Digital agencies are feeling the squeeze at both ends – struggling to compete for transformational work while simultaneously being undercut by technology, writes Ann Ystén.

Web and social content has moved into an era of automation. Squarespace produces pretty competent websites for $100 a month, while social content management programmes such as Hootsuite and Sprout Social will pull out statistics and even suggest popular posts.

For many marketers, these sausage-machine services are “good enough” and seriously undermine established agency offerings.

When it comes to new tech solutions for digital challenges, we’re also faced with competition from innovation labs, tech start-ups and in-house product developers, established by the likes of John Lewis in UK, and Unilever globally.

This unprecedented challenge reflects the fact that lines are blurring between communication, business strategy and products. The digitalisation and mobilisation of business requires solutions that go well beyond the marketing department.

Language of business

While agencies can provide these solutions, too many of us don’t talk the language of business and therefore never get to deliver true digital transformation.

To really challenge a clients’ business performance, agencies must understand every aspect of that client – from production and sales, to customer service and product development. By developing a deeper understanding of the business challenges our clients face, we can articulate more meaningful solutions and ensure that our offers aren’t seen as experimental or simply a bit of fun.

For example, our work on a forthcoming FMCG campaign has led to a new piece of machinery being installed on the factory floor precisely because we were able to demonstrate the business impact that would result from the investment. We were able to make the case for this technical innovation only after deep research into target group preferences and extensive conversation with the production department in addition to the marketing department.

For the launch of Peak Performance’s collection of outdoor clothing, we worked with a wide range of teams, including e-commerce, logistics, production and the company’s creative director, as well as its global market team. Without this investment to gain deeper understanding and insight, we would not have delivered work that successfully transformed their business model by establishing virtual pop up shops in remote locations.

Pioneering app

We went even deeper with Sweden’s largest broadcaster (SVT) in building a second- screen experience and pioneering app for a key programme, Melodifestivalen, Sweden’s huge qualifying competition for the Eurovision Song Contest.

We met with a range of departments and acted as consultants within a complex, cross-discipline team of professionals. The work resulted in significant changes to the TV show’s format. Only by embedding ourselves within SVT were we able to innovate, increase audience engagement and transform the show’s real-time scoring system. Our solution is now being adopted across many other formats.

“Next-generation agencies need to contribute more than marketing benefits. I believe we need to adopt three behaviours to deliver transformation”

There are other great examples of agencies making a transformative impact on their clients’ businesses. Great Works’ collaboration with Pernod Ricard to create ultra- local brands of vodka is one of them. Setting up bespoke micro-distilleries in 12 cities around the world clearly required a deep relationship and understanding of the production department, as well as the marketing side of the business.

Similarly, IBM used Grand Slam tennis event Wimbledon to showcase its data processing and analytics capability. A 10-strong technology team enabled the brand to engage with fans via data-driven, amusing and shareable content that connected with influencers and businesses in order to increase sales.

Few and far

Such examples, however, are few and far between. There still aren’t very many of us who are ready to take this route. Next-generation agencies need to contribute more than marketing benefits. I believe we need to adopt three behaviours to deliver transformation.

First, we need to put the client’s business at the centre of our strategic planning and think like business innovators rather than digital creatives. This is a huge cultural challenge.

Second, we need an everyday process that encompasses all aspects of the client’s business, giving various departments (not just marketing) the opportunity to influence the new concepts we’re exploring. As we did with SVT, we need to understand the timescales that each unit operates within and be willing to adapt the process to make everyone comfortable.

Third, we must learn how to divide responsibilities and ensure that everyone involved owns their part of the project. With so many people involved, there is an acute risk that no one will feel ownership of the project. We must overcome that risk in order to deliver true digital transformation.

In summary, the digital agency of the future needs more than technical and creative expertise. It needs business consultants who have a deep understanding of the client side and the right skillset to engage effectively with professionals from a wide range of company disciplines, including logistics, production, sales and marketing.

Only with this insight can an agency offer sharp, workable solutions. Such consultants can talk the same language as clients and will help agency teams move beyond being experts in digital strategy to become agents of business transformation.