The Failure of Traditional Advertising Agencies and what you can learn

Tips For Digital Marketing

5 Top Tips for Rockin’ it Digital Style

It’s a fact that advertising agencies have lost their cash cow status and their traditional mojo. They are no longer sexy.

For advertising agencies, “price (in constant dollars) is now 70% below what it was in 1992.  Since 2004, which was the last year that price and deliverables were in balance, price has fallen by 42% and has been below the level required for appropriate agency staffing.  Falling prices stretch agency resources, reduce quality, create client dissatisfaction and limit holding company growth.” - Darren Woolley 

Digital marketing spend has officially taken over from traditional channels.

Whereas traditional ad spend was offline, for the first time in 2018, due to internet display advertising, mobile will pass TV as the leading advertising medium in the USA, the world’s largest ad market. Mobile display ads are expected to grow by another 50% in the next 3 years.

This got me so excited that I ended up writing about the new IT Girl in digital marketing.

This is a critical tipping point, yet many businesses are still living as if traditional advertising works, as it did in the 90s. So here’s a bit of history on what happened and how we are in a new economy which requires new thinking about the how your business can become the new IT Girl.

Why did the Advertising Agency Model Fail?

The advertising agency used to be a predictable model for marketing any medium to large business. Print, TV, Radio and Billboards were the obvious mainstream marketing channels. They worked for big business when there was no social media competition. Now, social media is THE platform to be on.

This has caused a huge disconnect with advertising agencies failing in several areas. The great news is, for every failure, there’s a lesson, and they are all right here for you.

  1. High Wages, low ROI 

A local wage used to be the compensation model, man hours rather than metrics around ROI - return on investment. These days, that could mean you have someone full time JUST doing social media … and unless you are crystal clear about how to convert from ‘brand awareness’ to sales, that’s between $40k and $90k a year in manpower for a very unclear, and quite possibly poor outcome.

I invite you to reflect on your on investment in marketing at this stage, because activity is NOT the same as ROI and many businesses are still falling for it.

“The worst thing about a time sheet model is that there is no incentive for efficiencies with multiple people loading up projects and spending excessive head hours to get jobs done. Inexperienced talent end up taking longer to do most tasks and the number of hours required on the job therefore is increased. “ Anne Miles

This kind of thinking allowed British Airways to receive 76,000 complaints on FB.

Many man hours by the way is also typical of website builds. A website doesn’t take that long to build, if you know what you are doing. However many businesses fall for a low cost solution that takes a LONG time and does not include crucial elements, like branding, photography, videos, copywriting or user journey mapping.

You’ve got just 7 seconds to impress someone with your website. Your website is THE destination that will get you found online the most often, so this is now your most significant marketing tool.

Getting your website looking good, creating return on investment and not SUCKING online is our #1 step in our client journey. Saving money on your website (and we are actually quite competitive) is NOT the best way to create a return on your investment, it’s quite often the best way to create a headache that NEVER produces results.

Top Tip: Don’t focus on low spend, focus on HIGH ROI

    2. More Channels, More Work, Less Spend have Ad Agencies Exhausted

We can easily be marketing on 10 channels for just one business and doing split tested, multiple offers. That’s a LOT of variables and you need to know what you’re doing to make a dint.

While offline advertising has nosedived, Google and FB advertising now accounts for up to 75% of the total advertising spend made, and most of that fails. This is ‘pay per click’ or PPC advertising, so every click costs you money and every ad needs to be effective. We all need an expert handling each activity (which is why we only use Google accredited PPC people).

The crucial element of success here is to know your message, your market and speak effectively to the right people in a way that appeals to them. It’s no longer about what you do, it’s about attracting clients through being what they need. And again, that requires knowing your IT factor and applying it strategically in every arena.

Top Tip: Don’t fall for the trap of activity and frequency - brand awareness -  be strategic about your channels, message and use experts to data crunch, test and measure.

    3. Incohesive, incoherent strategy

Social strategist, content strategist, digital strategist and even return on investment strategist are terms that are used, in marketing now. However the definition is rather loose. Henry hits the nail on the head:

“Richard Rumelt, in his excellent book Good Strategy/Bad Strategy, defines it very clearly:

  • - Identifying the unique attributes (kernels or in marketing terms, insights)

  • - Leverage them into unique competitive advantage

  • - Create a plan to direct resources in the most effective way”

What matters is not just the strategy it’s the integration of all strategies, so that a marketing approach is a business approach.

We think of it as a kind of Enterprise Architecture for business. Present state, future state and vision, discovery, definition, clarification, then a path on where you want to go to achieve the results you desire.

Top Tip: Business and Marketing Strategy must go hand in hand and be ROI focussed.

DOUBLE DIP SAUCY TIP: The real sauce on this to make it SEXY is depth. Don’t just solve a problem, smash it, give it all, be brave and fearless. Reference and use case studies.

  4. Measurement

Google isn’t the only measuring stick, nor is man hours. ROI is a far more complex beast, because part of the value of a brand is visibility, part of it is uptake and part of it is profitability. A viable marketing model considers this and does the data crunching, which is a deviation from traditional advertising agency thinking.


Traditionally advertising agencies focussed on the look and feel, making it SEXY, thinking about the consumer, but not necessarily taking responsibility for data crunching and being agile in creating success.

That no longer works in a crowded marketplace of accelerating activity and diminishing returns. 

Creativity still matters, but unless you can anchor the discussion in measurable data and results, your creative idea is worth nothing.” -  Keenan Beasley

    5. Traditional Marketing and the Omni-channel Approach

As a business, we focus on brand strategy, absolutely. It must be in everything you do and created in a way that is clear to your ideal client. However, that is PART of your marketing. 

Many businesses fall for the confusion of activity OR constant sales equating to a result. There's a difference between brand awareness and ROI, and there are key activities that will get your business seen, and some that will have very little impact. 

All of your activity needs to be both helpful and to head your client in the direction that you want them to go.

That might seem obvious, however it's quite common to see people either saying 'buy my stuff' on their Facebook page with 100 likes and it only gets seen by 10 people, with no results.

It's also quite common for people to demonstrate the lifestyle they have as a result, again with no specific outcome, because there's no reason for people to move in a particular direction. 

Creating longer trail, deliberate messaged pathways for people to love you is the crucial step in today’s marketing landscape. The fastest path to doing this well is through business automation.

More than that you must have a time efficient, omni-channel approach.

Marketing Experience

Getting traffic organically to your website requires links from your socials to your blogs, offers and opt-in activities.

Every business NEEDS SEO, so that Google will allow it to come up in search engine results.

To ensure success, business automation and copy need to be expertly crafted and at the core of your offering in every piece.

Your branding needs to also be consistent and on point. Then you measure, test, measure and tweak, measure and scale.

In short, all your marketing has to move from a B2B or B2C mentality to one that is focussed on Human to Human relatable, worthwhile content. 

Top Tip: Only use marketers who focus on UX, SEO, CJO Marketing AND ROI

Choosing a Winning Digital Marketing Agency

We’ve spent 3 years and $150,000 of OUR OWN on marketing to get the people, systems and services in place for our ideal client. We want you to win.

PLUS we’ve been working with businesses to create their brand and strategy from scratch, through many different industries. We create brands and help with marketing AND we focus on your ideal outcome.

Your ideal outcome is to get a return on your investment. It’s to be the next IT girl, to be the go to and to effortlessly create a flirt, a sexy and yet relationship building presence online.

Here’s what to do next:  

  1. Review your marketing and make sure it aligns with your business
  2. Make sure your website and socials are the right ones for your profitable client
  3. Only  focus on ROI activity.

Can you think of anything else that you need to do? Let everyone know in the comments below!

About the Author Emma Sidney

Emma Sidney is a copywriter who captures the essence of her clients thoughts and aspirations and translates them into real identifiable results online. As a digital strategist and thought leader Emma takes the content and powerfully adds value through context while explaining the digital space exceptionally well to her clients. Everyone wins when Emma writes.

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