Interviews, insight & analysis on digital media & marketing

The Innovation Conundrum throttling our industry

By Digital Transformation Consultant Dave Katz

Last year, I kept hearing the same piece of feedback from the people I was working with. 

It was a piece of feedback that seemed to be creating a really important negative spiral, that I don’t really hear anyone discussing. We are an industry that has thrived on change, disruption and innovation, and yet, there seems to be a massive conundrum.

Allow me to elucidate – whilst conducting in-depth interviews with local Heads of Digital for several different global advertisers in around 20 or so markets each, and whilst training on Digital Transformation in four or five countries for about 30 other brands, I was often privy to the same complaint from advertisers. 

It’s also a complaint that infuriated me, given that they were essentially complaining about the inability of agencies to service their needs – something I was once in no small part responsible for, during the five years that I was heading up the supplier relationships in digital for one of the major agencies. 

‘We never really hear about anything innovative’ was the thrust of the gripe; ‘our media plans are always the same, there’s never anything different’. 

Well, it was not my job to challenge this or represent the agency point of view but it rankled with me.  Far be it for me to sympathise too greatly with agencies – I spent ten years in that system myself, have spent five years selling in to them, and at least as many judging them – but I think there is a self-defeating situation at play here,  one which I think it is worthwhile to shine a light on and see if we can resolve.

 The innovation Catch-22

I remember my agency-side client conversations around ‘this amazing new idea I’ve heard about from this brilliant start-up from Florida/Israel/ex-Facebook guys/behavioural scientists.”

The conversation might have continued something like this:

Client – “This sounds really interesting, is it going to work?”

“Well – I can’t guarantee that it will, but it looks great, I think the only way to find out will be to try it.”

“Hmm – ok, well have you run it for any of your other clients and were they impressed with it?”

“Erm…… well it’s new, I wanted to bring it to you guys first,  it’s a startup business, what they do is really cool and I think it will benefit you.”

“oh – so we’d be the guinea pigs?”.

“Well – the thing is, that you’ve said before that you want to hear about new innovations and technologies.”

“OK, so I’ve heard about it, but let’s see how they are doing in 6 months’ time, we can’t afford to divert any funds from the performance activity, you guys have only just got it working, we’ll miss targets if we take even 10% of the budget away. We don’t want anything new on the media plan now that it’s working, and I’m keen to drive your fees down and get better value for money.”

And you can guess the conversation six months later. It would often begin with “I see in the press that our main competitor just ran this amazing campaign with this great new startup. The reason that we are firing you is that you never bring us any innovation or smart ideas”.

“……………but that’s the company that we showed you………….. we tried to get you to invest………..”

Frustration!  The Innovation Conundrum!

So, what’s the solution?

The startup wants to get budget. It has created an amazing new piece of tech or media solution.  They go to agencies, and it’s hard for them to get in the door. They try the conventional way (cancelled meetings, pitching the junior guys cos the senior ones have to go to client meetings at the last meeting, lunch and learn session that they have to heavily prepare for, bring along lunch for 30 which many of them turn their noses up at but costs them a relatively large amount) – all to spend 6 months never getting on the media plan because of the dichotomy above. Or they know a few clients directly, which means they can circumvent the agency, which then stonewalls them.

For the agency, they bring the innovation to the client, but the client usually doesn’t want to hear it and makes them feel like they are not servicing them properly, so they stop doing it.

And for the client?  Well they want to hear about it, would love to be able to do it, but have enormous pressure on budgets because the rest of the business is on their case to deliver results today and often without much consideration for the future.

We are an innovative industry, but the innovation conundrum is starving us of the very innovation we need to flourish.

Perhaps we need to take the enforced pause of the current crisis to work out how we fix this. All our futures could be resting on it.