Fledglings come of age

When does the new generation become the new establishment? Agencies looking to make a mark often adopt an “outsider” pose – challenging the brief, challenging the industry, picking an argument wherever there is one to be had.

But at some stage, the Young Turks either have to grow up or accept that they will be forever on the sidelines. In the world of promotional marketing agencies, the moment of decision is usually prompted by growth. Attitude can be shared among two dozen like-minded staff. But what about 60, or even 140?

The results of this year’s Promotional Marketing Agency Reputations Survey suggest that some of the challengers have reached the tipping-point. They are now part of the establishment, joining longer-in-the-tooth agencies as “must-see” choices on any pitch list, even if they still view themselves as up-and-coming.

“We still have an aggressive outlook – it is us versus the big boys. We have that fighting spirit,” says bd-ntwk managing director Steve Pearson. His agency is one of three that have this year broken into the top ten.

Iris, bd-ntwk and Billington Cartmell’s scores from clients put them alongside the establishment agencies Triangle, Arc Integrated Marketing, KLP and The Marketing Store. The achievement is notable because it is based on high scores in all seven criteria on which clients rated agencies. And, with the exception of international expertise, all three made it into the top ten on each score for the first time.

Catch me if you can

Iris joint managing director Ian Millner believes this year’s high score is a case of clients catching up with the agency. “We have not done anything different in the past 12 months than we did in the past four years of life. But we have gone through the tipping-point where, all of a sudden, our reputation and the market’s awareness of us has fallen in line with our capabilities,” he says.

Last year, he described the agency as “a lifestyle, rather than a business”. But what a lifestyle: 2004 has been a year of living famously, as Iris was named MCCA Agency of the Year, scooped the ISP Grand Prix, picked up multiple awards for its work on Puma and the “Sex Lottery” health education campaign for the Department of Health, and squeezed in its fifth birthday.

On the business front, the company has grown to 140 staff. It has opened a retail agency in Manchester, created an experiential marketing division and is working on both a cause-related agency and a female specialist agency.

For Millner, the drive for growth is important. “It is a serious business. It has to be, or you can only ever be a small, niche agency,” he says. Many of the agency’s contemporaries, formed around the same time, have not made the same shift in scale – and as a result they barely trouble this year’s top 30.

Even so, there are challenges still to be met. “Maintaining Iris-ness is a nightmare. It gets harder to run as more people become involved. Iris is about over-delivery, innovation, being challenging – and knowing when to be pragmatic,” says Millner.

Outgrown the idea

“In the past year, we have realised the effect of growth more than ever. As a result, we have reorganised our creative system, and we are becoming more professional in terms of measuring our culture,” he says. Reporting on where the Iris attitude exists and where it needs to be bolstered is now carried out alongside the usual key performance indicators.

Creativity is more important than ever to clients. This year, creative execution was ranked the most important factor when assessing an agency, scoring 3.9 out of a possible 5, with creative concepts being given 3.8. Significantly, director involvement was also rated at 3.8.

Nothing proves more clearly to the market that an agency has creative talent than launching a new service that is truly innovative. For bd-ntwk, the ground-breaking development of Coca-Cola’s music download site mycokemusic.com has been a major calling-card. “It became the top online music vendor in Europe when it launched,” says Pearson.

New line of thought

He points out that this kind of marketing activity involves working well outside the usual sales promotional comfort zone. “To get mycokemusic into the market meant working hand-in-hand with other agencies. This was a brand idea that had been developed the right way round, rather than simply an old idea exploited in different media,” says Pearson.

Free-thinking

Across the promotional marketing agency sector, this way of working is becoming more prevalent. The sense is widespread that agencies are being allowed to break out of the straitjacket of mechanics, merchandise and on-pack promotions. Opportunities are now arising for agencies in this sector to prove that their brand ideas are as good as anybody’s.

“You can’t stay the same. You have to be flexible and respond to the needs of clients. One of the big advantages of our approach is that we don’t view ourselves as being loyal to any medium or technique,” says Pearson.

Lower down the agency ranks, one agency has just broken into the top 20 for the first time, and the reason for its rise up the charts could just be a result of working in this flexible way for many years. Mercier Gray has moved into 17th place, up from 29th last year, having spent the past year on the new business trail telling marketing directors about its solutions- neutral proposition.

“We’ve got what everybody wants to buy,” says founding partner Rob Gray. “As an agency, we’ve been positioned in what’s now called the ‘media-neutral space’ for the past seven or eight years. We are getting in at the beginning of the process and defining the media mix, then implementing it.”

Proof of his agency’s depth of knowledge in this area comes from its involvement in the CIM Media Neutral Planning Best Practice group. With the new openplanning.org website up and running, Mercier Gray is clearly benefiting from the exposure.

At the same time, the agency has introduced a single-solution operation. “We have set up a division which is resonating very well with marketers. Our main proposition is complex, but experiential marketing is very straightforward and people understand it quickly,” says Gray.

An even better insight into what the agency is about is likely to result from the airing of Channel 4 reality television series Going Straight, in which Mercier Gray teaches six ex-convicts how to develop a brand proposition. The show went on air last week.

Big is useful

Billington Cartmell has had more practice at being the next big thing. Founded 14 years ago, it is already a long-term player in the sales promotion industry. Its breakthrough in the survey this year reflects the high profile of a lot of the work it has been doing recently.

“Over the past couple of years, clients have been looking for fewer, but better marketing activities. They are creating events for consumers and the trade,” says managing director Jason Nicholas. “We have a reputation for providing those big brand ideas.”

This year has seen some significant activity from Billington Cartmell. It ran the on-pack, promotional, online and advertising campaigns for Carlsberg’s Your Country Needs You promotion to tie in with its Euro 2004 sponsorship. Factor in other high-profile work for Nestlé, Lucozade Energy and Vodafone, and it is no surprise that awareness has risen sharply.

The agency now has 60-plus staff and is recruiting at all levels, through a mixture of poaching and home-grown talent. “We have a talented and consistent team, but we are always on the look-out,” says Nicholas.

Billington Cartmell’s business growth has been largely organic, through increased investment from core clients. In many cases, the agency is being asked to translate branding into below-the-line activities across a wide range of channels. New business has also been triggered by marketing directors seeing the agency’s work for other brands as consumers and wanting some of the same for their own company. “It makes it easier to get on the pitch list,” he says.

Some things never change

But while the new entrants set about proving that everything in the industry has changed, at the top of the survey table, things stay the same. The top three have simply traded places since last year, the result of a difference of less than one per cent between their aggregate scores, rather than any significant shifts in power.

“One of the things Triangle has in its favour is that a lot of our client relationships are long-standing,” says managing director Nick Hoadley. Triangle has worked with BT for 12 years, Guinness for ten years and Tango for six. Such consistency is one thing the newcomers cannot offer.

“Everybody can have a brilliant idea. But can you keep that up year-in, year-out, making every year better than the last? That is what clients appreciate,” says Hoadley. But despite this longevity, the agency has undergone a lot of changes in the past year. For one thing, it has re-organised itself to bring its previously free-standing retail and design brands, Storm and Percepta, into the main agency brand. And Triangle was hit by the loss of a major client, Safeway, as a result of its acquisition by Morrisons. But Hoadley says: “We have a very full new business order book.”

Echoing other agency bosses, Hoadley reports that clients are changing their way of working. This includes the greater involvement of procurement departments, and also a shift away from retaining agencies towards a roster arrangement. “We have to compete for each piece of work. It is about having a strong idea,” he says.

A prime example of how a well-established agency can still be fresh in its thinking was Triangle’s proposal for Gordon’s gin to sponsor the Turner Prize. “The client wanted to demonstrate Gordon’s as a work of art. We had the idea and then worked with the PR agency and media buyer to put it together,” he says.

As long as agencies keep coming up with strong ideas, clients will continue to use them, whatever discipline they nominally represent. What is clear from this year’s survey is that, more than ever, great ideas are not fussy about the company they keep.

Methodology

Market Management Services interviewed 301 respondents chosen from Marketing Week‘s circulation list. To be eligible for inclusion in the survey, respondents had to be marketers with responsibility for selecting or reviewing a sales promotions agency; and to be working within one of the UK’s top 500 spenders on advertising as measured by MMS. Copies of the full survey are available at &£95, including postage and packaging, from Marva Hudson on 020 7970 6301.