If you believe some of the hyperbole, as new ad tech and tools give brands greater ability to plan and buy for themselves, the role of the ad agency is now over. Disintermediation is the order of the day.
A recent ANA survey showed 35% of marketers expanded their in-house media buying capabilities in 2017 – twice as many who had done so the prior year.
“I generally subscribe to the view first put forward by (Publicis Groupe chairman) Rishad Tobaccowala, that agencies are cockroaches not dinosaurs – they’re very good at surviving,” says Pivotal Research senior analyst Brian Wieser in this video interview with Beet.TV.
“Even though what we’re seeing is certainly weakness and it’s more pronounced in North America than it elsewhere, collectively the industry is still growing – not by much, but it’s technically growing organically, if we’re looking at the big holding companies.”
Last year, Wieser observed “depressed ad spending growth”, driven by brands tightening purse strings, that would have “a really negative impact on the growth of the industry”.
In 2018, he sees “pockets of decline”, like at global creative agency networks, as brands question how much advertising they really need to do. And, following a couple of years of scandals which shed the like on shady industry practices like agency kickbacks and rebates, Wieser reports “enhanced contract scrutiny” driving some spending cutbacks.
But this isn’t the end of the story.
“Those things are all having an impact right now,” he adds. “I think that, as you cycle through these things, you do get to point where a rebound will eventually occur.”
This video is part of a Beet.TV series on advanced TV produced at the WideOrbit Connect conference. WideOrbit is the sponsor of this series. Please find more videos here..