The following post is by Jules Ehrhardt, partner of design studio ustwo. It was originally written as a comment on a excellent post by Matt Edgar about agencies building products, republished here raw without edits and with his permission. I thought it was a great follow up to Josie’s post about ‘saving the agency’ and another perspective on the hot topic. You can follow Jules on Twitter here: @ezyjules.

There is close to zero chance to any of the big guns pulling ‘product’ off without completely gutting and refitting themselves, which would take till 2020 if it was even possible, by which time their model will begin its extinction cycle. Ad agencies are dinosaurs in terms of size, agility and long term prospects. They had a blast in the Triassic (50′s to 80′s), a boom in the Jurassic (90′s to 00′s) and now we are at the start of the Cretaceous (2010 to 20??). We are witnessing them lumbering towards extinction as the environment around them changes and slowly starves them of food.

Your choice of the words ‘lip service’ are apt as I believe in 2013 we are going to be seeing a whole lot of posturing from Ad and marketing agencies pretending they are anything other than ad and marketing agencies. We will be seeing, incubators, product, experience, UX whatever pose they feel they need to strike to stay relevant in the next age, whilst nothing will in essence change. Regarding the inevitable in-agency incubator trend, personally, I wouldn’t trust an ad agency to design the product or service of my startup, maybe maybe to sell it later, but not to design it.

Nike Plus is heralded as the future of the brand / agency model. It is truly a wonderful fusion of product, brand and lifestyle. However, name another example of something of its calibre, just one. Ad agencies simply cannot do it. Having just about gotten their heads around building websites (in the context of useful product, let us ignore Facebook fan pages, micro sites and pointless branded apps – (see they can’t even ‘do’ mobile without screwing it up.

So are we to assume they can now handle UX and product? Good product and service design requires a bottom-up grounding in an absolute understanding of and respect for the end user. Marketing and advertising relies on a top down ‘big idea’ approach all pushed by a Creative Director mega ego. Cue girl on roller-skates with puppies on a leash showing us just how much fun the menstrual cycle can actually be. Ad agencies hide the people actually solving for the client’s needs, the creatives, behind bloated layers of account management to ensure maximum billing whilst everyone plays agency snakes and ladders, to the client’s detriment. Their choices and actions are driven to win awards in a big Cannes industry circle jerk, when the ultimate truth and reward for those in Product is numbers of end users and real user ratings and feedback.

The ranks of Ad agencies are populated with generations of individuals who only know how to peddle ideas to their clients, like drug pushers. They are packed to the rafters with generations of marketeers who have only ever known one way, certainly not user centred method or product design. The new ways scare them and they won’t risk their pensions and mortgages and get off the wave. These people are unwilling and incapable of change.

As institutions, ad agencies are geared to make money, to bloat projects, to burn hours. That makes them money. No doubt the media groups will continue to reel in billions in the mean time, raking the money in from the core-collapse supernova. They are the masters of selling with their intoxicating theatre and they will sell for years to come to clients who equally have built careers cosseted by their side of the same cycle. Working light and agile, minimum viable product, iterative design, product budgets, user centred design are all foreign concepts. Ad agencies will never risk the golden goose, and why should they, except that the goose has a terminal prognosis. They will be found out.

The sad truth is that the Ad and marketing industry represents possibly the largest cohort of enabled, young, creative, talented, problem solving people in the developed world. Imagine what amazing things these people could achieve if not focused on selling the latest toothpaste brand? If people want more, to help build products and services, real things, useful to real people then leave the industry and go to an industry that does this. Clients are sobering up to what they hell they have been spending hundred’s of millions on, they are seeing through and beyond and demanding more. That process is beginning to take place and will only gain momentum.

Product and service design is the work and world of design studios (note, not agencies) who have been doing this thing for decades, IDEO , Continuum, Frog, Cooper as well as the new generation of digitally focused product and service design studios. Product design is a different industry, not a subset of the media industry. It is not a part of a 360, integrated, full service, (insert any media group cliche here) service offering. You might as well be asking lawyers to perform brain surgery by asking Ad agencies to ‘do’ product’.