#BigQ2020: The future is here •

by MarkLives (@marklives) What are the industry expectations for the marketing and advertising industry in 2020? A panel of key agency and marketing execs discusses the macro environment, budgets, changes in messaging, movement in the industry and any consumer and communication trends they’ll be looking out for in the year ahead. Next up is VMLY&R‘s Jarred Cinman.

Jarred Cinman

Jarred Cinman (@jarredcinman) is the CEO of VMLY&R South Africa, part of the global VMLY&R network. He founded one of the first professional web services firms in 1995. After selling his first business to the VWV Group, he became part of the founding team of VWV Interactive, which went on to dominate the web development industry during the late 1990s. In 2010, Jarred was part of the team that merged Cambrient into NATIVE, which became NATIVE VML in 2013 and VMLY&R in 2018. Jarred was IAB South Africa chair for three years, sits on the Loeries committee, is a board member of the ACA and DALRO and, in his spare time, answers his email.

2020 has such a nice ring to it, doesn’t it? The kind of thing sci-fi movies as recently as the ’90s might have included to evoke the idea of a distant, utopian future.

As the real 2020 begins, it’s more dystopia that we fear — a year of tumult, turmoil and tension. Britain will Brexit. Trump will fight to appease his bottomless ego. And here at home we’ll confront a combination of economic woes and political animosity that impacts all of us. All of this is happening within a context of global threats, the most serious of which is climate change/crisis, combined with a not coincidental rise of the far right that simply denies it’s happening.

This column is called “Big Q” — the Big Question — so I’m starting with the biggest ones. What does this mean for the advertising industry in South Africa? Like all good trend-watching articles, I will pare it down to three big things to watch out for. Like all good trend watchers, I’m hereby disavowing anything I’ve called wrong in the past.

#BigQ2019: Is advertising screwed? — Jarred Cinman
Big Q 2017: Jarred Cinman’s expectations for the SA ad industry

Trend 1: Industry disruption

There’s a fun one to kick off with. It doesn’t take a brain surgeon/rocket scientist to work out that the South African economy is under immense pressure. Advertising is largely concentrated on consumer-facing brands and so, when consumers spend less, that hits the industry’s biggest clients where it hurts.

There are times when this may lead to more ad spending as competition increases but, unfortunately, many clients don’t trust their agencies as much as they used to. Thus, marketing is being given budget cuts combined with increased targets/expectations and asked to “prove your value”.

Trend 1 summary: Less marketing spend, more focus on returns, impatience with “creativity”
Look out for: Lots of account moves, agencies struggling to make profits, agencies which know how to drive results moving ahead of the traditional shops

Trend 2: New market entrants

A lot of these new entrants are no longer that new but they are yet to capture a major chunk of business. Watch this space.

There are two primary disrupters here: the consultancies and black-owned independents:

We pitched against Accenture and Deloitte recently for the first time on social media work. They were very aggressive on pricing and, as I understand it, made a compelling case for data and marketing technology. They didn’t win. But, for us anyway, this was a strong indicator that they’re shifting into top gear to win in this space. Globally, Accenture Interactive won Kimberly-Clark’s baby care business in the US in November 2019— its first big win after paying hundreds of millions for Droga5. Call this a Droga5 win or an Accenture win but the story worked.

There are constant rumours about a big consultancy buying one of the large independent agencies in SA. At some point, one way or the other, these people will take their place on the agency ranking tables.

Several black-owned agencies have also made good progress last year — notably Avatar (which most recently picked up some big Unilever brands, and opened in Durban), The Odd Number and Riverbed. Even if they haven’t won a major market share yet, they’re being included more often on the big pitch lists, so it’s only a matter of time. What’s unique about these agencies is that they’re structurally immune from being swallowed up by a big group. Their ownership itself is a USP, and so they effectively must remain in local hands.

In addition, 2019 was also the year of big ownership changes to deliver on MAC charter targets. A number of WPP agencies are now 51% or more in black hands. My understanding is that other networks (such as Interpublic in Africa, which recently renamed FCB Africa to Nahana Communications Group) also tackled ownership last year.

Trend 2 summary: Many more choices for clients when choosing agency partners, ramping up competition
Look out for: Big local account wins for consultancies and black-owned agencies; global networks further simplifying and clarifying their offering; more agency mergers/downscaling (and closures)

Trend 3: The next wave of digital

This year will be 25 years since I founded my first “internet” business. At the time, the internet was imminently about to transform society: we would buy everything online; we would communicate only digitally; and we would all wear weird goggles that would port us into a virtual 3D world.

Well, 25 years later and a lot of this has come true. But it took its time getting there, especially here where artificially inflated connectivity costs held us back for at least a decade (and still do, to some extent). But it’s fair to say that, if you include WhatsApp and B2B applications, the internet is now pervasive in our society. The weird goggles remain largely a disappointment. But, as will remain true forever now (unless we destroy the biosphere), technological change has only started to make an impact.

The extent to which marketing will be automated, generated and smartened is barely understood by the average marketer or agency bigwig (including me). Everyone pays lip service to concepts like programmatic media, algorithmic creative and data — that overtraded word deployed to win admiration everywhere.

There’s no specific tech that arrives in 2020 but many that are reaching maturity and becoming best practise. In particular, anything that may be automated is being; and machines can do things exponentially faster and more reliably than humans. We know that targeting and ad serving is already driven by algorithms and data (at times creepily so) but content is the next pin to fall.

Expect to see more impressive generated creative that adapts while it runs. I’m not someone who believes this marks the “death of creative” but rather the birth of organic creative. Like any organism, this type of creative will have a kind of DNA that replaces the “big idea” and will evolve from there. It’s a really exciting prospect — and also one that traditionally-minded creative people will hate.

Trend 3 summary: Traditional methods of marketing and their digital replacements will drift further and further apart; what we call “advertising” will be unrecognisable compared with today
Look out for: Iconic local campaign success with technology at its core, and creativity as its partner — and the desperate scramble as everyone else tries to catch up.

Jarred Cinman

Trend 1: Industry disruption

Trend 2: New market entrants

Trend 3: The next wave of digital

See also