Just 8% of brands are ‘very satisfied’ with their agency partners

As more brands consider taking activity in-house, how is the client-agency relationship changing and do marketers have greater control?

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Brands’ relationships with the agencies that deliver their creative work are no longer as simple as they used to be.

As digital channels began to grow more important a decade or so ago, many brands expanded the number of agencies they worked with to generate ideas tailored to those channels. Now many companies are moving in the other direction, but not necessarily going back to the pre-digital model where a lead creative agency and media agency would have been a marketer’s two main relationships.

Pret A Manger, mobile network Three and beauty brand owner Coty are among brands that have moved some or all of their ad creation work in-house, while others businesses have set up startup incubators to help them innovate more quickly and stay ahead of technological developments.

A survey of 200 senior marketers, released last year by MediaSense, ISBA and Ipsos Connect, shows that over half (58%) of respondents believe the number of agencies they work with will decline, while 54% expect to bring work that would previously have been outsourced to agencies in-house by 2020.

“Speed has never been more important in marketing,” says Chris Daly, chief executive at the Chartered Institute of Marketing (CIM). “You’ve got to move quickly to be in the conversation so it is unsurprising that some organisations see value in doing creative work in-house.”

While Daly reckons “the most powerful brands are embracing the fact it is smarter to own their strategy and creative vision than outsource the execution of their ideas”, he believes agencies still have a crucial role to play in “challenging the status quo within organisations and bringing in specialist expertise to take a fresh perspective”.

A survey conducted by Marketing Week shows that just over half (52%) of marketers are fairly happy with the service they receive from agency partners but fewer than one in 10 (8%) state they are ‘very satisfied’.

In one example of an agency group adopting a new model to adapt to clients’ changing needs, Omnicom launched a collaboration network called Shape, which was pitched and piloted by one of its agencies, C Space. It allows clients to tap into the collective talent of the network by submitting briefs to its agencies across the globe. The move is designed to give clients access to a wider pool of talent and enable faster turnaround times as agencies will be switched on somewhere in the world at all times.

Reaching new consumers

Retailer Mothercare was one of the first brands to trial the concept. The brand was keen to attract the 50% of first-times mothers it does not currently know or transact with.

Gary Kibble, global brand and marketing director at Mothercare opened the brief to the network and was able to see the conversation threads and ideas that were picked up and developed by various agencies in different locations. The brand was then able to filter first-stage ideas and tighten the brief to hone results and the concept. Following this, a session was then held with the agency to see what could realistically be implemented.

Kibble says: “In some respects it would be easier for any agency to say, I have identified your business problem and here’s a solution, but if a client doesn’t feel real ownership for the implementation of that solution then it won’t be delivered. This brings us into the process rather than presenting it with a bowtie on.”

It will depend on the size or scale of the brief as to whether Kibble will use the platform again but he agrees for “overarching business challenges you need to cast the net further”.

Felix Koch, managing director at C Space, admits: “There is a trend towards relying less on traditional agency structures and thinking about how you can create a network of experts to work on briefs.” As a result he reckons other agencies will start to “experiment” with a network approach.

Creating ideas in-house

There are some creative ideas that don’t require agency input, particularly around content creation. Mobile network Three relies on a “mix of activities” but has a studio in-house to enable it to “turn content around quickly” and get higher customer engagement.

Director of brand and communications, Lianne Norry, says: “If you think back ten years [brands] would have one main agency; now the demand is on expertise in different channels. You [need to] have a broader cross-section as well as bringing the expertise in-house.”

Technology brand Lenovo, meanwhile, looked to users rather than agencies to create a video and TV campaign for its Yoga products in a bid to attract a younger audience. Lenovo used a crowdsourcing platform to develop ideas for the campaign before deciding on the concept of showcasing ‘life hacks’.

Talking at Marketing Week Live last month, Lenovo’s worldwide brand director Jo Moore, said repositioning the brand “started a tide of change” for the business internally in terms of its approach, and allowed it to “embrace new formats and ways of working”. She said: “You have to be open to new ways of developing this kind of content.”

The brand created TV shorts and videos showing how people use its products in innovative ways, which eventually required the help of a content agency to capitalise on the response.

Focus on trust

Trust is the top attribute that 67% of marketers look for in agency partners, according to the Marketing Week survey. This is followed by creativity (64%), flexibility (58%), collaboration (55%) and cost efficiency, which 52% of respondents class as a key quality.

Perhaps surprisingly, under half (47%) require their agency partners to be on top of new technology and just 18% look for a willingness to take risks.

Agencies aren’t necessarily delivering on these core requirements, however. Just 15% reckon agencies fully deliver on trust (scoring it a five out of five), while the highest proportion (46%) give a score of four. Just 29% are positive that agencies deliver cost efficiency (scoring it a four or five), while 26% give it a score of one or two suggesting they are not happy they are getting what they pay for.

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Comments
  • Richard Tidman 7 May 2016 at 9:17 am

    I totally agree that there is a huge opportunity for brands that are willing to take more responsibility for their output. At Space66 we help brands do this by bringing digital production in-house. It’s a simple idea but can one that can have a huge impact by boosting speed to market, providing far greater flexibility, saving money and increasing confidence and capabilities within the marketing department.

  • Vic@programarketer 10 May 2016 at 4:40 pm

    I think agencies in many regards are still playing by rules that were created many years ago. Brands want and need solutions, not just plans or ideas.

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