Written by Allison Casas
The turning wheel of the media industry has been ongoing for decades, converging the traditional routes of media, into the familiar digital technology we use on a daily basis. The detonation of digital media has discarded the old media-sharing ways and created a modernized platform for newer digital emergences i.e. virtual reality and artificial intelligence. Big branded companies are taking advantage of such available platforms that are increasing higher success rates for target market reach and minimal costs. While digital has overall perks for both businesses and consumers, it challenges the necessity for physical media agencies. Will there be a need for marketing or advertising agency professionals working inside them?
Traditional media agencies VS in-house media agencies
Traditional mass media has rapidly changed from what previous generations have been accustomed to. Even today, the offline media (televisions, billboards) have declined in favour of adopting digital usage from Television to Netflix, Print ads to Instagram sponsored posts. Focusing specifically on marketing and advertising agencies, we take a look at the comparison of traditional and digitization business models. The insight into traditional marketing/advertising media comprises of having consistent communications between all the agency professionals and clients. One of the important aspects within this interaction is the emphasis on collaborative between all parties. The original business model to collaborate between brands and marketing/advertising professionals maintain their interpersonal connections through independent agencies and in-house agencies. An increase of the in-house agencies who are owned within major companies such as Coca Cola with their in house sector labelled as ‘Content Factory’. The simple logic of in-house professionals already working within the brand company simplifies the business model to committedly produce projects, and withdraws the work handle of juggling between multiple brand clients altogether. An increase of 27% of brands alone cut off using a traditional agency and opting for their own digital marketing usage in-house instead. The opportunity to utilize different business models with discarding the unnecessary use of media agencies can ultimately affect the decline in needing one.
How Produsers have created a new business model
Modern millennials who grew up with digital technology have second nature knowledge utilizing how modern media works, acting as produsers to the online world. Produsers is combining both the idea of producing and acting as consumers, creating a new alternative within media industry interaction. The increase of social media influencers have established new digital produsers to create an entrepreneurial pathway and build a new business model. Depending on which influencers and their following size, they can independently seek or be found to promote branded products. This popularized trend for audience integrations and influencer power again eliminates the media agency use. The expansion for further growth inside digital marketing/advertising is set for continual growth with Virtual Reality and Artificial Intelligence emerging as demanding digital marketing channels in the next five years.
Tribe: The new age business model leading the way
The disruptive turn from offline to predominantly online media has seen creators seek a more simplistic approach for produsers to have individual control and eliminate media agencies as intermediaries. An Australian radio host Jules Land has established an app that does exactly this. This online platform has revolutionized an entrance to completely rearrange a functional business model, benefitting both produsers and brands. TRIBE works as brands, startup or renowned, to set out an outline brief of how they envision their product to be captured. Micro-influencers can then replicate their own version of the campaign brief. It is then the brands decision to select and approve their content, purchase it, and share it to their following base. One of the surprising choices to target micro-influencers ties in brands using the same expenditure they would on a major influencer, and selects multiple micro-influencers, causing a larger target reach. As TRIBE creates the innovative path for newer business model strategies, it has yet to develop further with spending more effort in technology products and further features.
The future of media agency and where it will go
The inevitability factor that many companies are going to overlook what was once the original business model within the industry and adapt to current ones overtaking the marketplace. Transitioning to digital platforms has not only created better audience integration but has also placed a strain on the media industry, highlighting the concern if this is the end of physical media agencies entities for marketing or advertising. A second concern attached to this idea is ‘what will media and communication students do if the media agencies are on their way out?’. It is safe to say traditional media will still maintain a place of value over the next decade. Both offline and digital worlds are two synergies that still need to coexist in before the world adapts to all things digital. As difficult as it is to place a time period on when traditional media agencies will be gone, there are few elements any student will need despite using the traditional or different business model your workplace may follow. Personalization between brand and product, brand/product transparency to consumers, and incorporating agile marketing. If you are able to demonstrate these skills, this will give you an advantage in the workplace in the marketing or advertising field.