Are traditional agencies, like Euro RSCG, out of date?

Losing two key businesses – The Sun and 3 Mobile – in quick succession must have, in no small way, aided the exit of Euro RSCG London chief executive Mark Cadman this week after months of speculation.

The Havas-owned agency network failed to make the final round of pitches for the £13m account for The Sun and News of the World, that now resides with WCRS, and last week suffered the ignominy of losing the £30m 3 Mobile account to digital agency Glue without a pitch.

Just 18 months ago, Euro RSCG landed the mobile operator’s account against start-up Hurrell & Dawson and Glue, which seemed to indicate that despite a subtle shift in the power brokers of adland, the most prestigious accounts remained with the bigger, traditional agencies. When Glue was unable to convert 3 Mobile into a win the first time around, and also failed to pick up the £10m Eurostar ad pitch earlier that year, to some observers it was a case of a digital agency trying to bite off more than it could chew.

Wider appeal

But with 3 Mobile now widening Glue’s remit from its digital account to encompass advertising, the agency is no doubt feeling more than a little vindicated.

It has spent the past few years increasing its offering to become a full-service advertising operation. It falls into that small,but growing pool of digital specialists looking to widen their share of clients’ marketing budgets.

Albion is another such agency which has been able to evolve from its digital roots to take on the traditional ad shops. This year it has bagged the advertising accounts for the relaunch of Virgin Radio as Absolute Radio, Remington, Accurist and Gumtree, and last year it was appointed to eBay’s account.

The move by Albion and Glue is indicative of not just what is happening within agencyland, but also the place digital has earned among the minds of marketers.

Time to reassess

Other companies, such as Electrolux, are reassessing their marketing mix. While Alexander Darwazeh, Electrolux senior brand director for Europe, Middle East and Africa, says it plans to keep Lowe as its lead ad agency, it is currently putting its pan-European digital, CRM and DM accounts out to tender, with a number of undisclosed agencies lining up to pitch, including Lowe, whose own problems – at least in London – make Euro RSCG’s more bearable. Darwazeh says the review is part of a new marketing strategy which will see a 30% reduction in its television and outdoor spend into digital, CRM and experiential marketing (MW this week).

Simon Mansell, managing director of full-service digital agency TBG, says it makes sense for clients that want to get more for their money and increase their focus on digital to give the lead to digital agencies, and claims some are already doing so.

He adds, however, that not all digital agencies are capable of making the full-service transition, pointing only to AKQA and R/GA as the next possible contenders.

Different strokes

Yet even he remains reserved over whether digital agencies will be able to fully grasp offline. “TV and online are becoming more similar because of the amount of videos being produced. But you need a different mindset for press, outdoor and radio,” Mansell says.

But Albion managing director Jason Goodman argues that such a point of view is a “myth”. “It’s a slightly pathetic excuse that network agencies have been sayingto clients for too long. You only have to look around and see which agencies are really struggling – Lowe and Euro RSCG. These were once great companies which are finding it difficult to justify their existence,” Goodman says.