I came across this brilliant post by Greg Paull this week titled “Agency, position thyself” on Campaign Asia. Combining this post and the post by Tim Williams “The Disappearing Agency of Record“, I guess I don’t really have any else to cover on this topic. There is only one word from me “totally agree”. The fact that everyone is trying to do everything is a phenomenon that we have been seeing for a while now (since the dawn of advertising?) and I have to admit, many times I make that mistake as well. Rather than repeating what Greg or Tim already said, I will try to explain a few reasons I think why agencies have been trying to do everything under one roof, positioning themselves as “full service” agency.
1. Everyone wants to become the “trusted adviser”
Yup I hear this word a lot amongst agencies. Essentially its a noteworthy goal to have for any agencies and the trusted advisers would normally get the biggest share of the spend (or fee) and you keep the relationship longer with the client. And to be the trusted adviser, the client needs to depend on you to execute their campaign perfectly hence you want to have the knowledge/expertise of everything or at least broaden your scope.
2. With the growth of Digital marketing, it seems silly not to expand to other new Digital channels/services?
Digital is growing too quickly hence I made the mistake myself, trying to expand to other services to capture the bigger share of the pie. The cold hard truth that I learned was I could never be as good as specialist firms. We may be able to match from concept point of view but execution is another game altogether and specialist firm could often execute very well.
However, I made the decision before to expand to other services, precisely to position us as trusted advisers and being able to take on bigger accounts, bigger campaigns and stay closer to our clients. Our margin from new services didn’t match the margin from our core and we learned the hard lesson that we needed a completely new organisational structure to cover new services and the initial investment was not as small as what we thought.
There another way of expanding into new services by M&A, which many companies choose.
3. Genuine concern over quality done by third parties
Yup this concern is real but it may not justify the need to do everything in-house. It is true that collaborating with other agencies is much harder than working with your colleagues in the same room. And when something fails, it’s much easier to blame the other guy.
Besides quality, timeline is another factor as well. Every agency would want to take a position that is “safe” for its own operation so rush projects are challenging to manage.
It’s essential that whoever plays project management role between different agencies need to have good relationship with different stake holders and understand the campaign flow perfectly. Typically a strong account manager could do this well.
It’s a bit short and I am pretty sure there are many reasons why an agency would want to position themselves as full service but I would think otherwise.
What about you?