I was recently asked by Event Magazine to comment on the following themes and it quickly turned into LEX’s first blog entry.
1. What's happening within the brand experience/experiential sector that is prompting (ad/media) agencies to look more closely at brand experiences?
The convergence of media has created an hour glass funnelling effect, focussing communications through 2 core channels; digital and physical. These are now the foundations to all brand communications and consumer engagement.
The digital channel is a heavily congested landscape of agencies delivering content and influence with limited understanding of actual engagement. With the surge of add blocking software, non-linear TV, subscription models, self-curation and filtering of content it is an increasingly difficult place to disrupt and reach new audiences.
Consumer behaviour is also dramatically changing the nature of content, especially in younger audiences, with the traditional 30 second ad and content with a high production value now instantly skipped or scrolled past in preference for a shaky piece of user generated content.
Our digital culture has fuelled the growth and need for authenticity and so the demand for live experiences is coming from both consumers and brands, adding significant value and importance to our marketing channel. You just have to look at arguably Apple's biggest announcement of the year with 'Today at Apple' launching their customer experience strategy turning all 495 stores worldwide into event spaces on a daily basis.
What reaches consumers now is completely different. They no longer respond to traditional channels, adverts and traditional PR (using print media) is proving less effective than ever. It’s influencer marketing and live experiences with real people and real experiences that engages the consumer today. A recent study by Olapic describes ‘a mere 6% of consumers continue to trust traditional advertising, while over three-quarters prefer looking at user generated images’.
Live experiences can offer brands an ability to guarantee reach with quality and depth in engagement. Ensuring experiences translate into shareable content allows brands to integrate the brand message authentically and in return for giving consumers valuable ‘I was there’ moments you will drive influence to an indirect audience at scale through their channels.
Live experiences are simply the most effective way to disrupt, influence and grow your audience in a connected world where consumers are the ones in control.
We are also starting to see a long overdue breakdown of client-side siloed marketing departments with sharp elbowed managers protecting budgets now replaced with integrated-thinking, consumer experience specialists. The bigger the business the slower they are to change but even the behemoth traditional agency networks and brands are finding ways and spinning off Labs and Collaborative Growth initiatives to answer the demands of modern business.
2. Why are they developing in-house expertise in this area? Is it client demand, responding to calls for more integration etc.., the importance clients are placing on experiences...
The convergence of media has also fuelled a similar convergence of agency capability, blurring of lines between agencies and increasing the trend of integrated/BTL agencies pitching and winning contracts off ad/media agencies with ideas that cut through the channel.
Ad/media agencies have been happy to see the perceived lower value BTL work stream pass them by, until they started pitching against those agencies. So ad agencies have to adapt to the shift in consumer behaviour, convergence of media and BTL agencies expanding their client footprint.
Ad agencies still have significant influence at the top of business so by adding this capability it is easy to divert these opportunities through their business. Converting them is not always that straight forward as the understanding of live experiences is very specialist. Ad/media agencies that don’t invest heavily can quickly create a hole in their forecast and ambition but get the formula right and the scale of success will be game changing for agency and client.
This has been a significant opportunity for businesses like LEX. Our agile business model and collaborative approach provides agencies a specialist live experience and activation capability, embedding and co-locating world class talent at affordable prices. We are seeing a huge demand to work with our trusted network giving our partners and clients the capability to deliver creatively, collaboratively, with precision and profitability. We are a collective of live experience innovators, creating concepts to influence and inspire today’s connected world.
Another reason for agencies to build this in-house capability are the flaws and pit falls of putting agencies together in inter-agency collaborations where protectionism, greedy ambitions, and the battle of agency ego damage the process, creativity, ability to innovate and ultimately the campaign results, wasting so many opportunities. This is often successfully glossed over for the eyes of clients but there is a real opportunity here for the big agencies and more collaborative business/agency structures.
3. What does this mean for traditional brand experience agencies and for clients?
Brand experience agencies need to get to grips with the opportunity and understand the point at which these two worlds converge needs a different style of thinking. Creating in a place of convergence between the digital and physical enables a greater reach into each channel and often is where the traditional brand experience agencies struggle.
LEX’s proposition, “Creating live experiences in a digital world’ and our creative approach allows us to innovate to influence and inspire the consumer world.
We are right in the middle of this disruption and agencies that don’t use this as an opportunity will be swallowed up by those who are able to adapt faster. We will see many smaller smart businesses grow fast, plenty of mergers and acquisitions by the big agencies and sadly a negative pressure on the agencies in the middle.
For clients, the landscape is already confusing with agencies continually changing their proposition and capability. I think we will see a huge growth in the Hollywood model or the ‘on-demand’ approach with collaborative businesses like Oliver, Space 66, LEX and Hoxby growing in number.
4. What does it mean for the experiential industry as a whole?
Disruption is good for industry, it will find a new balance and as the younger generations join the workforce the landscape and style of agencies will change even faster.
We will see a continued rise of investment and importance of live experiences as their relevance in today’s connected world continues to propel them into a more central role to integrated marketing, consumer engagement and social influence strategies.
The full article can be seen here: HERE
