Jin S. Lee/Business Insider
- Deloitte Digital's Andy Main argues that many advertiser needs are no longer met by legacy agency tactics.
- Business Insider recently caught up with Main, Deloitte Digital's global head.
- Main said agencies are at a disadvantage because they lack direct access to clients' c-suite and just transact in media.
- Consulting companies have an edge because they can speak to all the areas that transform clients' business, he said.
Consultancies including Accenture Interactive and IBM iX often claim that they can meet the needs of CEOs and CMOs far better than traditional agencies can.
Deloitte Digital is no different. The
"They [ad agencies] should be worried because the heritage of the agencies has been largely in the media business, and people nowadays are looking for more value than just transacting media," said Andy Main, head of Deloitte Digital.
Business Insider caught up with Main last month for a chat. Here's an edited version of our conversation.
Tanya Dua: Agencies are increasingly wary of Deloitte Digital, Accenture and IBM iX. Should they be?
Andy Main: I would think so. The heritage of the agencies has been largely in the media business, and people nowadays are looking for more value than just transacting media. It's more about experience, technology, innovation and design coming together, which does require media, but media is not the central talking point.
Dua: Consultancies say their relationships go all the way to the c-suite, in the board room. Is that another advantage that agencies lack?
Main: Agencies have largely been built to talk to marketing. And it's really hard to change a business for the better only by talking to marketing. When was the last time an ad transformed a business? Probably never. You need to be more relevant to the future ambitions of businesses, which means you're going to talk to the c-suite.
Dua: Accenture recently set up a programmatic arm. Will Deloitte Digital go down that route?
Main: Programmatic is not the best use of marketing money. I may be lynched by the whole programmatic industry for saying that, but programmatic advertising is not exactly super targeted, because it's largely cookie-based retargeting based upon something that you might have already bought. Rather, you want to use data about your customer using AI and cognitive pattern recognition, to target people individually, with things you know they might need in their lives. I kind of equate programmatic to goldfish. It's not a precise communication. We've built a platform that enables that precision in communication.
Dua: Can you give an example?
Main: I'm not at liberty to give names. In retail, for consumer goods clients, we help in capturing first-party customer data and analyzing that in real-time to say something relevant to the customer at the point of touch and engagement they wish for - be it in digital or a store, a referral or recommendation.
That covers the entire customer experience journey, because while the marketing industry's been more geared toward making me aware of something, it's not actually helping me use it or get value from my usage. Most of a person's experience with a brand is after they buy it. And we're helping brands capture and monetize these points of touch in addition to marketing.
Dua: Sir Martin Sorrell's S4 is similar to Deloitte Digital and Accenture in that it has a single P&L right?
Main: We take it as a great compliment. I think the jury's out, because S4 is clearly a brand-new entity. I wish it well and hope it's massively successful, but it doesn't have the embedded client base or relationships in the marketplace. So it's got a big fight in its hands to establish its position as a brand new business.
Dua: What about the holding companies - will all the mergers and consolidation help them survive?
Main: If you look at the growth and the shareholder value return from the holding companies compared to non-holding companies, you see a huge gap. Recently, there have been improvements, but you've got to ask if everyone else is growing double digits, ourselves included. What's happening to the holding companies that prohibits their growth? It's all the same market, and it all comes back to the focus on media.
Dua: Talk about how Heat functions within Deloitte Digital. Does it get pulled into these c-suite meetings?
Main: Heat obviously helps with typical marketing, original creative and messaging to the marketplace. But Deloitte Digital has also moved into the digital transformation business. Heat is extremely helpful in putting the story together about what the future of that business would be. But you can only do that if you've got the strategy, technology and design bits also figured out. Our business has all these bits glued together.
Dua: What are some of the challenges you face? Is talent one of them?
Main: We've seen a massive intake of talent from the typical holding company properties. Marketing is not the only outlet for creativity. We give people the ability to have creative expression across a business. The challenge is actually keeping up with the growth. Deloitte Digital has been around since 2012, and our share has been 30% CAGR year over year.
Our ambition is to bring digital to all aspects of a business and not just creativity, experience and marketing, but AI, blockchain, biometrics, even things like space technology, which is also starting to come into our sphere of work. That's what our clients want to hear about to keep themselves at a continuous advantage.
Dua: How do you respond to the criticism that consultancies don't actually produce any tangible work?
Main: I'm in the business of transforming businesses, and that involves a higher-level relationship that pulls through the marketing and advertising work. So it's a view of the market that I see that they don't.