The majority of major brands are reviewing their agency rosters as they admit that their current set-up is not fit for purpose.
According to a study by the World Federation of Advertisers (WFA) and management consultancy The Observatory International, clients give their current agency rosters a score of just 5.7 out of 10, where 10 means they are fully happy with the effectiveness of their set-up. That concern means three-quarters are reviewing their current arrangements to ensure they have the right mix of agencies and capabilities.
The current dominant model is “multiple agencies managed individually by marketing”, used by 81% of brands, followed by “integrated lead agency” on 44% and “network agency with specialisms from same holding company” on 39%. The figures show that advertisers are using a variety of core models, underlining the complexity of managing those rosters both globally and across disciplines.
That dichotomy is most felt in the fact that while 60% of brands are looking to reduce the number of agencies on their roster, 50% are looking for more specialist agencies. Yet what is not expected is for agencies to disappear, with just 18% foreseeing a world without them.
Roel de Vries, global head of marketing, communications and brand strategy at Nissan, says the figures reflect a “fundamental shift” in the way consumers behave and access media.
“Advertisers need to take the lead in developing a new kind of partnership if they truly want to achieve one to one marketing at scale. That requires new skills but also involves working closely with their agencies, which often have huge knowledge about the companies they work with,” explains de Vries.
While brands may be sceptical about the effectiveness of their current set-ups, agencies are even more so, scoring roster arrangements just 5.2 out of 10. The research finds that agencies feel clients do not provide them with the right tools to deliver results, with 51% blaming internal structures, 49% poor briefs and 40% lack of trained client personnel.
Some 52% cite concerns over the lack of a clear data strategy, and 40% the approvals and sign-off process, all of which, they claim, undermine the quality of agency work. For brands, the biggest areas of concern are ROI measurement across channels and understanding the end-to-end customer journey.
“These findings highlight the challenges that each side faces and there’s clearly plenty of improvement that everyone can make. Whatever roster arrangements brands develop, they should ensure that they can deliver on their promises to their agency partners. Without that, no roster model will be able to work effectively,” says WFA CEO Stephan Loerke.