We all fear the loss of client business. There is economic insecurity, to be sure, compounded by a more personal feeling of loss. Few of us can just walk away and get to the task of replacing business. We have to deal with the loss of a relationship. Keeping it in perspective, it’s a business relationship, but a relationship nevertheless. Something personal. Every day you put your heart, mind and labor into building your client’s business. And then they take it elsewhere. Your client’s business was your business. Your client’s brand was your brand. You cared about it.
I’m here today to talk about Disintermediation. It’s a clinical sounding word, devoid of emotion, but when you hear it, you should get that same feeling in your stomach as when the client calls to say “we’ve decided to go in a different direction.”
Let’s examine this word.Disintermediation is actually an economics term for “the removal of intermediaries in a supply chain.” In plain English that means “cutting out the middleman.”In the business world, however, definitions are rarely that simple because we hijack words and hold them hostage to a variety of meanings. (If you want to know how annoyed I am by misuse of the term “media agnostic,” just Google it and see.)In the same way, “disintermediation” has been given a number of expansive meanings.
Here are three ways you can be disintermediated.The first is that your Client replaces you with another agency. We used to call this “getting fired.”Obviously we must never fail to maintain client relationships. You all know that, and you’ve built agencies on the strength of these relationships. In a few minutes we’ll zero in on an important aspect of modern agency-client relationships, one that will help you prevent disintermediation.
The second scenario where you can be disintermediated is when a client, faced with new unmet need, brings in a new agency to either replace or augment your own services.In the days of Ye Olde Marketing you could always see this coming. It was plainly obvious when the client’s business situation required the addition of, let’s say, public relations or sports marketing. You might even suggest to your client that they hire a friend of yours who was in the business.Today, however, no one – and I mean no one – can possibly keep up with all the ways consumers and clients connect with one another.We try in vain to organize these channels in a way that makes sense in a budget recommendation.
Spider charts are an example. At first they seemed like a measure of sanity. The client could bank on the consistency of a single message, executed across all channels.This doesn’t make sense because you can’t guarantee that a consumer will see all these things. What’s more, a diagram like this supposes a “push” approach to marketing communications, leaving little consideration for the dialogue among consumers and between clients and consumers.Spider charts seem to bring clarity but in reality they are a giant blind spot. I’ve banned them from my team’s work.Spider charts are how clients use media………
…..and this is how consumers use media.Marketing communications today is like a Gigantic Venn Diagram, its design constantly shifting from client to client, and from project to project. It would be nice if all the various media would just stay still for a moment and let us plan a client’s marketing communications. But it doesn’t and it won’t. There will always be some new medium, platform or tactic bubbling up in the minds of programmers, entrepreneurs or venture capitalists.By the way, this is wonderful! The Gigantic Venn Diagram may confound us, but it should also excite us. This is the best time in history to work in marketing communications.We’ll come back to all this excitement in a few minutes, but first, a real buzz kill.
The third scenario is when a client cuts out all the middlemen and works directly with the media. I don’t mean traditional media, although that can happen, but media that can connect consumers and clients directly. Let’s start with a prime suspect....
Four years ago you could read an article like this one, “Google, Disintermediation and Agencies.” This article contains a handy, if now outdated, list of services, mostly free of charge, that Google offers to any advertiser with Internet access. Each one of these services replicates functions found in your agency. There are tools for planning, buying and measuring a search program. (Probably Matt and Jason already described these in some detail.)
So, yes, on some level they aim to disintermediate you.The pernicious part of this, though, is that they’ve done a great job positioning themselves as the ultimate mediator, or honest broker, the purveyor of completely unbiased Internet searches. A level playing field, across which a client can see her consumer directly, without having to go through the middleman.
Facebook’s Marketplace follows the same principles. You can buy ad space on a cost-per-click basis. It’s targetable, and you don’t even need to talk to a Facebook rep.In addition, this article appeared while I was developing today’s presentation. Facebook, in a joint venture with the U.S. Government, seeks to work with small businesses across the United States. This program may or may not succeed, but the intention is clear: Disintermediate you from your clients.
Disintermediation can come from anywhere, so it’s important to have good peripheral vision. In addition to Google and Facebook, there’s YouTube, which lets you build your own brand page for free, with analytics as well.Disintermediation is not just a digital phenomenon. Depending on the size of your client, and especially if they are a retailer, a radio station can come in and lay claim to your client’s budget.Valpak. Here again, depending on the size of your client, couponing might be positioned as an important tactic in tough economic times.Some of you have encountered consultants in the field of communications planning, or “comms planning” in the UK, best typified by firms such as Naked Communications. A little more far-fetched, but Super Agent Ari Emanuel started “Lverage”, a talent company that also does marketing communications.
Every trap contains its own escape route.Look closely at “Disintermediation” and you’ll see it contains the word “media”. Did you notice something about the Disintermediators we just discussed? Most of them offer solutions unique to one medium. That’s like trying to draw the Gigantic Venn Diagram with only one circle. You, on the other hand, may have your own specialty, be it advertising, retail or digital, but the nature of your work is more general than a specific medium. Who better than you, who knows the client’s business best, to be her communications planner?We often focus on “the creative” but in today’s world I’m increasingly convinced that media is equally important.
This requires constant curiosity. You’ve demonstrated your level of curiosity just by coming to BOLO. The conference organizers tell me that BOLO is an acronym for many things, but one of tem is BE ON THE LOOK OUT. I love that. The spirit of an event like this is self-improvement. Don’t let it stop when you leave. Bone up on Demand Side Platforms and understand what they are so you’ll be ready when the client says they want to put their entire budget into Google AdWords.The flip side of Curiosity is Humility. As we said before, no one can possibly keep up with all the ways consumers and clients connect with one another. Do your best to be a great generalist but realize that specialists will always be important. I am humbled to share the stage today with Lisa, Matt and Jason. They are on the front lines of Disintermediation and have a lot to offer us.
The B.O.L.O. mentality will make you a great generalist, someone who plays their position well AND sees how their work fits into the overall marketing solution you provide to a client. On my team we aspire to be Renaissance Practitioners.You can’t practice anything, however, unless your team knows how. You already have people who specialize in what you already do. Technology continues to develop daily and someone has to be on top of the changes.I believe we are in the Age of the Specialist. So much media innovation depends on technical ability, and each platform has its own idiosyncrasies. You just saw two specialists, one in SEO and one in SEM.You need specialists. Hire them, bring them on freelance, use them as consultants.
Just as its impossible to keep up with every new channel, it’s equally impossible to bet on all of them. You need to match up channel opportunities with client needs. Make a strategic bet based on what you already know your client needs.In other words, get to your client before someone else does. You know media is the key, you’ve surveyed the various channels available, you’ve found the specialists – now figure out how to use them. For example, is your QSR franchisee co-op suffering a decline in transactions? Get to them before Groupon does. Can your client, the boot manufacturer do a better job connecting with retailers to expand distribution? Get to them before someone has the brainstorm that what they really need is a Facebook page.This point is called “Do, Learn, Do” because historically in our business the approach has been “Train, Learn, Do.” Training is important, make no mistake. There is no substitute, however, for practical experience.
In sum: (1) Disintermediation contains its own escape route: Media. (2) B.O.L.O. Recognize the Gigantic Venn Diagram. (3) Find Specialists. Generalists can’t work alone. (4) Do, Learn, Do. Put it into practice. Match channel opportunities with client needs.You are best suited to help your client figure out how to spend their budget, and chances are it won’t make sense to hand it over to just one medium, even if that medium says they do no evil.Matt said earlier that consumers split their time 50/50 between online and traditional media, but marketing budgets are more like 25/75. There are reasons for that, but the ratio will change. To be ready, worry less about changing your clients’ budget ratio, and more about changing your own TIME ratio. Invest that time now and it will pay off later.