I was asked by Campaign Brief magazine to write an article for the Feb / March addition to discuss the changes all agencies are experiencing because of the growth of digital . Below is the story that was published.

Last year in the advertising industry, we saw more change in twelve months than we had in the previous five years. The frightening financial environment played its part certainly, but it was the media fragmentation caused by social networks and the increasing importance of the conversation economy that caused a tipping point in ad-land.

Interactive thinking was in hot demand in 2009 and the push was to create ideas that had value exchange and encouraged customer participation. This meant agency Creative Directors and Managing Directors started to review their creative output and their agency approach to meet the new marketing demands of clients.

Everything was up for discussion within agencies. What talent they needed, what approach suited this new environment best and what structure would allow them to meet these new challenges in a sustainable and profitable way.

My advice to you is simple: embrace it because we’re only at the beginning of what will be a period of dramatic change in the agency offer. The next 10 years promise to be the most exciting, hectic and challenging in our industry’s history and a shake-up of epic proportions is ahead of us.

I’m certainly not going to debate which is better: a pure play digital agency structure or digital silos within a traditional advertising agency group. It’s been my opinion for some time that digital will drive every agency approach and this will ultimately mean every agency will end up in the same place over this decade. No-one owns digital any longer. The best online work last year consistently came from traditional agencies. Digital specialists, the writing is on the wall. Stay as digital specialists and you will soon become little more than a production house. What I do believe is that pure play digital and more traditional agency models do give us a path to where we are heading as a creative industry.

I see agency leaders this year needing, or if they don’t already have then acquiring, an interactive mindset. This means grasping that the Internet is NOT just another way to engage people. It is the central hub in which communication will happen this decade and it is TV, radio, print, experiential and every other channel that will be the spokes of that hub. Without this Interactive mindset, today’s agency leaders will not, and cannot, make the right decisions in 2010 on how best to shift and evolve.

It’s never been more important to get your structure, your talent and most importantly your services and solutions in alignment so you can create and manage brands for clients in this volatile media landscape.

Today most agencies have the typical functions in place, i.e. Account Management, Creative, Planning and Production. If an agency has their interactive digital departments sitting as a silo discipline, or worse a separate agency, then they have a long road ahead.

Digital professionals should be integrated throughout an agency into key leadership positions. Advertising is no longer just about the display ad or the TV commercial or the banner; it’s about creating meaningful tools and architecting user experiences. This means digital professionals being full partners in the campaign development process and contributing to the Big Idea with clients. They can’t be an executional afterthought, buried in the basement. Digital professionals must be integrated across all agency disciplines and functions. Digital skills such as data, measurement and customer experience planning must also be raised into the briefing stage of client’s business problems.

If you put your Interactive mindset at the centre of everything in the agency it means your thinking goes from just producing one big idea and expressing in a one-message-fits-all fashion across all channels, to actually developing interactive participation ideas which are interlinked coherently by useful applications and customer tools, which do not necessarily start and end in the same place, i.e. a move from campaign thinking to programme solution thinking.

While production departments have seen great change, the entire agency needs to live and breathe digital innovation, not just see digital as a production requirement. Successful marketing programmes are now being conceived in both the online and real world to take our client’s customers on a journey of brand touch points. It means with more digital channels, the agency communication programme has become real-time and data driven. Ultimately, this means it can be tracked and is accountable. It also means the ideas and strategies you create for clients are getting much closer to something that is useful to customers and part of a consumer’s daily routine and habit, rather than just producing a series of advertising messages.

If you have a true interactive mindset in place in 2010, it is in the creative department where you will see the biggest changes, especially in how they are structured. In most advertising agencies today, the art director and copywriter team rule, but in a pure play digital agency world that is very different. Here strategy and planning, information architecture, user experience and technology are the kings. Most agency managers see how amorphous advertising is becoming but are in thrall to large numbers of people they employ with specific craft skills. Outsourcing and crowd sourcing are on the increase. Getting the right agency creative structure with all the varied skills and disciplines working together will be the real focus of Creative Directors this decade. They will act more like conductors managing the groupthink and always pushing for big business solution ideas for clients that are memorable and measurable.

The agency production department is the one area that has changed the most in the past two years. Production people now have to create films for TV, web and mobile; develop console games plus video- and game-driven micro sites; and let’s not forget the need for merchandise and e-commerce capabilities.

Agencies now have to know how to create and roll out Facebook applications, iPhone and mobile applications and all sorts of varied interactive animation content. Production teams have to link offline experiential events, festivals, art installations, interactive billboards, QR-code-based posters and print ads so that they drive people to online digital engagement environments that move the customer closer to a product and sale.

It has become very clear to me that an agency cannot just push digital production out of the building. For creative people to conceive unique and challenging interactive ideas and material, they need to be able to talk freely with technologists. The less barriers (real and imagined) means better client solutions.

Agencies need to find a passion for digital production and get involved in the nitty-gritty. The secret to this is having a creative leader who has a heart-felt commitment to the interactive mindset and is prepared to live it, not just talk it.

The new agency creative models that will evolve this decade will be grounded on a strong understanding of brand marketing functions, as well as operational dynamics that can affect a company’s ability to reach audiences and drive sales.

I see the true evolving agencies in 2010 being focused on translating client and boardroom business needs into multi-disciplinary marketing outputs that operate in bought, owned and earned media platforms. All three of these media channels are data-driven and this means we need to have more focus on accountability right at the early stages of developing ideas.

Isn’t it results that company board of directors talk about? Shouldn’t we bring them solutions that let them see customer interaction with their brands?

The digital revolution that started last decade is helping create an opportunity for agencies to move up the food chain with business leaders. There has never been a better time for brand owners and creative agencies to work together to create an interactive mindset that will lead to ideas, services and products that are not only focused on both board room objectives but also on a style of brand communication that is truly useful to consumers, more engaging and relevant to their day-to-day life. It’s always hard to figure out the balance between where interactive is now and the major shift to digital that all agencies are on and must take. But rest assured it’s upon us so in 2010 raise your digital leaders into key leadership, management and culture roles to stimulate those interactive minds and you will see agency change happen very quickly and enjoy the results it will bring.