how they want. That kind of control will increase ten-fold with the maturation of digital convergence, which will further blur the lines between TV, the internet, mobile phones, music players and devices yet to be dreamed up.
Throughout all these warp-speed changes, two constants will remain: the power of storytelling and the brand experience. What we will have to do then is marry these age-old traditions with the new-age reality of consumer control. We will have to hardwire our agencies to create, share and manage stories and brand experiences in a manner that involves and engages, rather than interrupts or alienates.
One way to achieve this goal is by simplifying structure. I foresee the agency of the future consisting of three groups: creators, producers and architects. The creators will develop big ideas that manifest themselves in stories and brand experiences. The producers will bring those stories and experiences to life however they are imagined - on the web, in-store, through packaging, etc. The architects will be in charge of context, helping to define and manage how, where and to whom the stories are told.
No matter how much we want to drive the ending, however, increasingly we will have to relinquish control to the consumer. Technology is having a democratising effect on communications and soon consumers will no longer tolerate a torrent of top-down messages. Sure, there is risk involved, but look at the potential reward: consumers spending time shaping a brand's story. If that story turns out to be great, it will be considered time well spent by everyone involved.
PAUL BAINSFAIR PRESIDENT OF EUROPE, TBWA
As I gaze out of my office window, looming large just across the road is my alma mater, Saatchi & Saatchi. It dawns on me that I have come about 20 yards in 20 years. This is not unlike our industry.
Despite preaching change and innovation to our clients, our own structures and processes haven't really changed since the creation of planning in the 70s. Perhaps unsurprising, when you consider that we are one of the few industries to spend zilch on research and development. We research the future on our clients' behalf, but not our own.
Yet our industry has never faced so many challenges: technology is now mission-critical; media proliferation abounds; procurement has got our margins by the balls and some clients are making deals directly with Hollywood.
We must reposition, or shrink. Much like the American railway companies of the early 20th century, who believed aeroplanes were just rich men's playthings. They didn't see the future of mass air travel and they paid the price.
We should reposition as "big idea" agencies, rather than advertising agencies. What we do better than anyone is produce big ideas that transform businesses. Einstein said: "Imagination is more important than knowledge." This will never change.
We will reconfigure our business model so we can charge accurately for the results that we deliver.
So, in 20 years, I doubt my peers will be sitting too far from where I am now, but they will have escaped from advertising's shrinking ghetto.
They will live in a far better place, where they can concentrate on the big idea, be the masters of all consumer connections and get paid justly for the difference their ideas make.
RORY SUTHERLAND VICE-CHAIRMAN, OGILVYONE WORLDWIDE
I don't spend much time spotting trends in the agency business, preferring to study continental drift and plate tectonics, where the pace of change is so much racier and more exciting. But here goes anyway.
With the consumer as king and master of their own media consumption, brand communications are left with three possible roles - court jester, courtesan or courtier. Be very entertaining, be very sexy or be very, very useful. Otherwise, be ignored.
Three marketing services titans will continue to extend their world domination.
I don't mean the agency supergroups, I mean Yahoo!, Google and eBay.
Ogilvy will move its headquarters to Shanghai - though, largely for culinary reasons, my own department will operate out of Bangalore.
The targeting, testing and measurement of advertising campaigns will use the methodologies of direct marketing. Not altogether a good thing, as it will lead to an obsession with efficiency at the expense of effectiveness.
Marketers will be 90 per cent female, likewise agency staff. The new Berliner-format Campaign will resort to hiring male journalists in a bid to recreate the sexual chemistry of past years.
The full-service agency will return. We now know that the separation of media and creative, while the biggest event of the past 20 years, was not the most far-sighted.
With the divide between media and content blurring, the two disciplines try to get back together. The marriage works out royally - ie. you have a patronising old-world snob hitched to a young paranoiac.
Demographics will finally die. Targeting of messages will be much more about context - "when" and "how" rather than "who".
Online media consumption will account for 77 per cent of overall media consumption - and receive 8.3 per cent of all media expenditure. This will ensure that online media owners still buy plenty of tickets to the next Rugby World Cup.
Sir Martin Sorrell will drop his BlackBerry in the street and, for three joyous months, control of WPP will pass to a Mayfair wino.
PAUL TWIVY INDEPENDENT CONSULTANT
A good advertising agency has to ensure the triumph of good ideas over the politics of people. Here is how this might be achieved in the year 2020 by an agency called DNA.
DNA's Shanghai, Beijing, Mumbai, Delhi, Moscow, Sao Paulo and Johannesburg offices will be as important as those in London, New York and Paris, reflecting the shift in global economic power.
Fewer but better people will be employed, and their roles in project teams will be determined by whether they are left-brained, right-brained or whole-brained.
Traffic, production, secretarial and junior account management staff will merge into one logistics department, recruited from the manufacturing industry and the armed forces.
Media planning will be re-integrated into the agency and broadened into communications planning aimed at all stakeholders. Internal ad campaigns to employees will be a key part of their plans. Media buying, on the other hand, will be a few people plus a highly sophisticated, computerised bartering system.
Rather than relying on vague consumer research, DNA will employ a panel of cultural historians, behavioural psychologists, semioticians and art and literary critics. They will help DNA determine the precise codes and symbols, hunter-gatherer needs and cultural triggers in any market sector.
Advertising will be tested at an early "adcept" stage using virtual-reality headsets. Unreliable and expensive research based on consumer predictions of their own buying behaviour will have been ditched in favour of real marketplace micro-tests.
Many creative teams will work freelance, from home or from small consultancies, connected by ultra high-speed broadband. Many will be novelists, playwrights, interior designers, architects and film directors, from whom DNA gets 120 per cent by having 30 per cent of their time.
Some DNA clients will have minority shareholdings in the agency and be non-executive directors. The same will be true vice-versa, to ensure genuine mutual interest and respect.
STEVE KING WORLDWIDE CHIEF EXECUTIVE, ZENITHOPTIMEDIA
Anyone employed in advertising who is hoping that the coming years will be less disruptive than the recent past is going to be disappointed.
While the future becomes increasingly unpredictable, of one thing I am absolutely certain: the next ten years (never mind the next 20) will provide greater upheaval than the previous two decades. Within this relatively short timeframe, advertising's traditional job of providing mass communication messages to engaged, receptive and largely appreciative consumers will seem like a faraway dream.
The single greatest change will be the impact that technology has on every facet of our business - the messages, the media, the consumers, the research and the results. As for any sceptics on this, please talk to an average teenager (particularly those living in a household with Sky+); their media network is already composed of the internet, chatrooms, interactive TV, SMS messaging and iPods. Not much space for traditional media in their world.
Consumers will become their own editors and will be empowered as to what messages they receive. All media will be digital, global and on demand, including most newspapers and magazines. Agencies will start to resemble management consultancies, focusing on helping clients grow their businesses.
The neat demarcations between disciplines will quickly become blurred.
Advertising, promotions, direct, in-store and viral will give way to marketing, period. There will be marketing agencies and marketing artists. The marketing agencies will look like today's investment banks, with asset allocation, tools and experts, measurement and research teams and links to a plethora of in-house and out-of-house vehicles. They will be evaluated and paid on measurable performance metrics that are predominantly outcome based.
The marketing artists will be more right-brain and create engaging experiences (holographic, in-store, 3-D online, etc), rather than simple ads.
The new currency will become "attention rights", where consumers are paid in some form for their attention. Teenagers' mobile phones could, for example, be paid for by companies in return for receipt and receptivity of messaging. This will raise the cost of reaching people and so more and more marketers will develop highly relevant, closely honed and targeted messages that are measured on outcomes to justify the cost of getting people's attention.
What won't disappear is the necessity of understanding a brand's essence.
The role of the planner will become more critical, as we need to understand the consumer's interaction with a brand better so more effective personalised messages can be delivered.
So what should agencies be doing to prepare for the change? First, generate profits by doing what clients want today, in order to be able to invest to stay in business tomorrow.
Essential to this will be the need to reduce the cost of the commodity part of our business in order to be able to develop better skills and technologies that can be applied to exploit the new opportunities.
The talent we employ will need to evolve. We will need to recruit a new type of executive, define the roles they will play and train them accordingly.
All of this change will be unsettling, uncomfortable, costly, challenging and exciting. As someone much wiser than me once said: "Change is not made without inconvenience, even from worse to better."
KEN KAESS PRESIDENT AND CHIEF EXECUTIVE, DDB
The analogy that advertising is a glacier in a global-warming environment is one that is heard all too often. A far more appropriate analogy is the telephone. For many years, the phone has been the backbone of communications, just like advertising.
Still, the definition of the phone has changed radically over the past decade. It remains, of course, the landline. But for many people in many countries, and especially for individuals aged under 30, the phone is not the antiquated landline at all. For them it is a "third arm", the total link - voice, visual, entertainment - that is the source of all communication.
In the next ten years, advertising can and must morph in both perception and usage, like the phone did over the past 80 years. Like the landline, traditional media isn't going away any time soon.
However, the changing media landscape will continue to have an immense impact on advertising, on brand communications and on the consumer brand experience. A brand experience that advertising must create and sustain through whatever medium or vehicle - be it gaming, TV, personal video recorders, on-demand service - to deal with the incredible democratisation of the media that technology has brought us.
For advertising agencies, that means a great deal must change. We'll see hierarchical management structures replaced by collaboration across ranks and disciplines, inclusive of both clients and consumers. To arrive at this state, our industry will have to re-examine who it recruits and how it retrains in order to deliver not just ads, but creative business solutions.
To deliver these, we must apply creativity much earlier in the marketer's business cycle. We can no longer be merely the communicators of the strategy, we must be the co-creators of strategy, working seamlessly with the client on business problems and opportunities.
The definition of creativity will change. Creativity, like media before it, will undergo some democratisation, with creative ideas or strategies the responsibility of a wider cross-section of talent - as revolutionary a thought as the idea of teaming art directors with copywriters once was.
Creativity will apply equally to the imagination we use in selecting the vehicle (or, more appropriately, the mix of vehicles) to deliver the brand message, as it does to the content and style of the message.
To refer back to the telephone analogy, the advertising agency can either be perceived as the trusted but limiting landline, or as the communications device that no person (marketer) feels comfortable without. Landline or key portal - now is the time to establish the perception of what advertising is.
What will not change is our commitment to serving clients wherever they need us and our commitment to creativity, whatever its genesis or form.
Creativity is our main currency and must always be so.
JOHN HARLOW PARTNER, NAKED COMMUNICATIONS
Agencies owe their existence to the complexities of the market between producers and consumers. This is both the strength and weakness of the middleman marketplace. When you are in control and the issues are complex, but both sides of your market are in stable growth, make hay. When you aren't ...
It's a delicate balancing act: just ask Bernie Ecclestone. Because if little things start to get out of control - such as, if consumers (or producers) stop listening to you and start doing their own thing - then, all of a sudden, you have a problem with your business model.
Let's not beat around the bush here. Agency existence is predicated on matching the needs and wants of consumers with the solutions and dreams of producers, linking them through tightly controlled channels where you effectively own the tools of the exchange. If any of the above changes, there's cause for concern.
What we've probably forgotten is that any market is dynamic and the function of a market is to match supply and demand. We must remind ourselves that we are no more than composite parts linking buyers and sellers. The typical agency model has lost sight of the broader delicacy of this balance and has instead evolved into making hay.
Current agency models are of their time, just like the coal-mining companies were. Both are large-scale, economically significant industries, vertically driven into the production of lumps of stuff for the masses. Equally, both became too focused on production. The desire for energy, like that for communication, never went away - it's still increasing today. But coal, like advertising, was a means for its time as opposed to the long-term answer.
The problem starts when any company shifts from long-term demand into short-term supply. If you start with a mission to entertain children, but all of a sudden build factories to make the Rubik's Cube, your business changes.
The issue here is that the advertising industry is supposed to be customer-focused. "Always know your audience" is a mantra even the crappiest sales person could recite. So why, when people can avoid/filter/edit/create/ignore/phone a friend, do we still think the solution to any client problem is that piece of collateral that the agency has always done and happens to make its margins on?
My boy Jack asks the right questions: as a business that is there to help clients reach customers, shouldn't we understand consumers first?
And if it's true that they use a lot of stuff, such as iPods, phones, pay-TV and the web, which doesn't rely on ads, then shouldn't you concentrate on sticking with them, seeing the wood for the trees, and outsourcing production so you don't risk ending up with Rubik's Cube factories? Because if the consumer is king, isn't the agency that reflects the consumer more likely to be king too?
At this point, given that he's three years old, I stop him. I agree with him that the smart money is on moving with the consumer, providing answers, but never getting bogged down in manufacturing. But I reprimand him nevertheless for thinking that being king is better, when really it's just different.
You can't be king of nothing, and consumers and producers need each other symbiotically. We both agree in the end that the only place you can't be is sitting on that fence, which is going to crumble any second now.
DAVID PATTISON WORLDWIDE CHIEF EXECUTIVE, PHD NETWORK; PRESIDENT, IPA
To look forward, you sometimes need to look back. In the past 20 years, most of the changes in our industry have involved media. There's more of it, there are more routes to consumers and consumers themselves are becoming more "educated" about it. So if you look forward, what is going to change?
Inevitably, there will be more media and more routes to consumers. The consumers, however, will be much more likely to edit or ignore what they are seeing.
The big need from clients will still be to persuade consumers to engage with their product or service. And they will be looking for their marketing partners to offer understanding and ideas and be able to generate attention from consumers.
Ideas will not be the sole preserve of the creative agency. Ideas will be generated by anyone and everyone, not just by people from within our industry. This will mean that strategy and process will become the key differentiators. There will be few premiums to be charged for ideas. Insight, speed, accountability and accuracy will be the requirements.
Because there will be a global economy, there will still be global clients who will require global marketing services companies (if they haven't bought them by then). The structure of the industry as we currently know it will be less rigid, with less infrastructure, and the range of services offered will increase significantly. There will be an increase in the number of local specialist suppliers bringing ideas. No-one will be able to offer complete understanding of everything under one roof.
To be ready for the future, agencies need to learn how to value what they do and generate enough income to recruit the very best people. Creative agencies should realise that they will need to change the most. Media agencies and direct marketing agencies feel well-placed to move to the future. But then I would say that.