| So do agencies innovate? The seventh in our Beers and Innovations series addressed an issue that's always been at the heart of the purpose of the series. Ian Delaney attempts to decipher his notes from the session. Many thanks to our chair and panel: Frank Boyd moderated; the panellists were Nicholas Roope from Poke, Desiree Collier from Marsteller and Jamie Riddell of Cheeze. More information on our speakers is here. All were provocative and insightful. These events are not just about going to a presentation, though, and discussion points raised by every participant helped to extend and deepen the debate. Thanks, equally, to all of them. (But, no, you don't get a link ;-) )
The Problem Agencies are expected to be innovative. But there are significant issues. Nik Roope started with a useful attempt to pin down exactly what we mean by 'innovation'. Perhaps it's more useful to start with what we don't mean: it doesn't mean being creative or doing something different. For Nik, it meant making things better. He felt the term was continually mis-used: "many creative agencies just pump out banners". What's really needed are new products and properties borne from new ideas that move things forwards. Are UK agencies in a position to deliver this? No, said Roope, drawing attention to reports of problems at agencies Nucleus and Atomic over cash flow. Cash flow is a significant issue for many agencies. They need to get their jobs signed off and the money in the bank. This can make them risk-averse, which is obviously likely to stifle innovation. Later discussions echoed this sentiment and expanded on it. Eachan Fletcher talked about the 'diminishing returns' of innovation - once an idea is out there it loses value rapidly. Rather controversially, he suggested that the pinnacle of innovation is to 'create a new problem'. Rufus Leonard said that 'all too often there is not a catalyst to innovate' in terms of a client's interest in something new. Solutions I There's a glimmer of hope, though, in the recent incidence of stakeholder relationships for agencies in viral campaigns. A viral that's generated from a clever idea might not take very long to make, but should ideas be charged by the hour? What about if agencies were remunerated as a proportion of the success of the campaign? The difficulty has been in getting clients to agree to such a model. "The marketing departments are not biting," as one participant put it. One difficulty is that innovative models often require the buy-in of multiple departments at the client, which slows work down and often stops it altogether. However, one participant reported a recent deal along these lines at Orange. Lucy Ann Burke from BP said that one of the issues faced by her organisation was agencies not working together, that technical agencies and creative agencies sometimes appeared to have entirely different agendas despite notionally working to the same brief. Roope said that perhaps another route would be to adopt the approach taken by Japanese car makers like Toyota, where everyone in the company has the power to stop the production cycle and is strongly encouraged and motivated to contribute improvements. Solutions II Jamie Riddell suggested that there were two types of innovation to think about - externalinternal. External innovation might result in a funky new widget for a client. However, internal innovation - changing the ways in which you actually work - might be needed in order for that to happen. If you can develop processes that save time and improve productivity, then that has a clear benefit. and It also feeds into the chances of being innovative. If you haven't got time to do anything but crank out products, then your chances of doing anything fresh are pretty limited. So the challenge is to allocate time and resources. Agencies are never given a blank cheque by clients to spend on researching and inventing. They therefore have innovate ahead of time. Taking the example of Second Life, just flying about a bit in the virtual world isn't really going to sell the idea to a client. However, if you've actually invested time, maybe customised your avatar, mastered the contruction tools and built an office in the world, then when and if a client shows an inkling of interest then you've got a means to demonstrate the potential value of a presence in the world. Riddell stressed that this was pretty risky - with only two and a half million users, nobody really knows whether Second Life is going to be big. However, having done the research, it becomes another card in his hand to potentially play at the right time. Discussion revealed some scepticism about Second Life. Some participants pointed out that it had all been done before in earlier, long-forgotten virtual worlds. Others stated that a virtual presence in Second Life could hardly be counted as innovative, since it's been done many times already: "it's hanging on the coat-tails of what's cool". In an excellent counter-point, one participant said, "Yes, but it really depends on how you establish that presence." Innovation, it seems, isn't just about the form, it's the delivery too. Riddell said that innovation was the product life-cycle of agencies. He pointed out that there's a considerable amount of innovation going on in search engine marketing. Because that industry doesn't seem sexy to people in creative agencies, it doesn't get talked about, but nonetheless, it's pushing the market forward. It takes considerable courage to be doing innovative things because you don't know whether they are useful or not until a long time after the investment has been made. The agencies are often 6-8 months ahead of clients, in terms of understanding what's cutting edge. Some clients now, for example, are asking for MySpace accounts, when that might seem passe to anyone working in the digital industry. Even worse, with larger clients, it might take a further 6-8 months to get sign off, meaning that your innovations better be pretty startling because the chances are that they'll be well behind the curve. Riddell finished by saying that perhaps the way to lead clients into welcoming innovation is to think more carefully about what they need, as opposed to simply answering the question. Finding solutions to their needs can sell in innovation. Solutions III Desiree Collier made the point that her company Marsteller - an international PR agency - is very well-placed to rise on the innovation wave. For all kinds of companies, in all kinds of contexts, conversations are becoming key. So, in many respects, PR matters are at the forefront of companies' marketing concerns. Marsteller is in a position to be involved at different levels of the larger businesses it looks after. This can allow it to take a holistic view of the client's overall aims and try to ensure that their communications on these different levels are consistent. Public Relations companies are now hiring digital experts to work alongside traditional PRs and extend the possibilities of their offerings. One enormous advantage that they have over many of the creative, digital agencies is that they are hired on a retainer basis. It's very rare for them to be asked to produce one or two objects. This advantage helps to suggest one answer some to some of the earlier concerns about creativity - finding the time and keeping the cash flowing. The PR company's role is no longer just about getting column inches. And some of what they're doing is helping to create the conditions in which their clients are able to embrace innovation. One secret to innovation that came out of an earlier discussion was the necessity of getting as close as possible to clients' customers, something that agencies find hard to find the time and money to be able to do. Collier said that a lot of time at Marsteller was spent monitoring every aspect of their clients' communications and communications about them. This can lead them into a position where they're able to advocate models of best practice and can lead them into very deep involvement into the release cycle and positioning of a client's products and services. This apparent luxury and involvement comes at a price, of course. Consultants are expected to be experts in any new communications ideas and techniques. They need to spend time and money researching the future of communications on an ongoing basis in order to have the answers within reach at all times. Collier finished by pointing out the need for bravery in order to foster innovation. Agencies should not be afraid to question their brief if they believe their clients' needs actually demand a different solution. Solutions IV Frank Boyd recounted the story of the invention of the mouse. Stanford Research Institute came up with a prototype after considerable technical struggle. The only trouble was, once they'd produced this contraption, no-one had any idea what to do with it. They ended up licensing the design to Apple and Xerox at $50K apiece. The researcher in question apparently still wakes up thinking 'what if I had a dime for every mouse made since?' His point was that new ideas are one thing, but creating value is something very different. One issue facing potential innovators is the nature of the pitch process. To win a pitch, agencies have to have done a substantial amount of the work before they are even in with a chance of earning anything. Naturally, innovative pitches tend to involve more time and money, and so are even more of a risk. Participants also pointed out that even if their innovative pitch is the best idea, it's not unknown for their prospective clients to take that idea and work with it using another, presumably cheaper, agency. He described some of the work of the BBC Innovation Labs, part of which involves paid pitches. This is a practice that few of those working within the industry had encountered. The BBC, however, adapts the model it uses for commissioning programmes, whereby the programme makers retain intellectual property rights over the programme, and the broadcaster obtains the right to broadcast it a few times. The model allows Innovation Labs to adopt a very extensive in-depth pitch process, with four distinct stages. However, because companies are paid for their pitches and obtain intellectual property rights, it encourages innovation. Boyd was keen to establish that there are processes and a methodology to innovation, rather than it being the product of a mystical muse. Learnings The discussion continued late into the night, of course, and a lot of the arguments won't be settled any time soon. However, for the sake of neatness, I'd sum up some ideas that seemed to attract a lot of support from participants thus: a) Agencies certainly want to be innovative. However, structurally, meaning both the structure of the marketplace and their own internal structures, they find it hard to be so. b) Agencies can become stronger and more able to innovate by working with each other. Or forming loose associations with agencies that complement their own skill set to deliver 'full service'. They can become more like large organisations in this way. c) Focusing on the client's wider aims and needs can help foster innovation to a greater extent than thinking about what they're asking for today. Your need to put money in the bank might work against this, though.
d) For agencies, both the pitch process and the way in which work is paid for discourage innovative solutions. Clients looking for such a thing might consider alternative approaches such as revenue sharing, IP agreements and paid pitches. If you have blogged about the session, do let me know, and I'll link here: Innovative Agency Theory or how to get a head in Advertising Recipe for Innovation Book for Beers and Innovation 8: The Attention Seekers here. | 
0 Comments:
Post a Comment
<< Home