Thinking about the agency model
What companies want most from their marketing agencies is more sales.
Yet agencies are not set up to do this. In fact, clients aren’t set up for this either. Agencies earn their fees by trading time for dollars and some earn commissions on media spend or printing. Marketing departments manage their vendors as cost centers. There is nothing wrong with this age old model, it just means that an agency is motivated to do what it does.
Likewise, clients have learned to manage the agency as a cost center. So it makes sense due to the inherent inefficiency of the agency model, that you have high client turn-over and pressure to reduce price on work that is essentially a commodity
What would you call an agency with no graphic or interactive designers on staff? An agency that is proud of the fact that it has never produced a brochure. What kind of agency would this be? How does an agency explain how simple tweaks that integrate interactive with the sales process and measuring engagement instead of exposure and building branded content that supports informed decision-making are the killer competencies that clients should buy?
So what does an agency do? So what should an agency become?
In my company, there is the growing realization that reinvention will happen. Agencies must become an accountable piece of the sales process. The problem we’ve had growing this approach is that most large clients are not prepared to address real performance based compensation plans. There are too many complicating factors that make program measurement too complex.
On the other hand, the inevitable convergence of sales and marketing drives the realization that one-to-one communication is becoming more important than mass marketing messages, especially in B2B. Our ability to impact the sales pipeline is truly our core competency. The question is how do we reframe our business model so we are massively rewarded for helping our clients meet their sales goals?
If you enjoyed this post, please consider to leave a comment or subscribe to the feed and get future articles delivered to your feed reader.
Robert Scoble, in his review of Do It Wrong Quickly says the following: “What’s the one thing companies care about? Conversion. Getting potential customers to convert into real, actual, customers. But how do you do that in a world of Facebook, Google, YouTube, blogs, and Flickr? Mike Moran shows you how—by trying lots of little things, studying the results, learning quickly from your failures, and doing it all over again. He gives you a framework for getting over your fears of talking with your customers without a committee to protect your behind. Great book.”
I’ll read this book over the weekend and try to report back.