Digital Revenues shall cross the Conventional
This year, the revenues generated from digital media for the agencies should be able to supersede the total revenues that shall stream in from Conventional Media. And while I do know that Digital is less than 20% of the total advertising revenues in India, I shall still stand by this prediction and let me tell you why! Let’s say a client runs a campaign that’s worth Rs 100. Here, the conventional agency generally gets about 2 % for media and 1 % for creative. Evidently therefore, almost 97 % of the revenues that they spend end up with the publishers. Now, when that client spends that same Rs 100 on digital, the agencies end up with a 15% commission apart from charging for other services too such as content creation, social media, SEO, analytics, social media listening, web design, usability and multivariate testing amongst others. Consequently, digital agencies end up attracting as much as 30% of the client’s media budget towards these services. Thus even with 20% of the billing, digital revenues would be Rs 6 out of Rs 20 ( 30%) while conventional media revenues would be Rs 2.4 out of Rs 80. (3 %).
Digital will move beyond marketing
Consider this: a couple of months back, iProspect Communicate2 helped one of its partners acquire as many as 125 customer relationship managers. Now generally, this client would invest up to Rs 40 lakhs for such talent acquisitions. Now with iProspect Communicate2 on board, we were able to help them achieve that same number in less than Rs 1.5 lakhs – the investments made by them toward digital media. Now, this experience allowed iProspect Communicate2 to setup a new division that specializes in leveraging Digital Marketing toward talent acquisitions for HR departments across companies. This division’s expertise shall help companies acquire talent, craft education initiatives of talent and understand the talent landscape through social media listening. Understand. We are living in the Digital Age and agencies will have to help clients use Digital beyond Marketing. For instance, clients can use digital for product development, information dissemination, understanding consumer trends and many more.
Conventional Consulting Companies shall enter the Digital Consulting space and face huge challenges
Currently, most conventional consulting companies are used to creating a strategy-led blue print solution for their clients which the client are expected to implement over a stipulated number of years (anywhere between 1-5 years). Now, this is quite unlike Digital, which is too dynamic a medium. Here, one needs to take a compass-led approach to get the direction right. Not to forget, it also needs to handhold the client through their entire journey. Therefore, only companies who are open to getting their hands dirty through “execution of strategy” will be able to deliver value to their clients.
Agencies will have to move beyond Digital Platforms
When one devises a Digital Strategy for a client, that strategy should never be limited to Digital Platforms alone. That strategy has to combine both the Digital and the Physical world and thus become, what I call, a “Digical Strategy”. Here is an example: Currently, we are helping a partner execute a ‘physical’ competition between stand-up comedians, singers etc. Here, while the auditions and selections would be made on the digital medium, the actual competition will be held on “Physical” grounds. Yes, the promotions and video views of the competition would be digital again.
Age of Collaboration
We are living in an age where collaboration between companies is critical to success and agencies are in the best place to guide these collaborations. For example, we have helped our real estate clients such as Lodha collaborate with Remit2India to reach out to the NRIs; we have also helped non-competitive clients to share their cookies for more targeted advertising. Our ability to think of innovative collaborations gives us a huge competitive edge. The collaboration can be physical, digital, data and knowledge-led and not just limited to collaborations for customer acquisitions alone.
Competition will not be about clients but talent
I started this company more than 17 years ago. Competition always meant someone taking our customers away, But from hereon, the next few years is not going to be about losing customers; instead it will be more about losing talent. Agencies who are able to acquire and retain talent shall rule the world.
The author is CEO, iProspect Communicate 2.