The parking garage at Resource/Ammirati says IBM iX now. It’s official. You’ll see a stream of “so and so got a new job, congratulate them” notifications on LinkedIn as some of the 10,000 or so employees start to update and adjust to their new group identity.
And then there’s the party.
You know an organization is huge when they have to rent out the entire Columbus Commons to host a party for their current and former employees, as Resource did earlier this month.
All of this has us wondering… who’s next?
We asked two local agency founders for their best bets on the next breakout agency in town. Alaina Shearer is the founder of both Cement Marketing and Women in Digital. Robert Abbott is the Senior Partner and Founder of Context Digital, his former agency Shift Global was acquired by Moxie (A Publicis company).
What are the ingredients?
In order to cast our predictions, we must first understand what the basic ingredients are for an agency to have that breakout potential. The ingredients that make an agency successful, edgy, and irresistible to a much larger organization.
Alaina: “Right time. Right place. And a hell of a lot of work until that moment to make sure you’re prepared to seize the opportunity. It’s not as sexy as you would think because behind the scenes of any amazing start up or agency is a pile of failures and losses that teach you lessons on how to make yourself better and ultimately more prepared for the moment when that huge account shows up.”
Robert: “I think the landscape is changing. The factors that made agencies successful in the past have much less relevance today. Simply put, it comes down to results. Brilliant thinking that clearly understands and motivates its audience. Actual and measurable business metrics. Smart is the new Creative.”
Does size really matter?
I think of some really small operations, even one-woman shows, that have a groundbreaking approach and put out world-class work… But it feels unlikely that they’ll be scooped up any time soon, mainly because they are so small. So, what about scale? Is there an ideal size for an agency to be acquired?
Alaina: “My understanding, without expertise or formal training, is that a successful acquisition depends not on an agency’s size or even revenue, but on the agency’s health. Those acquiring agencies are looking to ultimately buy the agency’s processes, its book of clients, past case studies and its top senior level talent.”
Robert: “It’s really about the numbers and how the acquisition enables the acquirer. Roughly speaking, I think critical mass starts at 5 or 10 million.”
The times, they are a changin’
I worked for an agency only a few years ago and even since then it seems that the landscape has changed quite a bit for those “full service” shops. If you’re not hyper specialized at this point it seems nearly impossible to differentiate and the business is changing almost too fast to keep up with. What about the landscape of agency world in general? What do you think the future of agencies looks like?
Alaina: “This is an excellent question and one we discuss a lot internally at Cement and within the Women in Digital organization. It appears that clients will continue building in-house agencies for years to come. However, these in-house teams are better suited for production of larger creative and strategic visions laid forth by outside agencies. Ultimately, the in-house agency is here to stay, but that means agencies will be hired far less for production services. Ultimately, that’s a huge blow to larger agencies but a huge win for smaller more strategic agencies like Cement.”
Robert: “I think it looks very different, so much so that we may want to revisit what the term “agency” means and whether that is even relevant in this transforming business climate. The firms having the largest impact are those that are focused on substantive results, evaluated purely on the customer’s terms, not the creative director’s clever late night vision.”
Fortune telling: part of the business
So the Mad Men era of brilliant, tear-jerking campaigns delivered by whiskey-breathed dudes is officially closing. Brands across the spectrum are pulling their heavy creative lifting in-house. Can agencies still play the role of advisor? Where are your clients most often seeking your counsel and thought leadership? (Well, lets be realistic here, the really smart clients might be actively seeking it… the others just need to be convinced that they need it!)
Alaina: “Not much has changed since our founding in 2009. The clients have grown, of course, but it’s funny because no matter what the size of the company their number one question for Cement is always, ‘how can we make a mark with our digital presence?’. Ultimately, they’re trying to authentically deliver their brand message within the digital space. The challenge for us as an agency is to sort out their existing presence and then reorganize the content, how their audience sees it, how it should be seen and then build and execute upon a strategy and plan to make it happen.
Robert: “They are seeking Experience Strategy and Design. They need help sorting through the myriad complexities of their business stakeholders, audiences, channels, data, etc.. They want help figuring out how all of it fits together and adds up to differentiating outcomes.”
There are some great buzzwords in those answers that I have been speculating on: audience and experience being the two main ones that pop out to me. I guess we’ll just have to see where the perfect convergence of data-driven, audience-targeted, and experiential shows up next. Our contributors were far too modest to reveal their top contenders for local agencies that fit the “recipe” (😉). … But we want to know if you’ve got any local agencies that come to mind? Place your bet in the comments.