WPP Chair Sir Martin Sorrell recently drew some parallels between big agencies current struggles with "getting" online and the trial and error involved in mastering the new medium in 1955, television. Sorrell's take is that they managed to figure out television, and the same will happen with digital. Eventually, the gap between the expertise of the traditional agencies and the start ups that specialize will narrow, the barriers will come down, and new media will cease to be "new" and will become just another channel in the agency's arsenal.
While Sorrell admits the analogy has it's limits, I believe there are some distinct differences that agencies will have to pay close heed to:
Digital Transfers Control to the Consumer
Television, while a discontinuous innovation over radio, still left control in the hands of the message producer. The consumer was left to passively digest the message. Digital transfers control over to the consumer. The brand message depends on the nature of the interaction and is shaped more by the watcher than the teller. My experience is that agencies are really struggling with this transferrance of control, and it's scaring the hell out of them. Television was a technological advance, but the nature of interaction with the recipient had more to do with new capabilities through that technology (adding sight to sound) than with a fundamental change in the interaction itself. Web and digital turns the entire paradigm on its ear.
Television had a Kinder, Gentler Adoption Curve
Agencies had more time to get up to speed with television. It took longer for television to gain penetration in a critical mass of households, and it wasn't nearly as dynamic a marketing channel as digital. Internet adoption has been tremendously fast, and the technology changes daily. Even for those who live and breathe digital, it's a challenge to keep up to speed with the rapidly changing nature of the many faces of digital. For a stodgy agency that has a tremendous amount of inertia, it's impossible. Consider the fact that most agencies are just now adding search capabilities, and in the meantime an entire industry has grown up and is capturing almost half of every online ad dollar spent. You just can't be that slow to react in the new digital world
Televison Required a Power Construct
Even with television's slower adoption curve, the agencies had the advantage of the fact that television ads are costly to produce. There were few organizations with the resources required to produce television, so the agencies didn't have nearly the degree of competitive infill that is true in the digital world. Democratization of creative development has meant that anyone can produce digital marketing messaging. Television required power constructs, distribution and large budgets, digital doesn't.
I don't believe large agencies can count on the time being available for a slower assimilation of digital expertise. The new world belongs to the fleet of foot, and I haven't seen the traditional agencies winning any foot races lately.