April 3, 2016

Will Canadian Ad Agencies be Uber’d*?

*Definition:  to be ‘Uber’d’ is to be essentially replaced or at the very least, be threatened by a technological change.  What’s interesting about being Uber’d is that municipalities all across Canada (and other countries) face the same threat from one challenger, forcing them to all act on their own, with few sharing lessons learned efficiently or effectively.  The result is that the challenger easily wins because they continuously feed learning and experience towards their single objective. Companies like Wal-Mart and Costco operate the same way, but fear and loathing of Uber seems to be disproportionate to these other companies.  I don’t know why.

One of the many careers I had in my lifetime was working for several ad agencies as a digital media buyer.

This was during the late 90s and early millennium when saying as much would have everyone else in the office look at you like a leper.

Budgets were hard to come by, so other folks who were trying to convince the world of media buyers and marketers that digital was the future were actually competitors, not supporters.  It was a sucky time to be in that business and it left a permanent scar on my love of the agency world.

Which is why news about a Canadian media company that will allow US advertising agencies to place buys in Canada comes with mixed emotions for me.

For decades, the Canadian ad agency market has been protected by unnatural economic barriers to efficiency like split runs (where magazines have to publish two different versions to accommodate Canadian ads bought, organized and managed by Canadian agencies for Canadian companies) and CRTC-mandated Canadian control of networks to ensure that a handful of companies would also have control over the placement, negotiation and placement of ads across our country.

It came to a point in time where Canada was so consolidated just a few years ago compared to a highly fragmented US market that Canadian networks and media companies had (and may still have) significant pull with Hollywood, US TV networks and other creators of content.

Now that systems are in place to allow American companies to begin the process of bypassing Canadian buyers, expect big changes to start happening in our marketplace.

In the digital world, performance-based platforms like Facebook and Google make it easy to bypass any Canadian marketers and agencies, all-the-while targeting Canadian users.

Now, I’m not saying that Canadian ad agencies will be Uber’d* any time soon, but the risk is there and those still working in the business shouldn’t be too surprised if the rug gets pulled out from under their feet before they’re ready.

 

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