Successful Agencies Don’t Just Excel In One Particular Channel

March 15, 2010

According to Forrester Research…“There will be a reduction in the role of channel specialists. As marketers seek interactivity, agencies that subsist will forgo their role as channel specialists and dedicate themselves instead to determining how to change the relationship marketers have with their end customers”.    Source: Shar Van Boskirk, Forrester Research, Jan 12, 2010


Today’s successful marketers have realized that it isn’t good enough just to excel in one particular channel. Multichannel marketing companies absolutely need to spend as much time on their “old” channels as they do with their “new” ones. The biggest problem these marketers face, is finding agency partners that think the same way.

While the entire buzz right now is centered on subjects like making iPhone apps, Twitter strategies, Facebook and search marketing, the reality is, if the rest of your channel marketing sucks, then an iPhone app isn’t going to make a big difference. Likewise, if your in-store (or branch) experience is disappointing, that won’t make up for a lackluster online experience. The key to success is to spend some quality time looking not only at each of the channels individually, but more importantly, at how they intersect with each other to deliver the overall brand experience.

To help understand the philosophy, I would like to share a quote from Jack Aaronson from ClickZ.

“I’ll use a folklore tale of an architect. According to the story, an architect was hired to design a college campus. He put up the buildings but created no sidewalks. When the head of the school asked him where the sidewalks were, he replied, “The students will create the sidewalks.” Sure enough, a year later the architect visited the school and built paved sidewalks where the students had created well-worn paths in the grass”.

This implies a truly customer-centric (needs-based) design approach and we can all learn from this story as we create a methodology for modeling multichannel behavior. You’re most likely aware of how consumers act within a specific channel. You may know how to create the best brick-and-mortar experience, catalog, Web site, kiosk, call center, sales office, Web 2.0 widget, and the like. In the story of the architect, these channels are the buildings. They run fairly well on their own. But how do users move between them? What paths do they create? And, most important, how can we analyze the paths’ success and value?

The first step is to understand the paths people are taking between your buildings and why. Once you create the sidewalks that let them do this easily, everything else will follow suit. The technology exists to track these sidewalks, attribute value to them, and credit the channels appropriately.

Agencies that truly understand this philosophy and embrace it will become leaders at delivering the consummate “Customer Engagement Experience” and assume their rightful place at the head of the client’s agency roster.

Already missed your Q1, 2010 new business targets?

December 1, 2009



If you did not start your 2010 new business preparation and prospecting activity back in at least September of this year, you have probably already missed your Q1 new business numbers for next year!

 Back in July of this year I published a blog post entitled “Ad agencies…2009 is over. Focus now on 2010”. I know it seemed far too early to be thinking about next year, when most of you were still stuck in the trenches fighting to deliver on current year targets. The reality is however that it was not too early at all.

This time of the year is normally characterized by missed new business targets, disappointed management and the start of the usual end of year agency new business professional musical chairs.

 If you are indeed just starting your 2010 new business planning and prospecting activity now, your efforts will probably have little to no impact on the first quarter of next year. The prospecting work undertaken during the last 3-6 months of this year will determine your success (or not) in the first part of the New Year.

 If you find yourself in this position here are my suggestions as to what you might do:

  • Do not delay any further, start your planning immediately.
  • Communicate with your agency management team and let them know that you may well be behind the eight ball. (It’s better to be upfront than wait for the surprises and the resultant disappointments).
  • Review your Q1 targets for 2010 against your current pipeline and activity. Be honest with yourself and realistic.
  • If necessary adjust your Q1 targets accordingly. (DO NOT just push numbers around. That means don’t just move the dollars to later in the year, keeping the same overall target. You may just be arranging a stay of execution.
  • Execute against your plan, track your progress and keep lines of communication with your management team open.




Goodbye Brand, Direct and Digital…Hello People to People Marketing!

October 8, 2009



person to person 2


Marketing communication has evolved from the early one-way media (TV, print, radio) to two-way media (Internet) and now multi-way media (social, mobile). As the lines between these channels and media are blurring so quickly, it has created an identity crisis among many agencies.

Can a direct marketing agency be effective without digital and social media skills? Can a digital agency deliver the best work without direct marketing skills? Is social media just another word for PR, or is it in fact the ultimate one to one medium?

Traditional marketing and advertising thinking is no longer effective as consumer media habits continue to evolve.  Branding is for all intents and purposes dead, as most consumers’ first impressions of a brand are what they find in search results or what they read from other people in reviews. As consumers circumvent traditional media approaches, they are gravitating towards those media/channels that provide easy access to information, advice and recommendations, plus allow them to socialize and be entertained at the same time. In the process, these consumers are building and refining their own trusted personal networks.

The opportunity for agencies and marketers alike is clear. Forget about continuing to structure your organization in silos like brand, direct, digital and social marketing, and start to think about People2People marketing. If you can integrate your marketing efforts and succeed in motivating customers not only to interact with you, but to share their personal networks with you, you will have created a powerful channel for your brand in the marketplace.

Those of you who are direct marketers will be disappointed to hear that targeting is dying too. As consumers change to pulling information as they want or need it, push marketing becomes less and less relevant no matter how “targeted” the marketer thinks it is. No longer can you just drop an email to your house file or run a banner campaign with the simple objective to sell more products or generate more leads. You have to become part of the conversation, where they are and when they want to have it. Also, keep in mind that conversations cannot be bought either, and if they are the community often quickly finds out and retaliates.

The new age of People2People agencies have to be experts in understanding consumer habits and expectations in this new media environment. They need to be the unbiased filter that prioritizes the media/channels and indentifies the ones that will yield the greatest ROI.

This new breed of agency will avoid the temptation to shout messages at consumers disrespectfully or target thousands of people multiple times (reach and frequency). Instead, they will embrace techniques that cultivate genuine and open dialogue with customers, where brands quietly listen and learn, and then respond with new features and product innovations that better match the needs of the consumer.

These agencies will be rewarded by clients who not only out perform their competitors, but also deliver industry leading financial results. You may be interested to know that in July 2009, a report by social platform provider Wetpaint and analyst firm Altimeter found that: “Companies deeply engaged in seven or more social channels (blogs, branded social websites, Facebook, Wikis, ratings and reviews etc.) significantly surpassed their peers in terms of both revenue and performance.

Future growth and success will be led by those agencies that embrace this new media environment and choose to become part of a new breed of People2People agencies. Those who remain siloed will continue to become less relevant over time and unable to deliver against evolving client expectations.




“Socialnomics” The Fuel For Future Ad Agency Growth

September 10, 2009

Social media has created a fundamental shift in the way we all communicate. In the process, we sometimes lose media, develop new media and in some cases see traditional media adapt to the new sociology and technology. A excellent new book titled “Socialnomics” explains how social media has transformed both the way we live and the way we do business.

Yesterday I was searching through some YouTube content when I found this great video about the book that highlighted almost 40 observations about the impact of social media. Some of them might be considered predictable, but many are really eye opening. What’s even more amazing is the speed at which these shifts have taken place, as well as the sheer size and geographic impact of many of them.

When I consider all of this from an ad agency perspective, it all just seems so overwhelming, yet exciting at the same time. From a sheer speed perspective, how does any agency be it specialist or full service keep up? How do they monitor these new trends and at the same time develop the expertise and capabilities to competently deliver them. Even more frightening is the concept of how an agency can stay ahead of the changes and deliver innovation and thought leadership to their clients? without resorting to the good old default approach of smoke and mirrors.

Here are a few findings from the book that I think you will find thought provoking:

  • 25% of search results for the World’s Top 20 brands are links to user generated content.
  • 90% of people who can Tivo ads actually do it.
  • 25% of Americans have watched a short video on their phone in the last month.
  • 24 of the 25 largest newspapers are experiencing record declines in readership because we no longer search out news, the news comes to us.
  • By 2010 Gen Y will outnumber Baby Boomers, and 96% of them will have joined a social network.
  • If Facebook were a country, it would be the world’s 4th largest between the USA and India. A true example of a global community.
  • The fastest growing segment on Facebook is 55-65 year-old females.
  • 80% of twitter usage is on mobile devices.
  • Email is passé’. In 2009 Boston College stopped distributing email addresses to young freshman.
  • There are over 200,000,000 blogs out there.

If you have not seen it already, please take a moment to view the YouTube video entitled “Social Media Revolution” by Erik Qualman. I think you will find it well worth your time. I know that it will get you thinking about your agency and whether you have the right plan and resources in place to take advantage of these changes in consumer behavior both now and in the near future. They are the fuel to a whole new world of opportunities for agencies who are embrace the changes and adapt accordingly.





CMO’s Have A More Positive Outlook. Are Ad Agencies Prepared and Ready?

August 27, 2009

CMO outlook

According to the July 2009 “CMO Survey” by Duke University’s Fuqua School of Business and the AMA, CMO’s are looking more hopeful coming out of a gloomy recession. The question that comes to mind now is, do ad agencies have adequate resources to take advantage of this upturn?

59% of the marketers who responded to the survey claimed to be more optimistic about the current economy than the preceding three months. A full 47% reported being more optimistic about revenues from end customers, however, they remain concerned about lagging customer spending.

While increased CMO confidence is great, the big question is just how will their optimistic attitude affect their spending behavior? According to survey respondents, their biggest increases in spending over the next twelve months will be online marketing at 9.5%, followed by new product introductions, CRM and brand building. While overall marketing budgets are expected to increase slightly, respondents reported that they plan to slash traditional ad spending by nearly 8%.

 Customer priorities


While this is clearly good news for some agencies, it may be less so for others. No matter what your agency discipline however, these numbers are a great barometer for agency management as it relates to which capabilities to focus on and invest in. Agencies have in the recent past trimmed down their resources significantly, almost to the point where they have little to no spare bandwidth to handle any proactive or developmental work.

 While online is a very broad category and could probably have been predicted, growth in other areas like new product/service development, CRM and brand building could potentially be big opportunities for agencies of all disciplines.

 Those agencies that have both a plan and the resources to help develop these potential opportunities will benefit from the upturn. Those who are caught by surprise are likely to miss the boat.  





Ad Agency New Business Conversion Rates…The Real Numbers

August 19, 2009


I am certain that we have all been involved in discussions about agency new business conversion rates or asked by management to justify our own. The answer to the question invariable triggers more questions, like: Is this a good conversion ratio and are we competitive? How did you calculate it? Do all disciplines experience the same rates? … I thought it might be time to try and put this one to bed!

It really all boils down to how you measure them.

  • If you define conversions as the number of pitches (pitch being defined as a presentation that in most cases requires speculative work and leads directly to an appointment decision) then the range varies from 25% on the low end to just over 50% on the high end. According to Cleve Langton, in the early part of 2009, DDB were running at about 50%.
  • Alternatively, if conversion is measured all the way back from the RFI stage, then the percentage drops dramatically. The reason being that in the early stages there are so many more competitors, variables and steps to get through before making it through to the final pitch.

The final pitch stage is all about making a final decision as to which of the agencies already selected, is capable of coming up with the superior idea and work to support it. Whereas the first stage is defined by the questions; does the client think you have the right capabilities to handle their business, and do they feel comfortable with the chemistry?

In addition to how you measure, there are also many other factors that can materially affect your new business conversion ratio, either positively or negatively. Here are a few examples:

  • How aggressive your pitch approach is and what type of risk you are prepared to accept going in?
  • Are you breaking in to a new category or are you a known and respected player?
  •  The number of pitches you are involved in at any one time and the depth of resources to support them.
  • Your pricing model and flexibility to negotiate the fee. ( I have had personal experiences where we won the pitch, but decided to withdraw afterwards due to pricing and contract issues)
  • The type of accounts/work you go after. Are they all large budget AOR type assignments or rather multiple small project assignments?
  • Do you have a proprietary system/software that is not available through other sources?
  • Your agency is part of a larger group that consistently refers business to you.

The reality is that there is no one size fits all. Every new business professional and agency CEO will tend to calculate their new business conversion ratio, in a way that reflects their agency in the best possible light. So the next time you feel inadequate during cocktail conversation with industry piers about this subject, just calculate yours again using different measures and assumptions. After all, it’s the bottom line and agency profitability that really matters.



Survey Finds Ad Agency Growth Strategies Missing Critical Elements

August 13, 2009

My recent survey, targeted at senior agency leadership of small to medium size agencies, found that many were missing critical elements required to deliver consistently superior results. Over two thirds of respondents disclosed that during the last three years, unexpected client turnover has caused them to miss their budgeted agency growth goals.

The purpose of the survey was to gain insight into:

  • What tools and approaches are currently being utilized to support agency business growth and profitability?
  • Do current agency business growth strategies address five specific growth pillars? (client retention, organic growth, new business development, resource management & optimization and new capability development and cross-sell)

The response profile was very interesting. 45% came from an Integrated Agency, 40% from Advertising Agencies, just under 7% from Interactive Agencies and nearly 9% from other. (Promotion, PR etc.) It was very surprising that not one response was received from a Direct Marketing Agency.

It is apparent from the survey results, that very few of the agencies who responded have a “Comprehensive Agency Growth Strategy Plan”. Most appear to be taking a more tactical approach, implementing various initiatives on an ad-hock basis, with little to no innovation. This appears to have resulted in inconsistent growth and erratic financial performance. The survey demonstrates clearly that when certain of the key elements of an agency growth strategy are omitted, (The 5 Key Pillars) it results in a direct negative impact on their ability to consistently deliver above average results.

Please take some time to review the survey detail. I am certain that you will find it very informative.