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According to everything I read at the moment, traditional marketing agencies (offline, online, digital etc) are doomed.  I don’t agree.

The business model of throwing money at an agency to get a revenue from sales will change. The talent for advertising and marketing will also not be focussed on several main companies/groups, but will in the end transfer to a bunch of smaller much more loose knit collaborations. The winning agency will become the agency that embraces community.

I read recently that there is more advertising budget from blue-chips going into starting and maintaining social networks (both internally and externally) and all that goes with it. However, I think that’s the right area, but a misguided proposition.  I suspect it’s been sold-in by agencies without a full understanding of what they’re doing.

Companies will never be able to build big social networks, because they aren’t trusted.  People will not join as they will feel “sold” to.  The ones that do join, are almost certainly not the people they want to talk to either, unless their long-term aim is to get those people to consume more of their product.  That’s fine, but unlikely to work, as people are feeling less and less affiliation with brand and are more and more seeking out their own personal communities.

Companies need to recognise that they need to participate in the network to build up credibility. Then recognising that they have credibility, they will need to push the idea of value… for the community but not necessarily for them.

Shareholders won’t (and don’t) like it, unless the business model is entirely around the advert model (I have the eyeballs, you pay to place something in front of them).  In the end, shareholder led companies care only about the money.  Social networks are difficult value propositions in that sense.  Control of the message and conversation is reduced. The internet makes web investment more of a gamble than more old-school industries and models, so it requires a different type of investor and a different type of shareholder.

So, advertising will - and is - become more about showing how companies can be more community-centric and community-valuable.  Unless agencies pick that idea up, and more importantly work out how to sell it to their clients, then they will struggle to retain clients.

There will always be companies that stick to the old models until new ones come along. I remember listening to a Unilever representative about 2 years ago saying that they were going to “wait and see” what happens with social networks and associated business models before deciding on whether to throw marketing budgets at them. Unilever and others appear to be the safe industries, that will throw large budgets at “tried and tested” approaches.  These are the companies with the safe investors.  These are the companies with an unimaginative view of the world.

If your agency has that kind of client, then you’d better watch out that they don’t drag you away from the future and drag you down with them.