Why Ad Agencies May End Up Like Petrol Stations

When I was a kid there were loads of petrol stations (there was even one in my road), and for the most part they just sold petrol. The motorway ones sold car maintenance crap and those nice powdered-sugar travel sweets, but the city ones were places you really only went to for fuel.

Then they started to sell other things. Magazines, groceries, coffee, mobile phone top-ups, cigarettes, flowers, charcoal briquettes (nice new print ad for VW, by the way) and even booze, just in case you felt just a little too sober as you took the wheel.

They became so good at doing this that they began to make more money off the non-petrol things than the petrol. Then they started to close, after all the property market was going through the roof and those forecourts took up an awful lot of space.

And now there aren’t many left (the one in the road I grew up in disappeared years ago).

So, with that in mind, here’s another ill-thought out theory to go with the many other ones that have appeared on this blog:

Many advertising agencies are becoming like petrol stations because they are becoming less about the business of creating ads as we know them, and more about selling their clients extra services.

If you think about it, this has become a financial necessity, even if your only ambition as an agency is to stand still. The amount of cash your clients are offering for a bit of press, poster, TV and radio advertising has declined dramatically, partly because the media costs for conventional media have plummeted, and partly because costs have been transferred to other forms of advertising, many of which were not created by conventional agencies only a decade ago.

So now agencies are claiming or acquiring skills that are new to them. These skills may be closely related to ‘conventional advertising’, but they are still not enough. An UK ad agency that wants to take in tons of money in 2009 needs to provide other services, almost all of which are process services: researches, audits, projections, strategies, analyses, competitive reviews…Anything that can be generated from the usual personnel of an agency.

Or, to be more specific, the usual non-creative personnel of an agency.

Indeed, this torrent of blah does not require much input from the All-Star-wearing picky little sausages in the Creative Dept. Sure, we might be called upon to provide adcepts, or pointless fucking cannon fodder, but the new streams of income emanate from the planners and the suits.

And this might just be why, in many agencies, creativity is taking an increasingly distant back seat to the other disciplines: it’s less lucrative.

Of course, it still pays to some degree, but that degree is decreasing, and with it, the significance of the Creative Department, and the creativity of advertising in general.

So, back to the petrol station. If agencies are going to marginalise that which is their ostensible function, they will become fewer and further between. Perhaps they will disappear and become something with a new name, such as communication consultancies, leaving the places that actually produce creative work to become smaller, more specialised communication production agencies, that merge with production companies and photographic collectives to do nothing but make the finished product. I imagine that what we now know as an advertising agency will exist, but only in larger incarnations that serve to make the more pant-wetting of our clients feel a bit safer and believe they are saving money through economies of scale.

The nth degree argument of this is that WPP will go back to producing Wire and Plastic Products, perhaps as an additional service for clients that need such a thing.

And the separation of ad agency departments which have always, despite claims to the contrary, been riven by dislike, jealousy, condescension, petty squabbling and diametrically opposed perspectives on life in general, will become formalised, leading to generally increased happiness all round.

It’s enough to make you feel all warm inside.