In yesterday’s Online Spin, there was an article Agencies: Reinvented or Replaced by Joe Marchese.

Joe’s jist was that ad agencies need to change – that they aren’t prepared for the future of advertising within social media. Here’s what he says,

“In the end, social media is nothing more than a mirror of people’s real-world behavior (albeit amplified and with extreme ADD). If you’re taking steps to make your brand relevant to people in the real world (which I sure hope you are), then it’s not that big of a leap to figuring out how to make your brand relevant to people in a social media context. Social media should be a valuable tool for helping you answer that billion-dollar question of what will make your brand relevant to people, as well as the platform spreading your brand’s message as you achieve greater relevance. It’s listening and talking, instead of just talking.

Agencies certainly have the talent to listen. Some of the best and brightest are hungry to take on the challenge of building the iconic brands that shape our lives, and would love the opportunity to feed back the voice of the people they are talking to. But the current brand-agency relationship isn’t set up for this task – and, more importantly, isn’t compensated for it. Are agencies set up to have a conversation for your brand, or has a mandate to only be the brand’s mouthpiece crippled agencies from truly activating your brand in social media?

It’s this question that has led many to wonder if brands should be handling the activation of social media in-house. It is a valid point. If it’s true that brands’ participation in social media means much more than simply buying media and blasting the “big idea,” can agencies fill this role?

I believe not only that agencies can, but that they must. Because unless agencies participate in social media, their role as stewards of brands will eventually end — and their greatest fear, a future where their services are nothing more than a commoditized function performed by Google and Microsoft, (http://www.iht.com/articles/2008/06/22/business/ad23.php), will come true. If your function can be performed by a computer, it will be. Fighting this, rather than focusing on the areas that cannot be done even by the mighty Google’s algorithms, is a losing battle. The future of agencies lies in more than knowing how to get in front of the right people, but also in knowing how to talk and listen to those people to shape a brand and its message.”

While I’m an advocate of what Joe is saying about social media and the commitment to it by companies, I’m confused about how an agency would change to deal with this. This is a fundamental shift in thinking.

Is an agency really set up to change from push to pull? From messaging to conversating? Why must an agency deal with this at all? It’s not like advertising is going to go away. To add a social media department within the agency (essentially buying your way into social media) isn’t the answer because then you’ve got competing factions within the agency. One that pushes messages out and one that participates in the message.

On the outside, it may seem like a good idea but as soon as one of them starts making more money than the other, agencies tend to be biased in that direction so neither the message nor the conversation works.

So then it must go in house? I don’t believe that is the right call either. What I’ve found with in-house marketing is that it isn’t strong enough or large enough to participate in the conversation. There’s too much going on for a one or two person marketing department. Even larger companies are cutting the head count.

Then what is the answer? I believe social media is an entity to itself and must be treated as such. The new kind of connection agency will emerge that will consult and participate with the brand’s messaging in mind – but they can’t be held to the same standards as a traditional agency.

In other words, you can’t punish them for finding out people think your product suck. You should reward them with finding out the insights on why the product sucks and their ideas on how you can make it better. They will keep you in the loop and connect you with your consumers and your partners.

You may think these guys and gals are just research then but research is and should be at arm’s length just observing what is happening and reporting on that. Connection agencies are knee-deep with the consumer. Consumers should know that they are part of the company – transparent and authentic – and that they can help get them an answer that maybe customer service couldn’t understand or deal with.

You are also in the long haul with this kind of company. This isn’t an RFP type of arrangement. This isn’t somebody you can throw to the curb after a couple of years – or just because you want to jump to the hottest connection company of the year. They are just as essential as your operations department.

Maybe I’m wrong about this but I think agencies aren’t the right place to put this type of communication. Let them do what they are really good at…clearly communicating your message. Let the connection agency find out if it’s working and if your products are delivering the goods.