All of us exist in time and space, and as we move through time and space we interact with the things around us. Our lives are comprised of all the many and varied relationships we have with Time (when we are), Space (where we are), Self (who we are), People (by themselves and in groups), Objects (inanimate and living), Ideas (how and why we are), all of whom contribute to the creation of our unique relationship space. Value is created when an interaction with a medium improves the size and/or quality of our relationship space. The characteristic of the interaction with the object or an idea that makes this improvement possible is the enabling of a new behavior within the existing behavioral norm for that individual. As an example of transformation, consider the opportunities that a Link-Enabled object will have to enhance, expand and redefine the relationship space of individuals, and potentially redefine how we live our life.
Changing Mindset, Changing Capability
As an answer to the challenge: how does one make user engagement a mainstream activity for a new generation?, the FLIGHT model of user engagement discussed earlier, is a framework for changing mindset and a blueprint for a changing capability, clearly required by marketing and communication companies, and most of all by the advertising industry. The advertising industry is one of the largest on the planet, and an industry still organized under the old mass broadcast model.
In a digital world, the traditional, multinational agency model is unsustainable and inefficient. By and large, legacy agencies have not caught up with technology, and their business model, though it has globalized, has not changed much in the past 150 years.
So writes Avi Dan in Forbes, on March 31, 2014. It is as if the Internet did not happen for lots of agencies. But more so, this is not about the Internet, but about the transformation of data as the preferred material for marketing communication and user engagement.
Agencies have not kept up with the transformation of the economic model of 'produce and consume' to a new model dominated by platform companies, where people co-create and share. As every company with an audience slowly understands, they are now in the media business, as a broadcaster of content. Agencies did not pick this up and are faced with quite a few contextual challenges:
- • More and more brands are going into the publishing business, inspired by Dove, Red Bull and Oreo.
- • Digital video is exploding.
- • Mobile is exploding.
- • TV and online video are becoming one.
Everyone in the advertising business is complaining that project-based assignments have transformed the agency into a commodity, and that creative work should be seen as more than an hourly rate project. This is true, and it goes to the core of how we define today what 'creative' means. A creative word-tag does not do it anymore. As recently as March 2014, the second largest retailer in the United States posed the following challenge:
... The retail landscape has changed and consumers—more connected than ever—have increasing expectations about how, when and where they want to shop. In response, a new breed of retailers is challenging our market share. We recognize that in order to remain a leader for the next 50 years we will need to find new, innovative ways to make money and ultimately fuel growth.
The Challenge: If you were one of our executives how would you disrupt our own business model to compete in this new environment?
By any measure this is not a marketing challenge, nor is it a design challenge. This is a strategic foresight challenge. Brands are asking for strategic value innovation—in effect placing the agency at the level of strategic partner. Yet, agencies are not equipped—capability wise—to handle foresight strategy and transform it into innovation. It is very likely that brands will soon stop sending foresight challenges to traditional agencies, opting to use—at least for the strategic elements of the mandate—foresight innovation consultancies instead.
In the new context, advertising agencies will have to understand the intersection point of technology and consumer behavior, and have the capability to deliver the right innovation (medium) to a targeted behavior group. However, the intersection of technology with behavior is not the traditional capability of advertising agencies. That capability belongs squarely with Strategic Foresight practitioners. Without a manifest and credible strategic foresight and innovation capability, it is doubtful that agencies will continue receiving foresight challenges they cannot respond to, and this is a danger signal for their financial sustainability.
Michael Karg, CEO International at Razorfish, was quoted as saying:
The agency of the future will be just a consultancy. Any creative hot-shop or a well-established network will have to understand the intersection point of technology, media and consumer behavior to deliver the right creative. So companies will look at the new consultancies for advice on how to be prepared for this change and reorganize themselves. Interestingly, when this happens media planning will have a whole new meaning. Imagine the possibilities when millions of ad dollars will be saved and pumped in creating new user experiences and content.
What is the question to which an advertising agency is the answer? The answers to this question will reveal the new capabilities needed by advertising agencies, and the needs of organizations in general to be dynamic and synchronic with the emerging present society and economic system.
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-  Available at: http://www.forbes.com/sites/avidan/2014/03/31/the-future-of-advertising-lean-nimble-agile/ (accessed: June 20, 2014).
-  Available at: http://www.business-standard.com/article/management/the-agency-of-the-future-will-be-just-a-consultancy-michael-karg-vincent-digonnet-114050400690_1.html (accessed:August 9, 2014).