Marketing: increasingly going to be encroaching on the traditional ‘management consulting’ paradigm

In the media and digital world, the name of the game these days is convergence. Convergence seems to be the positioning driving large companies. M&A activity is up across the communications industry as large holding companies buy up the best creative talent there is.

The recent merger of Publicis-Omnicom only reinforced the fact that there is massive convergence in the marketing and media services industries. Opta, the digital sports media company, was recently acquired by the PERFORM group.

Some of the more interesting activity, however, is the convergence this brings. In a world increasingly driven by creative innovation and positioning, marketing agencies/groups are increasingly tasked not with just creating great creative, but solving business problems in doing so.

This brings an interesting conflict emerging on the horizon: the crossover between management consulting, and creative consulting. And the reality is that they are often two sides of the same coin.

Management consulting means solving business problems by looking for areas in which the business process could be streamlined, refined, or restructured. Creative consulting often involves looking for out of the box solutions which achieve similar goals – perhaps through better utilisation of data.

And as digital is one of the most effective ways to scale business (no production costs, remember), it is digital agencies that are leading the charge into this strategic creativity that they are bringing to their clients.

Management consultants have already seen the threat. Recently, Accenture acquired the London design agency Fjord (http://adage.com/article/agency-news/agencies-accenture-s-invading-turf-big-time/241338/). Fjord is a typical agency holding company buy – but the purchaser, in this case, was Accenture, recognising the fact that digital meant their clients faced a strategic issue as much as anything.

And increasingly, agencies are being called in to solve business problems. Here’s a description talking about a strategy offering:

  • Define business objectives
  • What are the needs of your audience?
  • Connection between audience and your services – what are these engagement points?
  • Telling your story, branding, why us?
  • Communication with audience, customers telling others your story.
  • Ensuring consistent brand experience.
  • Thorough analysis and review.

And here is the strategy offering from another business:

  • What are the issues & opportunities?
  • What are the guiding parameters?
  • What products and services will we offer, to what customers, and through which channels?
  • How should we set ourselves up to deliver, and what needs to change?
  • How and when will we make the changes?

Sounds remarkably similar. And yet, the first was the strategic offering from a full-service digital agency, Zero, in London. The second was a management consulting firm, Berkeley’s, again in London.

What can clearly be shown in these examples (and they are top ranking Google results, for those curious), is that they are two sides of the same coin. And for businesses with limited expenditure on consultants, these two offerings should (broadly) be solving similar types of problems.

But this isn’t just going to be digital agencies moving into this area. In a world increasingly driven by clever product innovation or unique positioning (for examples of how the latter is true, look no further than Apple), increasingly business problems are solved creatively rather than by process.

And for management consultants, this is increasingly hard to grasp.

Watch this space for convergence. I predict that within a year, WPP will start moving into management consulting type businesses. Agencies increasingly are going to be called in to solve business problems, not just produce creative propositions.

It’s an exciting time to be in marketing.

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Is email going to be a future publishing channel?

Any avid blog readers will know about my appreciation for the Shortlist media model[1]. One of the emails that have worked exceptionally well has been the daily Mr Hyde and Stylist email.

Email marketing in general has been on the radar for years. Cheaper than direct to mail, they very often had a pretty standard subject line designed to get through subject lines. Most publishing websites used email to encourage existing users to come onto the site as part of their daily routine.

Looking at the broad trends, there is an interesting juxtaposition. Email open rates have increased from 22% to 25.6% at the end of 2009, but email click through rates have declined from 5.9% to 4.4% on average[2] according to Epsilon.

As a statistic, this seems to be in opposite. In the UK, however, there are similarly low figures – an open rate of only 21.47% against a click through rate of only 3.16%[3]. More interestingly was the way that in this sector, publishing bucked the trend – achieving almost 25% more than their competitors on average with 4.26% click through rate against a 21.52% open rate.

That’s a lot of difference between comparative industries – and one possible answer as to why is that publishers are able to create the subject lines and brand that enables the trust for people to engage with their EDMs.

Moreover, there are good news for advertisers: 67% of customers were willing, according to Clickz marketer Mike Hotz, to give email addresses to receive discounts and promotions. A further 57% ‘say they are more apt to buy a product in store after receiving an email’.

So before we even consider click through rates, there are some strong arguments to say that email is still an incredibly valuable and underrated tool in marketing.

And yet 61% of emails are considered non-essential by consumers. 49% of consumers subscribe to 1-10 brands, and 34% choose to receive 6 emails per day from brands that they trust[4]. This tells you that for brands – engagement and trust is important.

Publishers traditionally used their ‘impartial’ status as marketers, but not direct marketers, as a great skill to be able to generate trust in their audience – perhaps why they generate a higher click through rate than other industries.

What these statistics show is an astounding range of possibilities for the email publisher. Generally speaking, brands themselves can be far too defined to warrant an entire email of consumption – and Shortlist has shown there is a demand for a strong, daily email which can instead select and curate the brand stories you should be hearing about, wrapped around content that you are interested in.

So what is the future of the email with regards to publishers? Well, the opportunity lies in creating a compelling product that curates the content that consumers are looking for. Trust will be critical here – trust that the EDM not just delivers them relevant and engaging content, but content that will work.

For advertisers, this offering will be compelling – a way to cut through the traditional brand noise whilst maintaining a sense of product authenticity. For consumers, they get the news, content and information they want, in a convenient, easy to read format. And for publishers, they create a new channel of engagement – one that can draw people back to aggregating around their website.

In 2013, look for email publishers. They will be the ones creating waves – using email to create a strong, digitally based reach into consumers’ lives.

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