Foursquare, premium advertising, and agencies
With the publishing of Brian’s article, it is probably a good time to announce to you all that I am lucky enough and thrilled to be part of Foursquare’s recent series B round as an angel investor.
I’ve been friends with the Foursquare gang (and Harry especially) for a long time, and I am super excited and proud of what those guys accomplish as they near their 2 millionth user. I’m geekily proud to say my user number is somewhere in the mid 2 digits*, and generally dismissive of those who willfully fail to see Foursquare’s potential. The most common refrain seems to be “I don’t like it for me,” or “no one will ever use this,” which bely an extraordinary lack of curiosity on the critics part: I don’t particularly love football, for example, but I am endlessly fascinated with how popular it is, and am constantly curious as to why. Thirty million Elvis fans and whatnot. Two million people signing up for anything in such a short time is a fairly impressive feat, and when you look at the growth rate, it’s doubly impressive. Whether you use it or not, someone is, and if you consider yourself at all a connoisseur of digital trends, it’d probably be worthwhile to find out why.
ANYHOO, my angel investment should probably be disclosed as I comment on Brian Morrissey’s rather excellent recent article on agency’s endeavors in trying to work with Foursquare. This disclosure perhaps taints my experience (though it’s only a couple weeks old), but I can say that Foursquare has been very responsive to our agency’s inquiries, both on behalf of clients, and for our own hobbyist pursuits.
I can also say, however, that I’ve seen eye-to-eye with Dens et al about the merits and potential of the API for a long time, and we’ve generally been exploring marketing solutions that use the API rather than trying to get Foursquare to give one of our clients a badge. We get what they are offering, what they are going for, and we try to align that with our clients’ needs.
I do think, though, this article points to a larger trend I have been yammering away about for a couple of years now. Indeed, I did a fairly comprehensive presentation about this not so long ago at The Economist, and I think it’s a good time to revisit it.
Basically, history and circumstances have driven us to a place where engagement and unique, custom offerings are all the rage. And yet, the media agencies still control the dollars. SO: who thinks up and executes some awesome new marketing implementation on the Foursquare API? The media agency is bereft of any smart creatives and technologists who can think up and develop these, yet they are the ones trying to “do the deals” with Foursquare. It is undoubtedly many of these that Brian was referring to when he said “One agency representing a major package-goods client said the company put the onus on the brand and agency to find the best way to use the service.” Well why not? An agency thinking up ideas? Quelle horreur! I’d ask that agency if they have delved into the API message boards, but i have a sneaking suspicion that agency would not know what that question meant.
Creative agencies get this and are brimming with ideas, but generally don’t control the purse strings. Budgets are set at a higher level. Media plans need to be filled, yadda yadda.
Foursquare’s an awesome place to work for just about everyone but… a marketing creative. You’re a crack art director. Do you want to work at Crispin, or at Foursquare thinking up alternatives to badges? You could do that and a million other things at a sweet agency. And try getting developers at a major new hip startup to take time off of working on the product, or scalability, or the real meaty issues that drew them to the company to begin with in order to work on a snickers campaign implementation.
In short, none of the traditional agency models or other parties in the mix is the right entity to think up, negotiate and execute custom & premium ad deals with publishers. And these are the deals that everyone wants.
I believe there is a real opening here that can point the way for the creative agency in a world of earned media and premium marketing opportunities. And, as I’ve been saying for years at various conferences, I believe the chickens are coming home to roost from the great media-creative schism of yesteryear. Earned media will kill it off. Media’s gotta come back in-house. It’s not a question of if anymore, but when.
Finally, I think it’s still up in the air which side of the equation - the publisher or the agency - will be on the hook to “think this stuff up.” It is a lazy (and most probably a media) agency that expects the publisher to do it for them. But that process may well prevail. Media agencies are powerful, and clearly they’d prefer the publishers to think this shit up for them since, well, they jettisoned their creatives 30 years ago. And perhaps then, over time, digital creative agencies will become the vendors not to the brands but to the publishers, and help them provide these ideas. Indeed, I don’t think it’s a coincidence that our client bas now includes so many publishers (The Economist, Viacom, Digg, CNN, etc). And I’ve certainly had no shortage of conversations with publishers confirming the merits of this line of thinking.
It certainly seems plausible, and increasingly so as the years go by. The economics aren’t quite aligning yet - publishers are definitely in desperate need of these services and are willing to pay, but they aren’t willing to pay “brand” rates yet. Furthermore, a sales-commission model seems to be preferred: you give us ideas, and if we win you win. This might work, it might not. But hey - the entire economics of advertising are washing out right now anyhow. No reason to think this particular paradigm won’t be the one that rises to the top.
Conversely, rather than the publishers becoming the clients, It’s also plausible that a slight modification on the “agency of the future” model that R/GA pushes could work - provided media is folded back in, and technology isn’t off-shored, and they can keep the best developers and stay abreast of the technology trends (rather than having those developers go work at, well, Foursquare). That could work, yes. And yet, it’s interesting. R/GA has an amazing video about how the agency world got to where it is now, and how they are a new model for it. It’s very compelling. would posit however that it leaves out a critical, and increasingly important component: the publisher.
This isn’t the old days. We don’t make one thing for multiple publishers anymore. Every publisher has their own API, their own best practices to engage with the customer. While we’ve traditionally had a advertiser-publisher firewall in the US, it is not so far-fetched to see this crumbling. It’s been gone in some countries (think Japan/Dentsu) for ages, and Google has been chipping away at it in the US for a long while.
In any case, Brian’s article is a breath of fresh air for me, and illustrates where we’ve been going with all this work for publishers, I think. If I may be so bold, I’d recommend a quick review of my old talk at The Economist for a good historical overview of how we got here and where things are going - I’ve-posted it here.
And now back to your regularly-scheduled snark and 80’s nostalgia act reunion updates.
*this is a slight simplification. If any of you are Trainspotting enough to discover my user number and see a discrepancy, feel free to ping me for a robust explanation.