By Jemelyn Yadao
The recent trend of professional services firms, including the Big Four, acquiring creative and digital agencies has caused a stir inside the advertising and marketing world. Jemelyn Yadao finds out what happens when accountants and creative types meet.
When the creative team members at one of Australia’s most cutting-edge agencies sit down for a brainstorm this month, they are in for a big culture shock. Instead of meeting with fellow creatives, they will be teaming up with professionals from the consulting arm of a Big Four accounting firm.
The new marriage is the result of Deloitte’s acquisition of MashUp – a creative agency that focuses on branding, design and physical space – to create a new spatial and brand experience team at the firm’s Sydney office.
“The daily pattern will be that [the creative staff] will work in blended teams, whether it’s with the customer strategy, digital, human capital or corporate strategy teams,” explains Katherine Milesi, Senior Partner and Customer Practice Leader at Deloitte Digital in New South Wales. “In fact, audit partners are most excited about this because they are always seeking ways to differentiate themselves and help their clients more. We’ve had several audit partners bringing their clients to us and make an introduction.”
Deloitte’s latest acquisition is not unusual. In a sign of disciplinary barriers breaking down even more, professional services firms around the world have been expanding into non-core areas, particularly digital consulting. Through mostly acquisitions of smaller agencies, firms have been growing their digital branding and marketing capabilities to help their clients go through the required corporate transformation to compete in an increasingly integrated business environment.
Some of the services that the Big Four now offer might have seemed incongruous not so long ago, but are now becoming the new norm. Deloitte Digital – what the global firm calls its digital consulting agency – offers creative design, digital strategy, mobile, social, web and digital content management solutions to clients, the same areas that a conventional digital agency would specialize in.
A similar foray into the digital sector was made by EY in the United Kingdom last month. In the first-of-its-kind deal for the firm’s U.K. advisory practice, EY acquired London-based digital design agency Seren.
Meanwhile in Hong Kong and Mainland China, PwC is launching its “Experience Centre” where the firm’s existing talent in digital, customer engagement, analytics and design will be brought together under one roof.
“We already have our lead user experience and creative teams, but bringing that together with our management and strategy consultancy teams enables us to have an even bigger impact,” says Colin Light, Partner and China Experi ence Centre and Digital Leader at PwC in Hong Kong.
Not dissimilar to a conventional creative agency, PwC Hong Kong is currently able to offer a full suite of creative and branding services, thanks in part to a partnership with an agency specialized in design and creative, brand and marketing strategy, social media campaigns and analytics, among other digital skills.
Rather than treating their new teams as bolt-ons, some firms strongly believe that they should be embedded across the firms’ entire consulting offerings. “I don’t think it makes sense to say that you just do creative work at a particular part of the [business] transformation. But you do need to recognize that you have to treat creative and analytical teams differently,” says Light.
The firms have expressed muted interest in doing traditional “creative” work, such as advertising and marketing campaigns, and are focused more on digital consulting to support clients going through business transformation. But observers say there is certainly an overlap that is causing concern for conventional advertising and marketing agencies.
“There has been a lot of consolidation in the [advertising] agency market, particularly around digital players,” notes Jason Chao, Accenture Interactive Leader for Greater China. “With the increasing use of digital channels, marketing is as much about technology as it is about creativity.”
Some see opportunities for professional firms and the creative industry to work more closely together as they often have the same end goals for their clients. “The big advertising agencies do a lot of brand transformational work and in many ways we will collaborate with them in that,” says Light at PwC, which acquired international strategy consulting house Strategy& (formerly Booz & Company) last year, allowing the firm to help clients from strategy through to execution.
“I’m also seeing a lot of [smaller] ad agencies trying to move towards the more transformational work and I think that’s harder as this type of change typically requires deep industry knowledge, as well as both strategy and management consulting capabilities to be able to deliver a truly meaningful change to the business rather than a ‘reskin’ of current practice.”
To be sure, as well as professional firms moving onto the turf of creative agencies, experts say it is also happening the other way around. The marketing industry has been for a while attempting to delve into more business-focused strategic work and away from only doing the ideas part.
Baniel Cheung, Adjunct Assistant Professor of the School of Business at the University of Hong Kong, says this has been particularly evident in the last two years and comes in response to businesses seeking to go about a so-called “digital transformation” – when the transformed business has the characteristics of a digitally integrated organization, including digital marketing.
“In the past, we always talk about doing digital marketing or deploying a digital strategy, but not about linking the corporate structure, a corporate culture and a corporate strategy to digital,” says Cheung.
“Now, with businesses demanding this type of service, big [professional services] firms are acquiring agencies that can help with process reengineering and, at the same time, help clients to build the brand.”
In Greater China, bridging the gap between marketing and digital technology is at the top of the agenda for the C-suite as consumer behaviour shifts to digital and mobile devices. This was a key driver behind Accenture’s decision in July to buy out PacificLink Group, which owns a number of digital agencies in Hong Kong.
The management consulting firm viewed the purchase as key in helping it expand the ability to bring a unique blend of digital design, marketing, content and commerce services to clients in the region.
For Chao at Accenture Interactive, the timing of the acquisition couldn’t be better given the explosive growth of digital activities in Hong Kong and China. “The PacificLink Group companies have a proven track record of creating and delivering an integrated and connected set of differentiated marketing solutions for brands across a full spectrum of online and offline platforms,” he says. “Their capabilities will help us address the needs of chief marketing officers and chief innovation officers in Greater China.”
Deloitte Digital, which launched in Southeast Asia earlier this year, expects to set up additional practices in Asia in the next 12 to 24 months, says Frank Farrall, Lead Partner at Deloitte Digital Asia Pacific. For him, the biggest challenge in offering these new and specialist skills to clients is acquiring the right digital talent on a big enough scale. “We’ve looked at a lot of acquisitions, globally and within the Asia-Pacific region. We assess the businesses for technical quality, creative capability, business management and business acumen, and we are continually disappointed in what we see,” he says. “There’re plenty of really good operators but we believe there’s a really big skills gap around digital talent. When we’re growing almost a billion dollar business you need a lot of people.”
Bringing solutions to life
While the importance of creative capabilities is increasingly being recognized by professional firms, there is still much to learn, perhaps from the likes of Apple.
“[Creativity] is often underestimated by firms that are led by leftbrain people, because it is harder to quantify and harder to break down into a process. But if you look at Apple, the company creates an emotive response with their customers,” Farrall notes, “and they have very rigorous management of their financials and supply chain.” That emotive-creative interaction across a business is critical going forward, he adds.
For the moment, the work that creatives do at professional firms is likely to be more strategic and towards the planning, business development and corporate transformation end of the value chain. “Instead of us putting a PowerPoint together, they may create a proposed customer journey for clients,” explains Farrall. “We can create animated videos to show what the solution would look like, what a customer journey for a transport operator might look like… if people can visualize it and can emotionally connect with it, they are more likely to support it.”
Light at PwC agrees that combining left and right brains is what’s required to get business right today, which is why serious investments in creative and digital talent should continue to be made.
He adds that despite the idea of a Big Four firm housing creative people making headlines just recently, he remembers starting to work with clients in the “broader creative space” back in the early 2000s. “We realized that the challenge was if we develop the strategy and do the operation and execution, sometimes the creative wasn’t in line with that,” says Light. “It’s all about tangible results, which means we need to improve customer engagement, get more customers for our clients and generate financial results through the revenue that those consumers bring. If we can do that with creative, it just makes sense to do so.”
This article was originally published in the September 2015 issue of A Plus. You can also read this on their pageflip edition.