Advertising and marketing communications can have a profound
effect on consumers as well as the financial success of brands.
Like many, I have my particular favourites – from the latest
integrated multi-channel campaign for a leading soft drinks
company, to a TV commercial classic featuring a certain tiger
exclaiming how grrrreat his cereal is...
Digital media, new technology platforms and sophisticated
analytics are enabling marketing messages to be delivered to
customers in ever more exciting, innovative ways and with ever
increasing accuracy. In developing markets especially, such means
are proving critical in enabling brand owners to understand and
reach large groups of emerging modern consumers.
As with traditional marketing communications, promotions and
research, one of the best ways of exploiting these new
opportunities is through specialist marketing agencies.
Often located in the trendiest spots of town and attracting some
of the world's top talent, leading marketing agencies are hubs
of creative and consumer-centric excellence. With global industry
revenues totalling $839bn in 2011*, the value placed in these
organisations is clear.
However, with a myriad of companies and agency models to choose
from and a seemingly endless range of services on offer, where does
one begin in selecting a partner and model of choice? Below are two
initial questions to answer, highlighting the importance of looking
internally before diving into the vast agency landscape.
1. What do you want your agencies to do?
The question might sound obvious, but a clear understanding of the exact activities you wish your agencies to deliver is essential to choose the correct agency model. This in turn can only be determined with a crystal clear understanding of how marketing activity is managed across your organisation today – the organisational marketing operating model, comprising marketing capabilities, processes and technologies – and an understanding of how marketing requirements are likely to shape this in the future. With this in mind, the following must be answered:
- Which marketing specialisms do you want to retain in-house vs. outsource, and to what extent?
- How far up the marketing value chain do you want to collaborate with external organisations?
Decisions will be shaped by corporate and marketing strategies, consumer preferences and industry trends amongst other factors. Final answers will likely be a fine balance of sustainable access to talent vs. cost efficiency and flexibility. It's worth remembering that whilst a skillset could be cost effective to outsource today, should it become a core competency for your particular organisation in the future, doing so could prove extremely expensive.
2. Where do you want your agencies to do it?
As companies expand their brands and products into ever more countries and continents, so too must they grow their agency capabilities. If your organisation is of a size that it is necessary to critically assess an appropriate agency model, it is likely that it is currently operating or is planning to operate in multiple geographies. This drives the need to answer:
- What are your current and likely future brand and product footprints? – considering active geographies, brand portfolios and level of global brand consistency
- How do your markets' marketing requirements differ? – shaped by regulation, consumer trends and media landscapes
Whilst many agency networks and organisations claim global reach, the reality is often less clear cut. Availability of local talent, partial ownership models and affiliate relationships challenge agencies' ability to achieve global consistency. With this in mind, it is essential to be aligned internally on global geographic requirements.
Defining your agency requirements by location will enable you to shortlist agency partners able to serve all business units directly or by leveraging the capabilities located in more advanced markets. The depth of understanding of your internal marketing operating model and of how to optimise it will prove critical, as ultimately, any agency model that is chosen and implemented can only be as efficient and effective as the structure it serves.
Of course, establishing answers to the above is only the start of defining an agency model. Once agreement has been reached, the real work can begin – to look externally and assess the wide variety of agency options on offer. If this topic is of relevance to you or your organisation, I invite you read about our Agency Management service and Point of View – launched February 2013.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.