Originally posted on the ANA Blog: Marketing Maestros on March 18th, 2021

When Martin Sorrell created the first advertising holding company in WPP in the late 1980s, the rationale was based on each element of a full service agency being able to operate its own P&L, and drive the business function of media or creative to maximize skills and margins. It was during a time where media was mature, creative started with TV, and data and attribution were “nice to have '' elements of success. Video was something your Dad did with the latest camcorder, and data-driven, programmatic and social were not marketing terms.
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The Experiment In Agency Specialization Is Past Its Prime

These creative and media silos have not fared well in our digital age. Creative remains divorced from media in most companies, leaving the performance marketing team — the ones with the biggest budgets and most ambition to test and learn — with limited access to the infinite number of versions of each ad that they need to make their media plans work. For a deeper dive into why these silos don’t work anymore, here’s the challenge:

• Media teams are always waiting for the creative. Talk to any media executive — you know, the ones that manage tens or hundreds of millions in ad spend — about their biggest challenge. They will complain about CPMs, attribution and cookie degradation. But universal to all of them is “I never have the creative assets I need when I need them.” Why is this the problem? Because while the creative team is excited to develop the overall campaign idea, when it comes to cutting that down to the formats needed for each audience and placement, they balk at the labor-heavy effort to create the dozens, if not hundreds of placement-specific sizes and audience-specific messages that the media team needs.
• Usually, creative teams don’t take data into consideration early enough. When a client drafts the initial creative brief for the agency or in-house team, they start by asking for the big idea. Agencies pitch on that basis, and focus on the theme that will help the brand stand out. But consumers have sequestered themselves into their preferred silos for content and context consumption, and have stated repeatedly that ads tailored to their interests work the best. So while the “big idea” is what the creative team focuses on, the mass market is an increasingly elusive “audience” defined by data about who and where they are.
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In-House Agencies: The Wedge Issue Driving the Need to Change

The Content Factory by Coca-Cola, BBC Creative by BBC or Yellow Tag Productions by Best Buy are examples of large in-house agencies that have been built by big brands, media firms, and retailers over the past few years. According to IHAF, 72 percent of companies have in-house agencies up 12.5 percent from 2019. Having everyone focused on the same results reduces the gaps in communication and ensures that there are shared goals, in addition to lower cost and more oversight of talent. Is not perfect, as marketers still don’t find everything they need with an in-house team.
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Gluing the Agency Gangs Back Together

Getting the right “big idea” created, having that idea produced in all the relevant sizes and slices, and optimizing for the best ad content requires stitching these two functions back together. It's already starting to happen. WPP has merged some of its storied creative agencies like J. Walter Thompson and Y&R with digital shops Wunderman and VML respectively to bring data and ideas closer together. But notice that while they are tying together most of the ecosystem, Group M remains an independently run media unit. Creative shop Mother launched its own media agency — dubbed Media by Mother — led by Accenture and WPP vets.

But merging agencies isn’t the answer by itself — that is just a reversal of the same financial decision-making that led to splitting up these agencies in the first place. In bringing media and creative teams together, it requires the right mix of people, AI, collaboration workflow, or bottoms-up data sources, is the mortar that will cement these teams back together:

Staffing the right people Is fundamental to bringing these factions back together. A combined media and creative shop will be best served by teams that reflect each other's skills, rather than misunderstanding each other. If everyone decamps to their analytical or artistic realm the joint effort winds up being superficial.

On the technology front, there are three keys to a better agency outcome:

• AI that improves the production and placement effort, because it allows people to scale their expertise into execution, and get creative and media actions to happen more fluidly.
• Collaboration workflow, so that ideas, assets, and edits can happen within a single system, within the agency but also with clients and their internal constituents.
• Bottoms-up data, to increasingly understand the consumer first, and create big and small ideas that appeal to the audience being addressed. When creative and media teams look at the same datasets, the consumer who wants relevant ads wins.

Bringing creative and media agencies back together will help correct what is lacking today in digital advertising, in terms of memorable, creative campaigns. Advertisers, and consumers they cater to, will benefit as a result.