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Is it Time to Engage a Global Content AOR

Cliff Pia | March 14, 2018

Is it Time to Engage a Global Content AOR

During the Super Bowl, viewers caught an early glimpse of the trailer for The Cloverfield Paradox. Paramount took a time-tested franchise (Cloverfield) and an award-winning producer (J.J. Abrams) and, after a year of trying to make the story work for theaters, ultimately deemed it “unsalvageable”. Paramount is remarkably talented at producing epic films, but that doesn’t necessarily mean it’s just as good at knowing how to distribute them. As a Hail Mary, Netflix stepped in and bought the film for $50MM.

The film business is the content business, and brands are all finding themselves in this content business as well, resorting to casting their advertising agencies as their producers, directors, translators and distributers. But is that really their core expertise? With the need for content exploding and budgets constantly being slashed, the old holding company/agency model has struggled to keep pace with the insatiable demand for creating engaging, effective, and speedy content. Brands have entered an era where the Hail Mary may well be the decision to engage a Global Content AOR. Why?

The Numbers: When you look at any major brand’s total marketing spend, the agency creative usually receives a relatively small amount, followed by the media spend. The majority of the cost goes towards creating the content required to facilitate the messaging, and the majority of this content is created by third party vendors. In other words, the roles that brands ask big agencies to fill end up being effectively a very small portion of what they do best themselves.

Efficiency: Agency holding companies are specialists in advertising, but most are not specialists in efficient and scaled content creation. Consequently, these companies lack expertise in content project management to the magnitude required, as opposed to companies that are actually comprised of content makers and doers.

Account Structure: Many large agencies and brands have added production capabilities in- house, but a very small percentage of their top-tier work is actually produced there. Although most have some second-tier capabilities, few agencies and brands have the ability to manage production company attributes, such as DPs, directors, grips, sound stages, crew, high-end CG graphic capabilities, animation, color correction, music composition and audio sweetening. All of these roles are usually outsourced. The problem is that agencies continue to deploy traditional accounts structured around production, which may suit them, but is no engineered to benefit the client.

Transparency is a challenging subject when discussing the current agency model. This is why agencies are under such scrutiny as to how they add value when so much of what their work is outsourced. The outsourced model of content creation can appear to add unnecessary costs when news emerges of agencies rigging video bids or hiding creative fees in order to create the illusion of lower production costs. Such a lack of transparency can breed a lack of trust, and the ensuing backlash can be seen in the continuing trend of brands investing in their in-house creative capabilities.

Speed to Market: The current AOR agency model was not designed to be nimble enough to react to clients’ instantaneous content requirements, and in many instances, agencies continue to build their methodology around the Big Brand spot and its derivatives. By creating content for all the right derivatives at the outset—and by being smart about capturing multiple stories for multiple platforms at one shoot or one series of animation sequences—speed, scale and efficiency all increase significantly.

Transformation: All brands aim to transform themselves. In order to implement change, CMOs are constantly trying to create content within their budget and limited timeframes, serving the never-ending platform requirements that are out there. They’ve made their money work as efficiently and effectively as possible by utilizing the current model. However, in order to keep pace with today’s content requirements, CMOs need to change how they approach the creation and distribution of content rather than trying to wring as much as possible from an antiquated model.

The large global advertising agencies – and some of the better in-house brand agencies – are impressively skilled at coming up with big ideas and global strategies. They know their brand clients better than anyone, and I’m not suggesting that their role in that function should change. However, it may be worth considering that, in conjunction with those agencies, a new specialized content creation partner—a Global Content AOR—might just be the Hail Mary brands need to win the content creation game.