Tuesday, March 31, 2009

Advertising will survive. Not so sure about agencies though.

I was having a chat with a couple of tennis dads on Saturday. One of them, John Bird, is an experienced Ad industry guy. He summed up the position of ad agencies (as distinct from the ad industry as a whole) quite well I thought.
“20 years ago an ad agency made 17% on a client’s media billings. Today they make an average of 3%.”
Or put another way, ad agencies are making a fifth of what they used to, for doing the same work. This can’t last!
The structure of the industry will have to change. It’s only a matter of time.

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