Media Kitchen

Death of the digital agency: Redux

Last year, I wrote that the digital agency was dead. I was mostly talking about how platform technology was going to knock a lot of digital media agencies out of business. In a world where over five trillion banner impressions are available every month, I argued it was simply too much for humans to navigate through the choices and wring branding effect and performance out of campaigns.

Well, digital media agencies are still around—but they continue to lose share to platforms as the amount of programmatically bought media increases. With RTB-based spending estimated to rise at an annualized rate of nearly 60% a year, according to market intelligence firm IDC, we could see as much as $14 billion in spending by 2016, or 27% of total display spending. Looks like the machines are slowly taking over.

Ad agencies aren’t going away. But some of their services may be.

It was all about data at the Digiday conference in New York today. Marketers had converged to discuss the future of advertising agencies, behavioral targeting, and ad networks, and were probably relieved to hear reiterations that their collective demise had been overstated.

All three topics are constantly on the precipice of being verbally written off. There’s talk of Google and ad networks killing off ad agencies, privacy concerns killing the practice of behavioral targeting, and ad networks cutting off air to one other.