The year was 2007, Google was well established, Facebook was on its way to capturing your imagination, Twitter was just a year old and YouTube was just about acquired by Google. The buzz in advertising agency circles was ‘digital marketing’ and the prospects it held. In spite of digital marketing being around for more than 5 years now, agencies were still contemplating the nature of the beast. Most large network agencies ignored it as they did not want to chase digital marketing pennies in lieu of the offline marketing dollars. The rest as they say is history, the digital medium was a beast unleashed and in the next 5 years completely changed the advertising game, nimble startups with disruptive services made major inroads into the brand’s wallet and the large network agencies had to play catch up by shelling out huge multiples to acquire them and jumpstart their digital practice.
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15 years on, we are now on a similar cusp in the advertising world. Digital today is the dominant spend category, TV & print advertising is declining steadily and the pandemic has helped exponentially increase time spent on digital mediums across platforms. All the big network agencies have pretty much completed their round of acquisitions and are leaders by size (not quality) in the digital marketing space today. Meanwhile, we are witnessing a slew of new-age startups in the advertising space. These companies are combining the power of tech, data & content to offer deeply differentiated services for new-age brands as well as the old established brands that want to talk to the new age consumer. In the past few years brands have quickly moved on to adopt new digital services like Influencer Marketing, Programmatic media, content for commerce and many more. Barring programmatic media services, most agencies today outsource the new age services to agile startups. In the context of all this, we now have Web 3.0 upon us and the Metaverse is the poster boy of this era. As always clients are setting the pace of evolution by demanding Metaverse services from their current agencies and most of them are grappling with these new opportunities.
Life in the advertising world has now come a full circle in 15 years. Today’s digital agencies are facing the same conundrum mainline agencies faced then. At one end of the spectrum, their bread-and-butter services of social media content & management is fast becoming a race to the bottom and at the other end new-age startups are eating away at the client’s wallet with their newer and better services. The Metaverse with its immense opportunity for brand immersion, gaming integration, Augmented reality, newer revenue streams with NFTs has made brands sit up and take notice. Some categories like luxury & lifestyle brands have already taken the plunge and it’s only a matter of time till key sectors in the UAE like real estate and tourism jump onto this trend. This time again the startups are far better placed to leverage this than your traditional digital agencies.
My prediction is that the pace of change will be very rapid this time around and most digital marketing agencies as we know now will disappear and in its place will emerge smarter, tech and data-led content-centric companies. Bloomberg Intelligence has just forecasted that the metaverse will represent an $800 billion market by 2024, companies like Unilever have already formed their own “Web3 consortium” internally to look at ways to rise to the challenges presented by the Metaverse and how they can leverage this for their brands and consumers alike. Brands entering the Metaverse will demand an agency that is equally at ease with tech as it is with the creative output. Designers will be forced to design for the Virtual world and collaborate equally with techies as they will with animators. Account management teams will need to be well versed with the gaming world, cryptos and NFTs as much as the branding universe. Writers will have to unlearn snappy social media posts and rediscover the art of long copy as they guide consumers through the various levels of the Metaverse. Data scientists will replace traditional media planners and most vanilla services like social media management, basic content, SEO will all be taken in-house by brands. Also, The creative teams will have to think about how brands can be integrated into core influencer marketing content ( not just forced placements) and most of them will have to evolve into being influencers themselves with a greater understanding of the content platforms they are creating content for. Be assured this is definitely the beginning of the end of the digital marketing agency of today and the Metaverse will hasten its demise. In its place, the new-age digital marketing companies will lead brands into their journey to the Metaverse & Web 3.0. And will emerge as dominant forces for this decade.
