You can’t go too far without reading an article about how digital is
reshaping the agency landscape. Older, ‘traditional’ models, where the
agency held great control of the client and its brand experience, are now
giving way to the rise of brands shaped by the customers themselves. And
there is no better medium to foster this shift than digital, whose myriad of
channels allow for everything from low-cost focus group testing to real-time
metrics that, with the right analysis, allow campaigns to be modified and
re-targeted instantaneously.

The largest advertising conglomerates in the world are now doing an average
of 15-28% of their revenues through digital – and the digital outlook for
2010 is another year of double digit growth (despite a projected decline in
global ad spending for the third straight year). I believe the rise in
digital across global agencies is for two main reasons:

- It is where the consumers are
- It drives IED

The first reason is straightforward. The second represents a concept that
every agency is aspiring to own for their clients:

Idea + Execution + Distribution

Agencies, regardless of where and how they began, will need to provide all
three of these pieces to their clients in order to represent a distinct
value proposition moving forward. Disruptive ideas need to be executed
flawlessly across a campaign, then distributed at the right times to the
right audiences. Smaller, execution-driven digital shops are fighting to
gain credibility at the Idea level, and large ad agencies are stubbing their
toes trying to figure out cost-effective Execution. Ad networks handle
Distribution, but little else. And through all of this, the client still
wants just one agency.

Digital connects the IED concept because the ideation, development and
distribution are all in the same medium. For this reason, we’re now seeing
digital shops being awarded large AOR contracts. If most of the campaign’s
execution and distribution are now digital…shouldn’t the idea begin there
too?

Soon, there will be no distinction between ‘digital’ and ‘traditional’, etc.
How agencies began will be of less interest – it is only how they perform
across the IED concept that will ultimately matter.