The old models of making money at production companies and advertising agencies are falling by the wayside. Budgets are crashing through the floor, and they’re not coming back. Hate to be the bearer of bad news, but the clients won. And this is their reward:
Dysfunctional in-house creative and production teams
A thinner roster of competent and dependable partners
Over-promising and under-delivering by new partners
Every corner cut at critical points in the process
Smaller budgets to stretch
But never underestimate the corporate world’s appetite for mediocrity. Most of the time they don’t want or need high quality. They need dumpsters full of “just good enough.” Everyone else in the process is motivated to doll up the best work possible, because that’s what leads to the next client. Folks are hired on the quality of their reel. But as we continue to devalue everyone and everything that moves in our industry, where does it end? The latest rumblings are terrifying.
It’s Gonna Be Great for Your Reel
Agencies are asking production companies to create Super Bowl ads for free. You can hear the pitch already: You’ll get plenty of new clients if you make this spot for us. But how long before clients catch on and start asking the agencies to do Super Bowl advertising for free? Spoiler Alert: We’re headed for a very dark place.
The mid-level budgets got hollowed out over a decade ago, and now we’re trimming the top of the tree. I recently spoke with Paul Green, producer at Anonymous Content in Los Angeles. He described commercial production as a very, very difficult business to be in right now. I couldn’t agree more. A lot of highly skilled people (and companies) are leaving the business. That’s another stink bomb clients will inherit.
The War Between Old Allies
As production companies add strategy and other agency-like services, clients are starting to divert work directly to them. Meanwhile, agencies have been building out in-house production capabilities for years, cutting out the production companies. And business consultants are doing both, cutting everyone out. I haven’t even mentioned digital teams siphoning off a larger share of marketing budgets every year. Next stop, the final scene of Othello – a complete blood bath.
The New Paradigm of Persuasion
As this industry morphs into something different, simple truths are clear:
The Treacherous Path Forward
We aren’t in the commercial-making business. We’re in the behavior-changing business. The clients won. Our first step is to change our own behavior.
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Mike Johnston is a production executive and advertising creative in Seattle. He is available for freelance consulting, writing and directing. Contact Mike
Wanna know why traditional production companies will not survive? Read all about it.