The Rise and Fall and the Coming Transformation of Madison Avenue. What about the Future of Advertising?

futurelab default header

by: Idris Mootee

WPP finally decided to fold (or merge) the agency Enfatico created only to serve Dell after 16 months of operations. I never quire understand the rationale and the logic of doing that. Now it will become part of Y&R. This may have something to do with the current climate but it is destined to fail. I’ve never seen something like this can work and you might as well brig it in-house which we understand the pro and cons of doing it.

From an agency perspectives, sure they will tell the client they can outsourced the creative and production but with control over the agency’s operations and may be some cost savings. Not sure how the cost savings can be real. It is always important for an agency to be independent of the client from both ownership and management. Large agencies are getting desperate to cut deals like this I supposed.

Madison Avenue has come a long way. Since the emergence of modern advertising in the 1920s, defined by the shift from text-based to visual advertising and the use of psychologically sophisticated messages, ads began to resonate powerfully with consumers. Madison Avenue represented the new and the modern (until the emergence of social networks and media), and ads helped consumers figure out what they needed to live a certain lifestyle. Consumers were eager to embrace the cultural authority of Madison Avenue. But by the late 1950s, they were feeling differently. Along with affluence and increased security came an increased awareness and criticism corporate conformity in the workplace. The contradictions of 1950s culture were beginning to emerge, and one of them was the inordinate influence advertising and sales appeared to have in our culture. The big shift is they are far less influence in our culture today and technologies have taken over the role. The emerging social networks are still in its early days shaping how we connect, communicate and create social identities.

The collective work of the Frankfort School, represented by Theodor Adorno and Max Horkheimer, and their classic 1944 piece “The Culture Industry: Enlightenment as Mass Deception,” provided the intellectual foundation for this critique. The imperatives of the production side were central, and in both consumption and production, consumers were relatively powerless, even “manipulated” and victimized by advertisers. In these accounts, the powerful and active agents were corporations, not individuals. Today, we can see that this is changing, with an over abundance of almost everything and the growing influences of social networks. Finally, power is switching over to the consumer.

The "de-legitimization" of modern liberalism, paternalist state policy and Keynesian economics continued to undercut the consumer critics. The growth of corporate power was accompanied by an ideology that posited the reverse—namely that the consumer is king and the corporation is at his or her mercy. Even though we are all trained from the earliest ages to be consumers, and though our identities are deeply bound up with consumption choices, social networks are gradually becoming the medium that define our identities. This is the world we live in.

A TV campaign can only go so far in building a brand. In fact, it doesn’t build brands, it merely builds awareness. Social media enable advertisers to cultivate brand engagement where interactions take place. Power is shifting from mass communication to social interactions. In just a few years, you can expect the whole advertising industry to be in full crisis mode, driven by continuous innovation. Forward-thinking marketers are embracing new models, which are being shaped by digital media.

In this world, consumers will listen to marketing messages when and if they’re relevant to them. As TV audiences’ fragment and move to more portable media, TV will no longer be the prime brand-building tool. Marketers that excel will be those that recognize that they’re now in a service business. Many marketers also have competencies rooted in interruptive communications, which is declining in efficiency and more importantly, effectiveness.

Twenty-first century marketing will instead be only about customer engagement and adaptively integrated marketing (not a new word but hardly delivered by agencies). The Enfatico story did represent an effort to tackle a longstanding industry problem. Big big marketers such as Procter & Gamble, Johnson & Johnson and Unilever are expressing frustration with the way ad and marketing firms are structured. Many marketers say it is tough getting different agencies to understand the new world order, let alone to make work ingtogether — even ones owned by the same holding companies.

Original Post: