Why be based next to a “silent lake” when you can be close to a “hot spring”?

Why are there a disproportionate numbers of agencies based in London?


Probably part of the answer is the same explanation as to why there were so many cotton mills in Manchester – geography.  The cotton mills were near raw materials. London agencies are near to an unrivalled (in Europe) array of production resources.


But computers and digital networks make physical proximity to production resources increasingly irrelevant. In theory, production can be done anywhere…just squirt the artwork or the video down the line!


So what factors will explain agency clusters going forward?  London’s always going to have the advantages of access to a huge pool of talent and the kind of cultural influences I discussed in my last post.


But the decline in the importance of being physically close to production facilities means that the distribution of agencies throughout the UK could well become more proportionate over time.


In an industry that’s increasingly influenced by technology, it seems to me that more and more agencies will cluster around hubs of innovation. Gaining personal access to the latest developments in technology could become a significant competitive advantage for the smart agencies of the future.


It could also give those agencies a much better chance of securing the next Google as a client when the founders are still in their garage rather than going for their initial IPO!


If I’m right, then this is good news for Bristol.


McKinsey with the World Economic Forum have just published a global map that identifies the world’s most important innovation hubs.


Bristol comes out as a “hot spring” – a small, fast growing hub on track to be a world player. London is labelled a “silent lake” – an older, slower growing hub with a narrow range of large established companies.


In fact, when I come to think about it, part of the reason I setup 3Sixty was my contacts at HP Labs in Bristol back in 1994. Some of the technical team working there at the time were real Internet pioneers, and when I got chatting to them I was fascinated by the possibilities that this new innovation had for advertising and marketing (I was working in a conventional agency at the time).


So there’s one small example of how an agency got started because of proximity to a centre of innovation.


I’d be interested to hear if anyone else has got other examples.


Right, time for me to nip round the corner to Bristol University to see if I can find the next Sergey Brin.


P.S. Off to South Devon for a week’s holiday on Friday…so no blog next week.