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Highlights from the 2008 Digital Conference 

“If I were starting my agency (CKS) today, what would I do?”
Mark Kvamme, Venture Capitalist, Sequoia Capital

Mark’s firm finances new technology. Among the companies he’s funded are Google and YouTube; however, they passed on Facebook. Most of the people they are currently funding are in their early-mid 20s.

Points from Mark’s presentation:

  • This is the “attention generation.” We need to engage them and get them involved. Brands should be creating content that is useful to the consumer and then integrating that content with the brand. He’s interested in investing in companies that are currently doing that.
  • Mark showed us www.searchme.com, a new search engine that has completely changed the user interface. He mentioned that it’s still in the alpha software stage, but it looked like something that could be a great tool for grouping search results in a very unique way.


Digital Agency Business Models

Nancy Hill moderated this panel of Matt Anthony, CEO of VML; Joe Celia, CEO, G2; and Winston Binch, VP Interactive Production at CPB.

Nancy pointed out that the panel consisted of very different models, proving that there is no single model or path to becoming successful. Each panelist began by explaining how his agency developed its digital practice.

VML started as a traditional agency and began working on some websites for a number of clients, such as Sprint, in 1994. When the client asked them to build their site, they decided to bring technology in rather than outsource it. They saw an opportunity to create a niche and by 1998, 70% of their work was digital.

Winston explained that CPB maintained a nontraditional approach and was always attracted to campaigns that were interactive. In the last five years they became rooted in interactive/digital because they knew they could do more for brands. Whereas they used to outsource 90% of their production, they now do 50% in-house. They realized they could do it better themselves and built a leadership team with elements that an interactive agency would have. Winston stressed the importance of technologists being a part of the creative team rather than being their own group.

Joe’s agency model differs as it is a multinational group with many sub-disciplines. They built and grew their interactive capabilities through acquisitions.

Nancy asked the panel how compensation has changed from traditional agency models to reflect interactive services being offered.

Winston said they present a range of ideas to the client that are portable across media, including interactive. They charge for their oversight of the idea and keep the production part of the bill separate, as they would in the broadcast model. Matt said VML has a flexible attitude on how to bill clients and he believes that digital is now taken just as seriously as traditional media and should be compensated the same way.


Stop Screwing Up Our Experience

This was a panel of college-age kids moderated by Ed Cotton, Strategy Director, Butler, Shine, Stern & Partners. He began by asking them to introduce themselves and briefly discuss the role of technology in their lives. They went through their daily online activities. A number of them had their own blogs or had created a social networking site. They all were active on MySpace and Facebook. When it came time to talk about brands they liked, they all sang the praises of Apple. As a group, they have no patience for ads, unless the ads “benefit them” in some way. However, they admitted that, given the choice to eliminate ads on a site like Facebook and pay a monthly fee of $10, they would never pay for the service.


The Future Is Now
Jeffrey Cole, Director, Center for the Digital Future, USC Annenberg School.

Jeffrey believes that “media will survive, but as smaller businesses.” He illustrated this point with some historical examples. Radio, movies, and music all still exist but their profitability is nowhere near what it used to be. Newspapers will flourish, but in new incarnations. Online and digital formats will allow for breaking news. TV will grow, but be viewed out of home. The question is how costs will be covered without the traditional ad base.


Mobility: What’s Working and What’s Not

Panelist Eric Bader, Managing Partner, Brand in Hand, Inc. explained that in addition to branding and awareness building campaigns, mobile can be a great direct channel. He maintains that some other direct channels such as email and direct mail are underperforming and that using that money for mobile can get better response and ROI. Mobile is starting to attract real money because it is performing.

Some other points made by the panelists:

  • a mobile campaign can cost between $100,000 and the low millions
  • mobile phones are the only devices that people walk into point of sale with
  • mobile is an engagement medium more than a reach medium and complements other media with tighter targeting.
  • the issue of targeting vs. privacy is very real and will need to be addressed.

Is Data a Friend or Enemy?
Geoff Ramsey, CEO, Co-Founder of eMarketer, Moderator

Data can be manipulated to show different answers to the same question. The analytics department in an agency usually stands alone, but it might be advisable to integrate it within the agency. Geoff suggested the possibility of an Analytics “agency of record” in the future.

Prepared by Rebecca Samson and Carol David of AAAA Research Services

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