... We ask advertising executives what this heralds.
Dublin-headquartered consulting giant, Accenture, issued a news release on April 4 saying the establishment entered into an agreement to acquire Droga5. The New York-based creative agency will become part of Accenture Interactive. The deal will see Droga5, which has 500 employees spanning offices in New York and London become a major part of the management consultancy's marketing and customer experience division.
"Though the financial terms weren't disclosed, it's understood that the buy marks Accenture Interactive's biggest acquisition since its founding in 2009," reports The Drum.
Droga5 was founded in 2006 and has a rich clientele which includes the likes of The New York Times, Amazon Prime and Under Armour. It has created one of advertising's most powerful pieces with "Rule Yourself", featuring world-famous swimmer, Michael Phelps and The New York Times' "Truth Is Hard" campaign (2017) to name a few.
It's interesting to note that Forbes reports that headlines that obsess on the 'consultancies versus agencies' narrative are missing the point: Accenture Interactive's acquisition of Droga5 cements a renewed emphasis on creativity in marketing. As per the reports, Accenture and Droga are the latest but not the only example of such new creative combinations. Wunderman Thompson and VMLY&R, Indian IT giant Infosys' purchase of Seattle-based Wongdoody and Stagwell's investment in New York-based MDC Partners also illustrate coupling technology and digital marketing with creativity. It's also known that the Publicis Groupe is exploring the purchase of data and loyalty agency Epsilon.
Food for thought?
Let's explore how ad veterans back home are viewing this. We asked them if they agree with the 'consultancies versus agencies' narrative and here's what they had to say:-
Narayan Devanathan, Group Executive and Strategy Officer, Dentsu Aegis Network, South Asia
Let me share a little known fact: Dentsu's name, in Japanese, translates to "New age communication." Imagine having the foresight to always be about new age communications when the company was first founded in 1901. Now, put that in context with this news-making headline of the coming together of Accenture Interactive and Droga5. It's essentially what they're combining to create or at least hoping to.
The thing is, creativity has never been about the size of the dog in the fight. It has always been about the size of the fight in the dog. To that extent, as the French say - plus ca change, plus c'est la meme chose (the more it changes, the more it stays the same). But if you did choose to make it about the size of the dog in the fight, then that's a formidable dog.
Accenture Interactive's reported quarterly revenue of $8.5Bn would dwarf all other ad holding companies. You could get carried away by that. But, as Bill Bernbach said, creativity is possibly the last unfair legal advantage we might have as businesses. And it's an advantage available to anybody who can wield it well.
Ashish Athawle, Co-Founder and Chief Experience Officer (CEO), Haapus Creative
This definitely heralds a new era and recognises that silos in businesses have to vanish. It will help ideas acquire many more and compelling shapes.
Digital has become omnipresent but is largely seen as a compelling medium to gain business efficiency. This move by Accenture recognises the potential of a complete CX creation. The power of creative-led thought marrying the best of structured thinking and technology is a needle-moving initiative. On similar lines, one had seen Sapient and Publicis coming together earlier.
Amazing new horizons can be explored. However, like any other merger, cultural integration will be key, more so in this case when there is clearly a left-right brain split. Bringing these two polarised views together and creating amazing experiences will be keenly tracked by the industry.
Anil Nair, CEO, VMLY&R India
There is no omen. There is only evolution and natural selection. Companies that adapt and adopt will thrive and others will find themselves losing their seat at the client high table. Agencies were once consultancies that lost their way. It's time to reclaim that position and more.
Agencies need to leverage their core strengths which are primarily their consumer visibility and understanding. The application of that understanding is changing with AI, ML, data engineering etc.
Lubna Khan, Strategy consultant
Accenture's purchase of Droga5 is a wakeup call for the advertising industry - particularly for those who had pacified themselves with the assurance that no matter how much consulting companies encroached on their territory, they did not have the creative firepower to match.
I think it can be tremendously positive for the industry as a whole if we heed the call. Firstly, it reaffirms the importance of creativity in fashioning impactful consumer communication and experiences. For too long, the advertising industry has taken its creative roots for granted. As it collectively transforms itself towards better understanding and use of technology, the primacy of creativity has fallen by the wayside. Disproportionate investments of time, money and effort have happened toward upgrading technology credentials and not enough in nurturing creative cultures.
This industry was built on the back of agency cultures that promoted deep understanding of consumer needs, sociocultural changes and business flows and enabled work to occur in an atmosphere that supported originality and risk-taking. In short, they were hothouses of human creative potential. We need to renew our focus on nurturing and activating that potential.
Secondly, it puts effectiveness and business performance at the forefront. For too long effectiveness has been celebrated at awards, but relegated to the back-burner in the day-to-day co-creation of the brand. Evidence-based thinking, iterative learning and real-time course-correction are things we need to build in as foundations to effectively compete.
This is a call to bring balance back into the industry - the balance of creativity and technology, the intuition and the evidence, the human and the machine.