Most of the large advertising agencies know they face a huge challenge, but the cover story from today's Australian Financial Review (behind paywall) has reinforced my view that the industry is entering a period of extraordinary pain.

On the one hand, the article was refreshing, as one agency after another spoke about moving away from the "production line" model in which every client gets one big idea which becomes a television commercial which reaches most of the country thanks to the power of prime-time TV. There was recognition that change is inevitable. All well and good.

But the alternative vision? Well, there was no agreement there, and some of the arguments put forth in this article were highly suspect.

In particular, I was astonished by the following quote, which the AFR attributed to Britain's Institute of Practitioners in Advertising: "Already, consumers are creating their own forms of advertising, free of commercial imperative, in the form of social network sites."

Their own forms of advertising?!?!

For anyone who is confused, let's see how the American Heritage Dictionary of the English Language defines advertising: "The activity of attracting public attention to a product or business, as by paid announcements in the print, broadcast, or electronic media."

Advertising is about paid announcements. It can inspire or be inspired by word of mouth, but advertising in itself is not word of mouth. End of story.

In my view, large advertising agencies have to choose between evolve beyond advertising or getting used to providing just one piece of the marketing communication puzzle.