I just finished reading the updated version of The World is Flat by Thomas Friedman.
I am sure many of you have read it, and for those who haven’t, Friedman examines the many influences shaping business and competition in a technology-fueled global environment.
He gives several examples of how businesses need to catch up with technology and how the Internet has brought the idea of globalization to the forefront of everything we know.
The communications industry is mirroring Friedman’s observations and has hit a major inflection point. Quickly passing are the days when PR firms, marketing firms, and advertising agencies each had their own piece of the communications puzzle. Today, each industry is vying to capture a share of the market created by the Internet.
Meanwhile, today’s businesses see the Internet as a single entity. Isn’t a blog a blog?
Not to the communications industry. PR firms want to craft the messaging on that blog; marketing firms want to use the blog as a platform to promote their brands; ad agencies want to monetize the blog through advertising. Each brings a different strategy -- and, of course, required payment options -- to the table. It is hard for a company to understand three different strategies and pay three different firms for the same blog.
At the same time, communications companies are starting to offer the same kinds of Internet-related services, such as search engine optimization (SEO). Today’s businesses are smart enough to know they need this kind of service, but they are confused about whom to buy it from, since everyone offers it with their own methodologies behind it -- usually stacked in favor of their core business.
And this is just the beginning. It’s no longer true that it’s tough to apply ROI to communications services. The Internet has changed all that; today you can follow the path of prospects and see what led them to a particular Website as they click on a banner ad or type keywords into Google, etc.
So as the economy stabilizes and more dollars are allocated to digital communication strategies, I believe we will undoubtedly see communications companies form strategic partnerships with each other to offer complementary services. We will also begin to see a series of mergers and acquisitions designed to offer businesses a single approach to their communications needs.
Finally, I believe we will see new business models being formed in the communications sector, models that will combine the right team with the right financial structure. The smart group will figure out how to combine several traditional business models together to create the one-stop communications shop.
There needs to be a clear and immediate understanding across each industry that the walled gardens are coming down. Advertisers need to take note, because today’s graphic design and media buying requirements need to be developed with a corporate story in mind or influenced by a business’s keywords. Marketers need to take note that whatever they are marketing must be wrapped around a company’s corporate messaging and the perceived value to their audience. And PR people need to take note that they need much wider distribution platforms, the ones advertisers and marketers can provide.
You can quickly see where the inflection point lies and how convergence begins to make a lot of sense. I look forward to seeing how it all plays out.
— Todd Barrish is a communications consultant.