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Consulting firms like Deloitte and Accenture are
increasingly being seen as coming for ad agencies’
Their pitch to marketers such as Chipotle: we can help
you with complex challenges, and can build digital products
that can transform your business.
Still, consultants will have to prove they can weave
creativity with technical know how.
Here’s why ad agencies need to worry about consulting firms:
traditional ad shops can’t handle burrito orders.
At least, that’s what the consultants say.
Chipotle has recently tapped Deloitte Digital to
build and maintain its Apple and Android Apps as it looks to
implement mobile ordering across its network of restaurants.
On the surface, that may not seem like that big a deal. It’s just
app after all.
But as consulting giants like Accenture and
Deloitte circle around the ad agency business, it’s
partnerships like the Chipotle app that some in the ad industry
see as a harbinger of things to come.
They say that while traditional and even digital ad agencies are
still great at making ads and buying media to make sure they get
in front of the right people, they aren’t as well equipped to
make apps that are so vital to a company’s business – let alone
all the billing, data collection and logistical implementation
And as digital customer experiences become a crucial part of
marketing – people are literally holding a company’s brand in
their hands after all – the argument is that consulting
companies, with their informational services heritage, are best
equipped to handle this kind of work. And the more that the
Deloittes of the world can get their hooks into marketer’s
operations, the more ad assignments they’ll be entrusted with
– which puts classic ad agencies in a disadvantaged position, or
so the thinking goes.
Indeed, in the ad industry, where the future of the ad agency
constantly being examined, consulting firms have become the
new bogeyman. Fair or not, firms like
Accenture and IBM are seen as having
a better claim on driving real business results in an
industry known for making pretty ads and making sure they get
where they are supposed to.
What’s so great about consultants?
Greg March, the CEO of the independent ad agency Noble People,
summed up the conventional wisdom regarding consulting firms as
thus: “They’ve got MBAs, they’ve got money for days, and they
have access to the C-suite decision makers.”
Consulting giants have also been making lots of acquisitions in
this sector of late; last year,
Deloitte bought the San Francisco creative agency Heat, reported
During an interview at the Cannes ad festival in June, Michael
Kassan, CEO of the ad advisory firm Medialink, even
predicted that a giant consulting firm would end up buying one of
the big four ad agency holding companies like WPP or
“The real difference is, we bring a few things they don’t have,”
said Donald Brady, principal, Deloitte Consulting LLP and
Customer Experience Innovation Leader at Deloitte Digital. “We
have deep industry expertise and can handle complex technical
solutions. [Agencies] are coming from creative world. They
don’t have the depth or scale.”
Brady noted that Deloitte Digital last year recorded $27 billion
in revenue and has a network of over 10,000 people in
By nature, companies like Deloitte see themselves as playing a
more integral role in helping assess and improve their
clients’ businesses that goes well beyond marketing.
“Our clients come to us with really big challenges.
Transformational challenges,” said Oliver Page, Principal at
Deloitte Digital. Transformational challenges such as changing
the way people order and pay for food in thousands of restaurants
– a behavior which is increasingly becoming the central way
people interact with many brands.
Page said that in the quick service restaurant category, it’s
very early but in some cases ordering via apps is accounting for
1% of a company’s business. Chains like
Panera Bread have seen digital ordering take off, as Business
Insider reported in June.
“That channel really is becoming a huge revenue driver for
restaurants,” said Page.
“It’s moving quickly. What you end up having when you interact
with your customers is a much richer data set. That’s what is
unique [about what we do]. Making ordering easier or more
convenient is what consumers are looking for, and it is what the
brand represents. And making these things work in the real world,
it’s not easy.
“This is a testament to where the market is going,” Page
Left brain vs. right brain
Perhaps. For his part, March argued that both ad agencies and
consulting firms have their natural strengths and weaknesses, and
that each side’s weaknesses can be addressed by hiring different
types of people.
He admits to being biased, but he believes it will be easier for
ad agencies to hire more analytic-driven people than for
consulting firms to get more creative.
“From what I’ve heard from people who have worked on both sides,
the consulting firms are not really strong on how to engage
creatively,” he said. “A culture of creativity is really hard.”
March said that agencies are hardly bereft of offering
their clients potential ways to change their businesses. The
question is, do they know how to execute them?
At the same time, consultants have to prove they can deliver on
ad campaigns that work. “The knock on these guys has always been,
they give you decks and then leave,” March said. “They’ve got to
change that. If you are going to charge somebody $2 million for a
strategy that’s one thing, but now they are going to have to
Gene Liebel, co-founder of the digital agency Work and Co, which
works with Facebook, Apple and Marriott, and others, agreed that
in 2017 more marketers need help building digital tools to help
them directly interact with their consumers. But he also doubted
whether consulting firms are up to the task of handling the
little things, or can attract the right talent to deliver.
“Someone still has to do the hard work of designing and building
successful digital services, and that execution piece is what’s
actually the toughest,” he said. “The talent pool for the
best engineers and best digital designers is surprisingly small,
and those people are drawn to places where they can go beyond
just concepting great digital experiences. They want to make real
things. And actually witness their ideas make it out into the
world to be used by real consumers.”
In other words, Chipotle’s app better work really well. Or like
many marketers, the company might soon be looking for a new