Brands want fewer agencies, more specialists — report
A recent study finds widespread dissatisfaction on both sides of the advertiser/agency divide. Nearly three-quarters of major multinationals are reviewing their current agency arrangements, looking at whether they have the right mix of agencies and capabilities in their external partners.
Future of agency rosters
The Future of Agency Rosters, by World Federation of Advertisers (WFA) and The Observatory International, has found that many clients recognise their current roster setup is not working effectively, rating it just 5.7 out of 10, where 10 is fit for purpose. Agencies have been even more sceptical about the effectiveness of current roster arrangements, scoring them at just 5.2 out of 10. The findings are based on responses from 50 multinational marketers representing a total global adspend in excess of US$69bn. Twenty-six agency representatives contributed, with more than 50% in global/regional roles and the balance evenly spread across the globe.
The current dominant model of agency management is “multiple agencies managed individually by marketing” (81%), with “integrated lead agency” (44%) and “network agency with specialisms from same holding company” (39%) coming next. However, many advertisers use a variety of core models across their operations, underlining the complexities of developing fit-for-purpose roster architectures around the globe. And that challenge may become more complex because, while nearly 60% said they were looking to reduce the numbers of agencies on their roster over time, in answer to another question, just over 50% said they were seeking to increase the numbers of specialists they use. Eighty-two percent of advertisers don’t foresee a world without agencies.
Agencies feel that clients do not provide them with the right tools to deliver the expected results. Collaboration may be hindered by internal structures (51%), poor quality briefings (49%), approvals and sign off processes (40%), and lack of trained client personnel (40%), as well as lack of a clear data strategy (52%). All of which, they argue, undermines the quality of agency work.
Internal structures an encumbrance
Clients agree and nearly 50% recognised that their own internal structures may be an encumbrance to operating the most-effective roster model. However, clients feel that agencies across the ecosystem have some way to go to provide quality delivery. The biggest areas of concern are ROI measurement across channels, when it comes to informing the whole roster through data, analytics and insights, as well as clearly understanding the end-to-end consumer journey.
Eighty-four percent of clients also believe that agencies are struggling with martech – and 71% of agencies agree – underlining the complexities of this area and the reason that management consultancies have spotted an opportunity.
“These [global] findings do not surprise me at all. Our interactions with local marketers confirm that the same or similar challenges are being faced in the RSA marketing ecosystem,” says John Little, The Observatory International regional managing partner MEA, “particularly a desire for simplification and the elimination of duplication of effort.”
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