Marketing disrupted - Right-sizing the agency model

Marketing Disrupted.

Right-sizing the agency model.

Robert Green, Managing Partner

[email protected] 380 610Twitter: @robolivermxLinkedIn: Robert Green

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Stampy the Cat - 5,818,322 subscribers

Disney animations - 2,255,239 subscribers

Stampy - 3,353,080,883 views

Disney - 1,428,665,972 views

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CHANGING COMMUNICATIONS

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“A wealth of information creates a poverty of attention”

Krystal Higgins, Sr UX designer, Google

MARKETING SPEND AS A % OF COMPANY REVENUE

The CMO Survey February 2015.

INCREASED DEMANDS ON SPEED TO MARKET

•Real time marketing & content marketing have completely changed the

time available to plan and manage campaigns

•Campaign lead times are being cut by up to 1/3 and the race to be faster

is constant

•Marketers need to react quickly to events – or their competitors will

•Less time to do things well

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THE PERFECT STORM?

•More demand for content

•More channels to market

•More complexity and sophistication of technology

•More competition

•More testing and learning required

•More pressure on the client / agency relationship

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WHAT DOES THIS MEAN FOR PURCHASING?

•Purchasing is being challenged to deliver more value

•Right-sizing your supply chain will only go so far

•To really deliver value and efficiency, you need to right-size your agency

model

•How you work with your agencies is crucial to success

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MARKET ORIENTATION

Sustainable client benefits

Competitor differentiation

Operational capability

NOT MARKET ORIENTED

Market share - 30.6% in 2000, 50% in 2007, 3.1% in 2013

Value - $62.50 per share 2000, $7.86 in 2015

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MARKET ORIENTED

16% of revenue is from completely new product sectors – they have

invented categories

Market cap grew in 2014 by more than the complete value of Google

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ARE AGENCIES MARKET ORIENTATED?

WHAT?

HOW?Most agencies

deliver their services in the

same way.

WHY?What is the purpose of agencies?

Type of agency – network, digital, social, brand,

promotional, advertising etc

TURNING DISRUPTION INTO OPPORTUNITY

Retain the quality of “WHAT” agencies do

But revolutionise “HOW” they do it

“WHY?” Purchasing and marketIng alike can achieve better results by

turning disruption into an opportunity

Failure to adapt in this disruptive world will deliver diminishing results

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AGENCY PRODUCTIVITY

The traditional advertising agency model features:

High indirect costs – Business costs such as pitching, offices and

salaries need to be recovered through high fees

Lack of transparency – The real effort and who is working on a project is

often hidden

Too distant from the point of need – Collaboration is key to efficiency

and productivity

Insufficient reporting – How much performance data does your agency

give you?

Agency structures have remained relatively consistent for decades

RIGHT-SIZE YOUR AGENCY MODEL

•Part way there by right-sizing the roster. . .

•Achieve better value by right-sizing your agency model

THE RIGHT-SIZED MODEL

•Agencies must adopt lean principles whilst inspiring and harnessing talent

•Built around the method not just the output

•Must be amorphous, adaptable and dynamic

•Communication needs to be continual, fast and at the point of need

•Agencies must change from being introspective…

•… to oriented around the client’s needs to be effective in a fast, disruptive

world

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“Today's digitally-empowered marketing ecosystem is clearly defined

by a ‘whole different dynamic’ than in the past – meaning agencies

urgently need to adopt new working patterns”

Marc Strachan, VP Marketing & Multicultural Marketing US, DIAGEO, WARC 2015

To find out how OLIVER can help you right-size your agency model, get

in touch with us at [email protected] or 0203 142 3593.