Disintermediate! Disintermediate! How Startups Might Exterminate Agencies

Disintermediate! Disintermediate! How Startups Might Exterminate Agencies image disintermediation13Disintermediate! Disintermediate!

Two fascinating articles from Giselle Abramovich recently on Digiday, the self-styled “Authority on Digital Media, Marketing and Advertising” (it really is, mind you – it’s excellent). The first highlights how brands are cosying up to startups, directly approaching innovators to develop and float new ideas and platforms. Of course, that used to be the role of agencies, who would then sub-lease these fresh new goodies to their clients.

So it’s no surprise that a recent follow-up article lists Five Ways Brands Are Cutting Out Agencies - a pretty terrifying read if you happen to work ‘a-side’. Once again, it refers to this disintermediation of agencies – the way that brands are increasingly cutting out the middleman by sourcing and managing all the tools and resources they need to achieve success.

It goes without saying that the immense democratisation of recent technology plays a huge part in this. Where, once upon a time, you needed an agency to secure you the best rates for display ads, these days it’s all done by machines with very little leeway for the creative flair agencies once brought to the table. As for social… well, which would you choose to nurture the bond between your brand and its customers? The people who live and breathe your brand every day, or a hired gun who’s probably also working on any number of other accounts, and arguably knows your brand les well than the customers they’re paid to engage?

So is it really all doom and gloom for agencies? I love spiky stances  (lord knows, I’m responsible for enough of them myself), but Digiday has probably gone a little too heavy on the bleak-sauce this time around. Working at one of the startups they’re referring to, I’m happy to go on the record as saying I love it when we work with agencies. To date, our most successful campaigns – and our most adventurous clients – have come about via agency introductions. We’ve worked with the likes of Sony, Pepsi, Pfizer and more – running Social Commerce campaigns for household name brands and products, and all because there are some wonderful, imaginative people at agencies who’ve developed relationships over the years which, as a new company, we couldn’t possibly hope to emulate for a long time to come.

In our own sphere, social, there’s no question that Social Commerce – the next era of social, where passive audiences are converted into active shoppers – is rapidly eclipsing the touchy-feely world of Social Media Marketing. As CFOs and CMOs demand visible ROI from their social investment, this is a shape up or ship out moment for agencies. You know how sharks die if they stay still? So do the little Nemos they guzzle down for breakfast – and the new social paradigm will make Nemos of us all if we’re not careful.

But, far from competing with agencies or circumventing them, companies like mine are perfectly positioned to empower them. We can help agencies to strengthen their proposition, so they can a) better their offering to existing clients and b) leverage our innovation to acquire new clients. Their credibility, experience and ability to deliver at scale; our innovation, expertise and energy – together, we can combine all these strengths to delight the client.

But that won’t always be the case. Every time an agency fails to embrace evolutions like Social Commerce, ostrich-ing its head in the sand and hoping that things will stay the same, they’re forcing the startups to go direct to brands or the brands to come direct to us. In time, we’ll develop the relationships, we’ll grow the credibility, we’ll accumulate the experience, and we’ll have worked out how to scale what we do. And then we really won’t need agencies anymore. And neither will the brands.

For the good of us all, let’s make sure that doesn’t happen.

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