Mind Matters News and Analysis on Natural and Artificial Intelligence

The Death of the Ad Agency Was Widely Publicized

But, like so many industries, advertising turned out to be weathering the digital storm after all
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The Human Advantage: The Future of American Work in an Age of Smart Machines by [Richards, Jay W.] In his book The Human Advantage: The Future of American Work in an Age of Smart Machines, Jay Richards examines the workplace disruption automation has brought. Advertising is one industry that much business lore consigned to oblivion, on account of the migration of advertising from traditional passive media like television to interactive social media. The 2016 television ad spend was down to $17.8 billion from $19.1 billion in 2013–14 but digital ad spending increased by 13.2% But then the public responded with ad blocking.

One outcome is that the storied culture of the ad agency, often portrayed in films, felt threatened in an all-too-familiar way:

This deserves its own essay, but the fact that agencies are now tasked with running a business on these dead-end revenue streams has given rise to an unprecedented level of freelance staffing. Many of them are wonderful people. They are talented and yet won’t be around long enough to warm a chair. This army of freelancers floats from shop to shop, taking care of the latest surge in work. The challenge is, now the very same mob of talent is doing a broad cross section of work at different agencies on all kinds of business. It’s no coincidence that people complain that all advertising looks and feels the same. That’s the dilution of culture in action, because these days, a lot of that work is being done by the very same people. Markham Cronin, “4 Reasons the Death of Agency Culture, a Vital Differentiator, Is Near” at Adweek (September 26, 2017)

Before we write Do Not Resuscitate on the ad agency, however, lets pause to remember how many bestsellers, feature films, and sitcoms its culture generated over the decades.

Leopold Bloom, the central character of James Joyce’s controversial 1922 novel Ulysses worked for an ad agency. Sloan Wilson’s Tom Rath in The Man in the Gray Flannel Suit (book 1955, film 1956) made the term “Madison Avenue” a culturally familiar synonym for advertising and public relations.

Then came Madison Avenue (1962) and Network (1976) where advertising money is the background to villainy. There were social protest films about that too, like A Face in the Crowd (1957) and The Arrangement (1969), both by Elia Kazan. It’s probably not an accident that the struggling alcoholic in Days of Wine and Roses (1962) is an ad executive. So is the divorced father in Kramer vs. Kramer (1979).

Even the husband of the witch in the sitcom Bewitched (1964-72) was an ad man, as were the characters in ABC’s thirtysomething (1987–1991) (Ad Age Encyclopaedia), 2004 and the characters in Mad Men (2007–2015), which is set in an agency in the 1960s. The husband of The Incredible Shrinking Woman (1981) is also an ad executive who is “so busy pitching products to consumers that he barely notices his wife is the size of a Barbie doll. So is the father in Cujo (1983) and Mel Gibson in What Women Want (2000).

Why has the ad agency been so prominent a theme in our literature and film? There is, of course, a practical reason: An ad agency setting means that the product that forms the backdrop or point of conflict in a story is an idea about something rather than the thing itself.  

Suppose, for example, we set our story in a lumberyard. The dominant feature would be Lumber. Lumber everywhere. Massive noise and choking clouds of dust. But if our characters work for an ad agency that is creating a campaign for the lumber yard on the theme of “Do it yourself, with help from our pros!”, we need introduce only as much lumber as is convenient for our narrative.

Of course, the attraction of the ad agency as a setting went well beyond that. There is the excitement of the campaign, the ethical quandaries, and the high-level intrigue where violence is a possible but not essential plot element. Will we lose all that to Facebook and Google?

Before we pull the plug, let’s check for breath.

Wait! Advertising is not over. It’s just becoming very different. One writer on social trends and technology looks for industry groups to become much smaller, faster, and more targeted:

Companies are shifting their attention away from the top of the funnel and towards the middle of the funnel. Even the smallest companies have premium design, commerce and advertising capabilities.

They’re tracking consumers with personalized content, they’re following them across the web, and they’re re-targeting them. David Perell, “Death of Advertising Agencies” at Tweetstorms

That’s an often-overlooked change: Great graphics no longer require huge budgets, just lots of talent.

Sometimes, preconceptions cause the good news to be hidden in the bad news. For example, we read that companies are starting to bring  advertising in house, to enable a more rapid market response. But they still need expert employees. We hear grumbling that agencies are now forced to compete with a “legion of freelancers.” But that’s probably an outcome of the greater need to move swiftly and it doesn’t mean that the freelancers don’t have work. Google and Facebook, who sop up most of the ad budget, also hire people with advertising-related skills. But the labor statisticians consider them “data processing” companies, which means that the advertising-related job growth they create is buried in the statistics. And, in a recent development, even ad agencies are hiring again: As of July of this year, “Ad agency employment surged to its highest level since 2000, according to the latest Bureau of Labor Statistics figures.”

Now, recent agency growth could be temporary. But it’s beginning to look as though the iconic ad culture is adjusting to the digital age. There’s a film in that too. Probably a lot of them.

See also: Remember those awful Seventies TV ads? The new “attention economy” killed that kind of advertising. But what now?