In the predigital days, advertising agencies were ruled by swaggering creative directors who gorged on lavish client contracts and sometimes created campaigns that set the cultural agenda and captivated the public.
Nearly every piece of that equation has changed. Agencies are better informed than ever before about consumers, having amassed huge stores of their data. But many of those consumers, especially the affluent young people prized by advertisers, hate ads so much that they are paying to avoid them.
At the same time, companies that hire ad agencies are demanding more from marketing campaigns — while paying less for them.
As a result, the advertising industry faces an “existential need for change,” according to a blunt report published on Monday by the research firm Forrester. Now the agencies must “disassemble what remains of their outmoded model” or risk “falling further into irrelevance,” the report concludes.
“It’s harder to reach audiences,