Because I'm not out here to try to pull A Clockwork Orange.

Do I have your attention? The fuzzy economics of agency-client relationships

I run a creative agency.

We, like any business, make money by creating value in a marketplace. Or put in economic terms, we are suppliers looking to fill a demand.

It seems to me too often both the buyers and sellers within the agency-client exchange lose sight of what that value actually is supposed to be at different moments in time.

When that happens, we tend to misplace our resources, have the wrong conversations and measure the wrong things.

THE PROBLEM

We are typically hired by marketing teams. But marketing is every aspect of bringing the product to market – from its inception to its design to its pricing to the experience around it and where and how it’s delivered. And while it can be productive for an agency to consult on all of this in a more holistic way, clients are mostly looking to their agencies for help with promoting a brand, product or idea.

Which means our core product is media — an ingredient of marketing of course, but not the marketing itself.

This may sound pedantic, but the distinction is important. If I am a tomato producer my goal isn't to make tasty salsa, it's to make ripe and juicy tomatoes. Yes, good tomatoes help make a good salsa, but the process of making tomatoes is entirely independent.

So what happens if we strip this all down to an econ 101 view of the client-agency relationship knowing they are in need of media to support their marketing.

First it means our primary marketplace is...

THE ATTENTION ECONOMY

The demand in the attention economy is generated by organizations seeking value in one of two overarching ways:

  1. Facilitating commerce through (a) introducing a new brand or product to an audience and how to buy it directly (i.e. sales activation), (b) creating brand salience so people consider the product when they are in the market for it (i.e. brand building), or (c) generating additional demand for a product category that is undefined or under-developed (e.g. “got milk?”).
  2. Facilitating the flow and control of information as a means of obtaining and maintaining social status or power. This is one of the few desires that persists across all economic and political systems around the world and has been true from before the advent of the printing press and the invention of capitalism.

The supply in the attention economy is the attention of an audience and those parties who are able to harness it. Think of attention as the raw resource (like oil or gold) and each company in the supply chain as the ones leveraging that resource to deliver on the demand (like miners, refineries, transporters, wholesalers, retailers, etc).

Attention is an incredibly scarce resource because it (a) cannot be divided – you can only genuinely focus on one thing at a time – and (b) can only scale within the confines of one’s unoccupied waking hours.

A more complex, globalized and competitive marketplace has increased demand within the attention economy. But ironically with more demand, the supply becomes more scarce because we overload the audience's attention.

Given that attention cannot be divided, the more messages you put in front of someone, the less likely they are to notice them.

One of two things happens: (a) their brains automatically deprioritize it and it becomes white noise that they are never actually conscious of or (b) they briefly evaluate whether they want to invest the time then either give it their continued attention or dismiss it to move on to something else they feel is a better use of their time (i.e. our ever-shortening “attention spans”). And that evaluation of “worth” is ongoing – if you’ve ever pulled out your phone while watching a movie on the couch you understand that.

More than $0.99 of every dollar spent in the attention economy is pure waste given that thousands of organizations are paying to put a message in front of us daily yet we can recall three to five of them if we are lucky.

Imagine going to a restaurant and never receiving any food but being asked to pay your bill just because you sat down. And having that happen more than 99% of the time. That’s pretty much what this entire "attention" industry is built on.

No wonder why many of the most valuable companies on the planet earn their wealth from holding choke points within the attention economy (e.g. Google, Meta, Tiktok, etc). This also speaks volumes to just how valuable attention is perceived by those who want to buy it.

As a company operating within the attention economy that produces media, we are paid by organizations on the premise that we are uniquely capable of both capturing an audience’s attention and maximizing the benefit of that impression.

That includes three components:

  1. Having expertise on where and how to get in front of a specific audience in the most cost effective manner (i.e. channel expertise).
  2. Skill at creating media that disrupts brain pattern recognition and becomes a resonate signal instead of noise. (i.e. creative expertise).
  3. The ability to craft a messaging approach that is more likely to be effective in accomplishing whatever the buyer’s goal is. (i.e. strategic expertise)

But if we are unable to actually "mine" the raw resource - the attention of the audience - then we haven't actually generated any value at all.

Enter another marketplace that is inextricably linked with attention...

THE ENTERTAINMENT ECONOMY

The demand in the entertainment economy is generated by people with disposable time who are seeking ways to fill it with something they will enjoy. Or put another way, it’s where people choose to place their attention when it is otherwise unoccupied. The primary source of entertainment – in terms of hours spent – is through the consumption of media.

The supply in the entertainment economy comes from many different types of sources, but as it pertains to media it’s quite multi-faceted: from traditional media companies (both mega conglomerates like Disney and smaller players like our own indie film distributor BRINKvision), to interactive media (such as gaming, which is 3x larger than music and 4x larger than the movie industry) to the “creator class” of self-publishers across social channels, Youtube, Twitch, etc. and owned channels like Patreon and OnlyFans.

In addition to these media suppliers, people also voluntarily create and distribute their own content in the marketplace. (Digression warning: The wicked brilliance of the social media business model is participants are providing a free supply of entertainment while also feeding the demand side at the same time because the act of creating content serves as entertainment for them. People are effectively cooking their own meals then bringing them to the restaurant and serving them to other patrons for free while the restaurant gets to profit from it all.)

A supplier of entertainment media makes money one of three ways:

  1. People buy it from the creator (e.g. rent a movie, subscribe to patreon).
  2. An organization pays the creator as a form of propaganda (e.g. sponsored content).
  3. A third party platform facilitates delivering the media to the audience and sells their captured attention to advertisers, then shares — usually a small piece of it — back with the creator.

Given that the vast majority of attention as a resource is harvested through providing entertainment, it’s impossible to talk about supplying attention without talking about supplying entertainment. The harnessing of attention supply is dependent on delivering on entertainment demand.

THE BOTTOM LINE

You cannot be an effective media supplier to the demands of the attention economy without seeing entertainment as your core function.

If you fail to entertain, you are either holding your audience hostage in the in-between moment before they can get to the entertainment they are seeking immediately causing friction and frustration (not a very good look for your brand) or you are just white noise hovering on the periphery of culture, spending a lot of money for attention and receiving very very very little in return.

Either way you are the restaurant patron paying the bill on a meal you never actually enjoyed. Doesn't matter how good that salsa might taste if nobody's eating it.

That's why I used to run a creative agency.

Now I run an entertainment media company.

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