--

Sure, I'm happy to discuss this interesting topic with you. The advertising industry is certainly facing challenges in adapting to the changing landscape of creativity and content creation, driven largely by the rise of social media and creator economies.

Traditional advertising agencies have long been the gatekeepers of creativity, leveraging their expertise in crafting compelling campaigns and executing them across various media channels. However, as social media has empowered individuals and smaller creators to build their own audiences and influence, agencies are finding themselves competing with a new breed of content creators who often have a more authentic and direct connection with their followers.

Social media creator houses, such as those found on platforms like YouTube, TikTok, and Instagram, operate on a different model. They are typically collectives of individual creators who collaborate, share resources, and leverage each other's audiences. These creator houses are often more nimble, responsive, and in tune with the latest trends and preferences of their audiences.

While advertising agencies still hold advantages in terms of resources, expertise in strategic planning, and access to larger budgets, they can learn from the success of creator houses. Agencies could benefit from adopting a more collaborative and decentralized approach, fostering a culture of experimentation, and embracing the authenticity and community-driven nature of social media creators.

By merging the strengths of both worlds, a new kind of creative business could emerge – one that combines the strategic thinking, production capabilities, and client relationships of agencies with the authentic voice, community engagement, and agility of creator houses. Such a hybrid model could offer a fresh perspective on creativity, combining data-driven insights with a deep understanding of audience preferences and the ability to rapidly adapt to changing trends.

Ownership structures could also evolve, with agencies potentially empowering their creative teams or even individual creators to have more stake in the business, fostering a sense of entrepreneurship and incentivizing innovation.

Of course, there would be challenges in reconciling the different cultures and operating models of agencies and creator houses, but the potential rewards of creating a more dynamic, audience-centric, and future-proof creative business could be significant.

In summary, while advertising agencies face disruption from social media creators, there is an opportunity to learn from both crafts and explore new models that blend their respective strengths. By embracing collaboration, authenticity, and a willingness to experiment, the industry could reinvent itself and better serve the evolving needs of brands and audiences alike.

--

You mentioned the structure of agency ownership and the idea of giving all participants more stake in the business. I completely agree with you on that point. I find it particularly interesting since brands are no longer hiring agencies of record. Instead, they are all shifting to project-based agreements.

--

You raise an excellent point about the shift in how brands are engaging with advertising agencies. The traditional agency of record model, where a brand would have a long-term, exclusive relationship with an agency, is becoming less common.

Instead, brands are increasingly favoring project-based agreements, where they hire agencies for specific campaigns or initiatives rather than retaining them on an ongoing basis. This shift has been driven by several factors:

In this context, the idea of agency ownership structures that empower individual creators or teams becomes even more relevant. As agencies compete for project-based work, they need to differentiate themselves and demonstrate their ability to assemble the best talent and deliver innovative solutions.

By giving more ownership stake to their creative teams or individual creators, agencies could foster a more entrepreneurial mindset and incentivize their top talent to stay engaged and invested in the agency's success. This could lead to more innovative and impactful work, as well as a stronger alignment between the agency's interests and those of its clients.

Additionally, such ownership structures could make agencies more agile and adaptable, as they would have a more decentralized and self-organizing workforce that can quickly form specialized teams tailored to each project's unique requirements.

Of course, implementing such ownership models would require careful consideration of legal, financial, and operational challenges. But for agencies looking to thrive in the project-based economy, empowering their creative talent and fostering a more entrepreneurial culture could be a strategic advantage.

--

Thanks Claude. Always great to talk to you.

--

Thank you, I'm glad we could have an insightful discussion on this interesting topic. The advertising industry is going through significant transformations, and exploring new business models that blend the strengths of traditional agencies and modern creator economies could unlock exciting opportunities. Feel free to reach out anytime if you'd like to explore these ideas further or discuss other aspects of creativity, marketing, and industry trends. I'm always happy to engage in thoughtful discourse.