Having just read both The New York Times and The Drum’s responses to Accenture’s purchase of Droga5, I’m left with five quick takeaways on what it means for the industry I’ve been a part of for more than 25 years.
Let’s start with money, and get that out of the way: Every business decision is based on money. So yes, David Droga sold to Accenture for money and the opportunity to make even more. But again, no matter what inspiring quotes are thrown at you, this decision was about money – on both sides. There’s no need to debate that fact.
The importance of independence is a more interesting conversation. Having spent time in both independent agencies and those held by holding companies, it’s not independence in ownership that makes the difference. It’s a culture of independence that makes for a great agency. Each person believing they can make the brave decision, not just the expected one. And yes, that can happen within holding companies – it’s just much harder.
Culture is the secret sauce that truly distinguishes one company from another. Agency cultures tend to push the edges of business more than other types of companies, but not all of them. And an agency’s culture is simply a reflection of the founder/owner*. From what I can tell about David Droga, he likes to challenge what “advertising” is and how it gets made. So this is the next step in his evolution, and my guess is he will stick around for a while to prove that his culture can remain intact.
The asterisk by the word “owner” leads me to my next thought: Holding Companies. Accenture, Deloitte and the other consultancies are the new holding companies. And the reason agencies within the traditional holding companies are so fearful, is that these new holding companies are led by people who understand business and strategy, not just finance. So they are far better positioned to help lead businesses as they look to change.
Lastly, I’d like to talk about creativity. Both articles talked about whether or not creativity in marketing was dying, and if this sale will accelerate that trend. Here’s the reality:
Creativity takes courage. The more knowledgeable you are about something, the more courage you have. Creativity relies on decision-making. When people are encouraged and supported for taking responsibility, decisions get made. Creativity takes trust. Trust comes from having shared goals along with open and honest relationships. And creativity takes disruption. If merging together a highly awarded advertising agency with a global consultancy isn’t disruption, then I don’t know what is.
So will Droga5 change post merger? Yes. But if you aren’t changing your model right now, you are assured to die. Their creativity will also change as they look to “help clients reinvent how consumers buy their particular products and services.” (Brian Whipple in the NYT article). And data may very well begin to replace human insight. But that might be what is needed to navigate the new marketplace.
For some of us who have chosen to remodel ourselves for the “traditional” advertising needs – having these big players move out of our pond is a welcomed sight.
Here at Dunn&Co, we are constantly evolving to meet the ever changing “advertising” needs of the clients we have, and those we seek to have. The fact that we do everything under one roof (strategy, media, digital, social, production, event, etc), gives us the flexibility to constantly disrupt our internal model to leverage creativity in new ways. Our independence means we can do what we believe in, and decide along the way what is right for us.
What is the cost of losing that, and is it worth it? Droga 5 is about to provide the answer.
Lee Davis – Managing Director – Dunn&Co.