Today, the UK advertising industry is in rude health, with competition between holding companies and independent agencies driving innovation. Yet things haven’t always looked so rosy.
The story begins all the way back in 1869, when the world’s first full-service advertising agency opened its doors to the world. Unlike its predecessors, N.W. Ayer & Son brought sales and creativity under one roof; planning, developing and executing campaigns for clients such as De Beers and the US Army. Advertising agencies in the US then began expanding globally between the World Wars, with their UK counterparts following suit in the 1960s and 70s.
Yet, as the 80s dawned, a ground swell of independent, specialist media shops were beginning to upset the apple cart.
A changing environment
The big agencies saw these upstarts as a threat to their monopoly, so mobilised efforts to acquire them. Holding companies were established to accommodate this wave of ‘unbundling’, and by the turn of the 21st century network agencies – as they were now known – had grown to dominate the advertising industry worldwide.
This elite group fought over a clutch of blue-chip clients, jockeying to launch campaigns across TV, radio, billboards and print. For the multitude of smaller businesses that couldn’t afford to hire a network agency and advertise nationally, it was direct mail or print ads in local newspapers, where deals would typically be brokered directly with the publisher.
Then something arrived to tear up the status quo: digital media.
The struggle to meet new demands
I was stationed at a global media agency during a time when client expectations began to change. Having cut their teeth and grown amid the internet boom, a new breed of business was approaching traditional media, taking a look around, and asking: "where’s the flexibility?"
It wanted access to last minute opportunities, and the ability to optimise campaign activity mid-flight. What’s more, it had no patience for share deal arrangements or Advanced Booking deadlines – autonomy with expert guidance was the name of the game.
The problem was, many of the network agencies were ill-equipped to cater for this. We were too big and set in our ways to adapt to this new way of working. I would book TV campaigns three months in advance, wait for the results to crystallise six months later, and then send a report to the client. Sure, we may switch a couple of channels if they had consistently under-performed, but mostly it was a case of sticking to a formula.
This worked fine for bigger clients who dealt in ratings, reach and frequency. Yet things were changing: the new influx of emboldened brands wanted far greater control over how their budgets were being used.
Suddenly, salesmanship couldn’t get you so far – trust became harder to earn. Nonetheless, despite being hired as a senior planner and buyer, I found myself having no strategic say on the direction of a campaign. My job was to justify decisions already made at the top of the hierarchy.
A cultural shift needed
Allied to these structural limitations was a culture that wasn’t maximising talent. There were many great people working in media at the time, but what you would often find was the positions of power – the C-suite execs and other key decision makers – were held by white, middle-aged men. The playing field was an unlevel one, with the gender pay gap a barely-mentioned issue for the future.
Back then there was also precious little representation of the BAME community. This was hugely problematic in the sense that the industry distanced itself from the diverse perspectives and experiences of media consumers. It simply didn’t reflect the wider population, with industry leaders far too slow in responding.
It all felt a bit casual. The media industry has always been seen as a fun place to be, but there was too much of the perk, not enough challenging work, and next to zero awareness of the bubble we had built around us.
With brands now asking more of their agencies, the industry needed to move away from the Mad Men culture of the past towards a more hands-on approach; one underpinned by the meeting of human intuition and technology. Yet, instead of addressing the problem, some agency leaders would simply attribute the under-performance of campaigns to a lack of budget.
The dawning of a new era
This didn’t sit well with a lot of people – in our view, we should have been widening access to the market, not trying to stifle it.
Therefore, with so many challenger brands looking to capitalise on new opportunities and disrupt markets, the decision to set up an independent agency that placed good service, good results and good people at its centre was an easy one.
Fuelling this disruption was the development of new technologies. The digital switchover was gradually taking hold, creating new, sophisticated targeting capabilities while transforming the customer purchase journey. Smaller, nimbler agencies saw an opportunity to deliver the strategic flexibility this new breed of brand required.
It was important, however, to find the right balance. With TV, out-of-home, press and radio now being dismissed in some quarters as outmoded, we needed to challenge the narrative that traditional media no longer had a place in this evolving, dynamic landscape. We could not forget that without the likes of TV, brands wouldn’t become famous in the first place; ultimately, demonstrating the ability to work flexibly across all media would be key.
The holding companies would eventually kick-off a new wave of acquisitions in an attempt to meet the demands of 21st century brands. But there were new kids on the block, and things were about to get interesting…
David Yorath is the co-founder and CEO of Guerillascope, an independent media agency.