There is growing evidence that a massive sea change is underway in the brand marketing and advertising agency world. The pace of agency reviews has quickened over the past two years. In the past month alone, a number of high profile brands have put their media accounts up for review with a staggering total of $25B now in play. In addition, according to a recent study, agency tenure has been declining steadily as clients continue to consolidate, with 51% declaring that they have been reducing their roster in the past 3 years, and 44% say that they plan to consolidate further. And this is just the tip of the iceberg. Brands do not want to be tied down to their agencies for long chunks of time. Agency consultant Avi Dan recently wrote of a ‘phenomenal shake up on Madison Avenue.’ You can ready Avi's great article here: http://ow.ly/3xVEL5
So is this the beginning of a new playing field for agencies and clients? Here's why there is new and massive opportunity for marketers and agencies.
1. Marketing has changed more in the last two years than in the past 50. By definition, the way brands select and work with agencies needs to change-dramatically! The level of complexity, the art and science straddle, understanding and leveraging data, the explosion of channels, the availability of information and how to seam it altogether into a cohesive experience for the customer are just a few monumental challenges marketers are tackling. Coke announced recently that they are adding Ogilvy, a creative shop(typically not involved in media reviews), to their media agency short list, declaring that they are also reviewing their agency 'model'.
2. Agencies’ cost structure-With many individual challenges to solve as a marketing leader, can a brand afford to keep spending big bucks and tie the knot with one agency that may or may not be able to help them solve all of their issues? The big agency cost structure continues to balloon and with profitability levels challenged, prices for big agency work must to press higher. At cross purposes now are the marketers that need to work more efficiently and surgically to address their pain points.
3. Rise of more project focused assignments-The challenge-focused approach to marketing has increased the number of project based assignments doled out. With unplanned issues becoming the norm, as is re-writing the script, marketers are more apt to be on the lookout for agencies on a project basis that can solve the matter at hand.
4. RFP’s are a waste, right? There has got to be a move away from RFP’s. What as waste of everyone’s time and money. CMO’s need to skip over the laborious agency selection process and instead network and social search their way to solving issues, leveraging the most suitable agencies along the way.
5. What have you done for me lately? The success of an agency in the past does not mean a thing about success on the new marketing playing field. New companies are hitting the market that are delivering results that marketers are looking for in the digital/mobile world. And perhaps the big players of yesteryear will not be the go-to shops of today and tomorrow.
6. Need for speed-Brands need to stay relevant and competitive. They need to be ‘of the moment’ so therefore time is of the essence in hitting the market and capturing opportunity. The nimble agency will be more valuable in pushing through projects quickly, effectively and efficiently.
7. Specialization Rules-The complex nature of the marketing business today, whether offline vs. online (and the channels within each), paid vs. earned, native vs. banner, social/influencer, data, analytics and technology, requires a specific expertise for success. Can one agency really tackle all of your marketing issues?
Marketers are moving away from traditional approaches to their relationships with agencies forcing the big agencies to adapt yet again. Smaller, entrepreneurial shops are gaining traction. For agencies, hundreds of millions of marketing dollars will be up for grabs in the coming 12-18 months. For marketing leaders, the stakes have gone up, the puzzle pieces have increased but the ability to take your brand to new levels has never been more attainable.
Dan Sixsmith is a VP at Alinean, Inc.
He is Founder and CMO at Trammel Holdings and Chief Content Officer at "The Digital Advantage by Dan Sixsmith."
He is also co host of the weekly Podcast, This Week In Digital Marketing subscribe here: http://t.co/H6wqFueAB2
No comments:
Post a Comment