Gustav von Sydow on digital advertising, online media and tech start-ups

Another year, another Techcrunch50. This year we didn’t present though, adding ourselves to the massive pile of fanboys.

Most companies presenting were very well polished, but still kind of dissappointment since, well I actually understood what most of them did

Seems to me that companies with products in the very early stage should really give you a “WTF – is this it?” kind of feeling. At least if a company is trying to hit it really big. I doubt that I would be even close to understanding the potential of Microsoft, Google, Facebook, Twitter etc. after hearing a 5-10 minute presentation – which often includes introduction, market, problem, solution, demo and summary btw. – when they were showing their product for the first time.

It would frankly be interesting to just see some solutions to problems I didn’t even know existed.

But Techcrunch50 is great fun, I tell you that. Nice people, decent parties and kind of unreal to discuss what Burt is up to with people who’s products you depend on every day. It’s a shame that we don’t see more European companies on stage or in the audience.

Also, I had an excuse to grab coffee with Jaan Orvet, the super awesome web maniac who’s helped us out with Copybox lately.

Next week, we’re heading to DEMO in San Francisco, which I haven’t visited before. But considering that the tradition and track record of DEMO is quite insane, it should be great fun.

To kill time before San Diego, I’m cruising along Highway 1 for a weekend in LA with the rest of Burt’s core team. Life could be worse, I guess

So I’m in Oslo, enjoying my last calm minutes before going on stage to talk about “reactive ads” and how data can be mashed up to create more entertaining, persuasive and creative ads. Should be good fun, I’ve always enjoyed talking in Norway. Only thing that annoys me is that I missed Paul Ansett’s and Brian Solis’ talks. Usually great stuff.

Anyways. Here are the slides, enjoy!

So “Integrated Marketing Communication” and “Media agnostic agencies” is still all the rage the last few years, but I can’t see how we’ll get from here (a combination of traditional agencies (print+tv+radio), pr-agencies (with many flavours) and niche agencies (web+mobile+guerilla+event+action etc.) to there (everything under the same roof). Would this have been easy, the traditional agencies would have already souped up all the emergent channels already. Which they haven’t.

The main problem with the be all-end all integrated agency is in each media there is plenty of competition for the consumers’ attention. You’re not only trying to beat your category rivals, you’re also struggling for your message to break thru in a advertising-saturated media landscape. To make the most of each channel you really need to know what creative assets you have at your disposal, how consumers are relating to your media right now, competing ads etc. And no agency will be able to satisfy these conditions in all media… and with all these new emergent channels coming at us at an ever increasing speed, who could keep track of what channels to include in your offering? And even if they were able to navigate these obstacles and know everything there was to know, noone would believe you. Remember branding 101; the strength of your brand is in direct relation to how focused it is.

Which leaves us with specialist agencies as the only viable alternative as long as the market is this unstable. Here’s how a typical cross-agency collaboration works today:

Client decides that they need to achieve some sort of sales volume/margin-related goal. Default choice? Advertising. They write up a brief (often together with their media agency) which gets distributed to their agencies, along with a rough budget for each agency. The distribution is balanced between what they’ve used previously and whatever the media du jour is perceived to be. Essentially, we get a frame, which we fill with something that we think that will do whatever the client wants to do. Also, we try to fuel our already massive egos by winning awards and industry cred

Here’s why this model is flawed.

So media agencies are at the top of the food chain. These agencies are mostly structured along the business model of getting a percentage of the media they broker. More media brokered, more money for them. Less media, less money. An since it’s a transaction based model, less overhead per transaction, better net margin. So the media agencies are motivated to suggest big bulk purchases in as few channels as possible. Which (to a large extent) explains for why media budgets have lagged waaaayyy behind what consumers are acutally spending their time doing.

In a world where media fragmentization is exploding, you would thing that media agencies would be in a very interesting position, and to be fair, a couple of media agencies are actually trying to shift their business model from relying on transactions to being consultants. But what usually happens when companies try to change their business models? Nothing.

Another issue in putting media agencies at the top of the food chain is that you might not even want a channel. You might want virals, build your own touchpoint (community perhaps?), Facebook / Open Social apps or even make your product a more efficient WOM-object. I’d love to see the media agency that says that they’re redundant. When all you have is a hammer, everything looks very much like a nail.

Instead, here’s the ideal scenario, and what I would like to see:

Companies get a rough idea of what their customers do, in terms of media consumption, social pattern, how they form their opinions on critical issues etc. They then bring in agencies and companies from areas relevant from the consumer’s perspective with creative (maybe Ideo is your savior, instead of F&B?) Since the marketer is in control of the strategy and have outlined the constraints for each appointed agency, each agency would be able to maximize within those constraints.

The discussion between marketer and agency would then revolve around execution and implementation, fine tuning how it fits with the jobs of other niche agencies and how it ties into the marketer as a whole etc. which, in theory at least, would max the net-effect in terms of balancing cross-channel and channel-specific opportunities.

Also, since the client does all the planning, I would probably be out of planning gigs