07/08/2015 What communications agencies can learn from Apple
I read this article earlier and it really hit home with my world in communications. In summary, despite Apple blowing away Wall Street expectation on both revenue and net income, Apple stock has fallen 12% in the two weeks since it announced Q2 earnings. That has wiped out most of the gains so far in 2015.
Why did this happen when profits were up 38%, sales in China doubled and iPhone unit sales were up 35%? Because even though profits were up, iPhone sales (63% of Apple’s revenues) missed expectations. And when a company relies so heavily on one product, when you miss numbers, people begin to get nervous.
Diversity in product and geography is key to long-term sustainability in business. Apple is currently relying on one product to prop up investments and underperforming product lines (iPad sales were down 18% year on year). “If one product goes south, another should be able to pick up the slack…in the grand scheme of things Apple has almost no diversity in products.” And that is making investors nervous.
This principal is exactly why I am so confident and excited about the communications industry at the moment, it has diversified dramatically.
10 years ago, in the infancy of my career, a communications agency probably had one core service, public relations. Yes they might have multiple offerings within that umbrella (consumer, corporate, b2b, investor and analyst relations, financial) but the objective and tactics were largely the same – generate press coverage in physical earned media in a particular region.
Today, communication agencies that thrived over the years are ones that diversified from this structure. In addition to generating coverage in physical media, they probably have specialists in online earned media as well, they probably have a content creation team, they probably have a social media team, and the most forward thinking of agencies probably now have media teams and strategists thinking about communications across the entire paid, earned and owned space (anyone who hasn’t yet should read up on the PESO model). Plus the internet has allowed agencies to think and execute globally more easily.
This is exactly what we doing at Way To Blue and I am proud to be working with some of the most talented people in the ‘new’ communications today. We are investing in Creative, Media and Research as part of an ambition to become a bigger, better and more diversified business in the future. We are also one of only a handful of independent agencies who are doing this globally for our clients. Again something I am really excited to be involved in.
Written by Marc Berry Reid