Debate over the potential implementation of the so-called “Amazon tax” has thrown light not just on the poor health of physical retail, but on other distinct and major trends driven by the pandemic, as well as their implications. In the face of this upheaval, businesses will change, and keep changing. And the agencies that support them and speak on their behalf must do the same. For all the talk of a “return to normal”, or even a “new normal”, it looks increasingly likely that we will emerge into a world defined by constant change and unpredictability. Perhaps the only thing “normal” about the “new normal” is that nothing will stay normal for long.
The inauguration of Joe Biden and the unveiling of his ambitious climate plan was only the most recent reminder that the climate crisis is not going away. Businesses and governments are putting sustainability increasingly high on their agendas, and the sharp reduction in emissions over the course of last year made it clear, even to the most stubborn sceptic, that it is man who is harming the global ecology, and who must change the way he lives to mitigate the damage. The private sector has an immense role to play in this; Jaguar has committed to going 100 percent electric by 2025; Ford, too, has promised to be ‘green’ by 2026.
Meanwhile, social distancing and lockdown restrictions have deepened and strengthened the culture of convenience that was already reaching maturation before the events of 2020, forcing brands to find ever-more creative ways to give consumers what they want, when they want it. This has been driven by mega-brands, such as Amazon, and ‘disruptive’ tech companies, from Deliveroo to Uber, but it has been embraced and carried forward by innumerable other businesses unable to sell in person during the pandemic.
Related to this is digitization, the need for which was thrust remorselessly on businesses in almost every sector in 2020. It is a major reason for the rapid rise and proliferation of new forms of media, as well as changes in consumption habits. And all these trends are increasingly interweaving, overlapping and at times, converging—with transformative consequences for how we do business.
It is because of this convergence that new models are needed. We have already seen the way in which the fashion industry has risen to the challenge. Online-only brands, such as ASOS, have pioneered an industry model adopted to an increasing extent by their high-street counterparts, from Zara to H&M. Amazon Fresh is making grocery shopping more convenient than it ever has been, presenting itself as a quicker alternative to supermarket delivery.
At the other end of the spectrum, stubbornly “physical” sectors, such as property and automotive, are under growing pressure to evolve. Through a computer screen, a potential home-buyer can now take a virtual tour of a number of properties, comparing prices and communicating with an agent in real time. And we can perhaps anticipate that the days of the car showroom, salesman and test-drive are numbered—or, at the very least, that that model will now have to compete with one that involves the online purchase of increasingly eco-friendly cars and delivery to your home within a matter of days.
But business, and indeed sector, transformation is only one piece in the puzzle. As they evolve, the agencies on which they rely to communicate with consumers and potential consumers will have to evolve with them. Agencies are increasingly appreciating that, to support their client brands in our new era of customer engagement and delivery, they need a different set of capabilities and to offer a different set of services. Those that do not accept, and indeed, embrace this change, and therefore do not proactively look to expand their offering, will lose ground quickly—both with their existing client base, and in the race to acquire new business. Agencies will need to consider new partnerships. They will need to think about mergers and acquisitions to scale quickly. Organic development alone will not take them where they need to go at the speed they need to get there.
Put in broader terms, we can at least predict that the more progressive agencies serving those businesses undergoing transformation will move rapidly towards the model that predominates in more progressive, online-first or online-only spaces, such as tech. In this world, rich data allows for the creation of complex audience profiles and precise targeting, and near-constant engagement by brands ‘with human faces’, through diverse media, is becoming the norm. Content creation and optimisation are high on the priority list; the line between AdTech and MarTech is blurred; and the order of the day is to fully ‘future-proof’: able to adapt to the inexorable changes already underway in the business world and the ones that will surely follow.
Taken to its conclusion, what we are talking about here is the transformation of entire business ecosystems: complex networks of organisations that must evolve together. Each “node” must aggressively digitize and get to grips with data, remaining mindful all the while of its need to be sustainable and to maximise convenience for its audience.
So what does this look like, exactly? It’s a brave person who tries to predict the future with any real precision. But what we can say is that the business world is changing dramatically. If last year’s watchword was “uncertainty”, perhaps 2021’s will be “evolution”.
Chris Sahota, firstname.lastname@example.org
Ciesco is a leading specialist M&A firm with a focus on the technology, digital, media, and marketing sectors. Headquartered in London, with offices in Germany and France and operating globally, Ciesco offers a unique combination at partnership level of senior industry practitioners and sector specialist investment bankers.