4A's Transformation 2014 - March 18 - Phil Cowdell

The Future of Advertising:

“Can incremental improvement deliver the Agencies’ future or is reinvention imperative?”

What is the PROBLEM we are trying to solve?

“Ensuring our businesses can be viable and profitable as well as fun and purposeful”

CONTEXT: Everybody knows things are changing….

• Consumer behavior• Tech innovation • Media fragmentation & reinvention• Content anytime anywhere any device• Data scale, complexity and speed• Privacy and confidentiality• New trading models• Disintermediation• P&L pressure & investment timelines• Accountability needs & expectations• Changing business models• etc

CONTEXT: …less clear on when the change becomes unavoidable….

“Do I have to address this within my tenure or can we hold off until I’m safely (profitably) retired and its

someone else’s problem?”

CONTEXT: …less clear on when the change becomes inevitable….

• For lean forward adopters…which client sectors will move first; and what will it look like?– First movers: direct-response transactional industries

(finance, travel, etc)– Slower migration sectors with less definitive or timely

cause-effect linkages

• Key accelerant = “Closed loop outcomes”

MACHINE MACHINE

PERSON PERSONINPUT

INPUT

Interaction

CONSTRUCT 1:

$

High cost ad units …………………………….Low cost ad units

Volu

me

of a

d un

its

Legacypattern

Long tail

CHECK-POINT: What is the current distribution of ad-units?

$50k 5c$5mm

But how do buyers become 1,000x (or 1mmx ) more efficient…?

What does a planner do when plans dynamically evolve?

Annual Billings per Buyer

Average Ad Buy Unit

Units per Head per year

$ 10,000,000 $ 50,000 200.00

$ 10,000,000 $ 5,000 2,000.00

$ 10,000,000 $ 50 200,000.00

CALCULUS: ‘the mathematical study of change’

Mass events

1:1Messages

High cost ad units …………………………….Low cost ad units

Volu

me

of a

d un

itsVo

lum

e of

ad

units

Legacypattern

What is the evolving distribution of ad-units?

MACHINE MACHINE

PERSON PERSON

Transaction

INPUT

FEEDBACK

INPUT

FEEDBACK

Discussion

CONSTRUCT 2:

High cost ad units …………………………….Low cost ad units

Volu

me

of a

d un

its

Legacypattern

Mass events

1:1Messages

Volu

me

of a

d un

its

High cost ad units …………………………….Low cost ad units

Volu

me

of a

d un

its

Socially scaled events; with

fully integrated marketing programs

1:1 messaging: executed at

speed & scale (highly

automated)

Mass MOVEMENTS

Personal MOMENTS

COMPARABLES: Learning from others?

• Which industries have already reinvented? Why? How? – Wall St– Hollywood– Retail – Travel– Tech – etc

• What can we learn from others?• What could our journey look like?

Concept:

Ated

COMPONENTS OF CHANGE:

• From….To

• Finding the optimal ‘people:machine’ balance

LOOK FAMILIAR?

CROSS-DISCIPLINARY ‘DESIGN’ TEAMS INITIATING

High cost ad units …………………………….Low cost ad units

Volu

me

of a

d un

its

Socially scaled events; with

fully integrated marketing programs

1:1 messaging: executed at

speed & scale (highly

automated)

Mass MOVEMENTS

Personal MOMENTS

High cost ad units …………………………….Low cost ad units

Volu

me

of a

d un

its

Socially scaled events; with

fully integrated marketing programs

1:1 messaging: executed at

speed & scale (highly

automated)

Mass MOVEMENTS

Personal MOMENTS

Ated

EXECUTED AT SPEED/SCALE (AI+MACHINE LEARNING)

Concept:

“MISSION CONTROL” & REALTIME DATA VISUALIZATION

Implications:

UNDERSTANDING THE “WHY?” AND WHAT TO DO NEXT

LEADING TO RAPID PROTOYTPING & CONTINUAL IMPROVEMENT

CHALLENGE: What is the PROBLEM we are trying to solve?

To what extent this new construct can deliver against the four dimensions of the business problem?

Are the dimensions equally resolved or in conflict? What are the side-effects and challenges that will be triggered by executing this new mental and physical model?

How should these side-effects be offset or resolved?

What may be better constructs? Multiple versions, experimentation, then rationalization around new norms

When it comes to the future – there are three kinds of people; those who let it happen, those who make it happen and those who wonder what happened?

John M Richardson Jr