Saturday, October 3, 2009

The Next Challenges of Advertising

By Jean-Claude Saade

The current economic downturn is putting additional pressure on Advertising Agencies and triggering some existentialist discussions, but advertising has always been a very dynamic and an ever-changing profession. We currently have a long list of elements that advertising can easily loose and another list of new additions that is waiting to be adopted. What are the key future challenges of advertising?

Role Challenges

Modern advertising has maintained more or less the same role for over a century. The many changes in production, consumption, technology and media has forced advertising to evolve and change but practically did not alter its main role of inform-to-sell. Although some people would like to define advertising as “information mixed with entertainment with a clear commercial objective”.

Advertising main role is a business catalyst, gathering talent and techniques from all walk of life to help companies sell their products and services and build their brands. It has also been used in politics, arts, religion, non-profit and any area of business or life where we need to send a message in an attractive and informative way while making sure that it embodies a clear call-for-action for a certain group of people. Advertising has kept evolving to cope with changes in market dynamics like the introduction of new media, but it is now facing a challenge of a different nature that will probably lead to redefining the role of advertising in the business chain.

Currently, the three main roles of advertising are Information, Entertainment, and Engagement but the expectations from advertising might be changing and going beyond these three main tasks. Consumers are becoming much more informed about everything and even they are taking the initiative into their hands when they go online to get all the information they need individually or through social networking platforms.

The “Entertainment” role of advertising is becoming more and more difficult for very similar reasons. People who use to have access to a couple of local newspapers, few radio stations and one TV station are now offered more entertainment than they can handle and digest in many lifetimes. Creating advertisements that will manage to get people attention and earn a smile or appreciation for entertaining people is not an easy task at all.

“Engagement” might be the advertising role that will need more innovation and focus in the future by tackling areas like customer communities, content, total customer experience and other emerging trends.

Image Challenges

Is the advertising industry humble enough to admit that it is facing an “image” challenge? – Let’s put humbleness on the side; admitting to have a problem in the one single area that advertising people claim the highest expertise in, we meant Image, is out of question for many advertising people.

Let us call it a “perception” problem or anything else you want provided that advertising agencies will internally admit that they have deal with their own image “issue”.
The image of advertising in the eyes of clients is not a glorious and shiny as it used to be; and for a long list of reasons which are not all within the control of advertising agencies. The proliferation of marketing services, the poor delivery and questionable practices of certain agencies, the lack of influence on business results, the absence of performance benchmarks and many other reasons has contributed to the fading image of the advertising industry in general. Exceptions exist, some agencies continue to offer wonderful work and maintained great reputations; these are doing well and don’t have an urgent need to focus on the image issue like others.

One of the reasons for the Image Challenge could be the business approach that advertising agencies in general have adopted. The client “Servicing” concept is being sometimes abused and confused with something else that does not relate to advertising.

Practice Challenges

The market changes and the economic crisis are putting tremendous pressure on all sectors and all sorts of companies and they are presenting to the advertising industry another “defining moment”. Agencies have to decide between downsizing, shrinking and dying or tempting a serious re-invention of advertising that can possibly take the whole practice for another 50 or 100 years.

Exceptional times will need exceptional people and measures to deal with them. The crisis could be the best time for the industry to reinvent the whole practice of advertising, especially if it does not have another choice. Agencies can start by addressing some unorthodox practices, organize and regulate some others like pitching and poaching; and more importantly try to invent new approaches and services that can help the future of the industry like performance measurement, fair pay scheme, and talent development programs.

Final Thoughts

In the face of the biggest economic crisis since the 1930’s, we cannot settle for the same old measures from the past when we are trying to build a better future for advertising. Some agencies will close down, some others will be forced to reveal their real face to the outside world and to the market, some will manage survive till the next crisis. But few will rediscover the real creative spirit of advertising and start a whole new era for the industry.

What advertising people have to keep in mind is one simple objective: To positively influence business results –

How to achieve the above? – It is up to everyone to come up with his/her creative recipe. Continue with the same old services? Adopt new ones? Innovate and create totally new approach? – This is where genuine creativity will differentiate the good from the less good.

Advertising is a catalyst, a business accelerator, a practice where creativity is mixed with business innovation to generate better results. It is a “black box” that should remain closed in order to keep the magic inside.

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