August 14, 2013

Agency Business From A Different Perspective

I don't usually post Op-Eds, but this one is good. Last week I published a piece called, Do A Few Things Well. The point was that agencies should stick to their knitting and not try to be everything to everyone. Patrick Strother, who is ceo of Strother Communications Group says "not so fast." Patrick agrees that "if you think you are an ad agency, that’s what you should mainly do..." But he points out that there are agencies, including his own, that started with a totally different premise.

I normally agree with you, but you have missed the mark by quite a bit with this post. Right off the bat, there are two entire markets you're missing with this point.

The first is there are thousands and thousands of emerging and middle market companies in America, many of them B2B oriented, that are looking for a full external marketing resource. They typically have one or two people coordinating their marketing and want one small agency to handle all the external marketing for them. I've billed millions of dollars to this emerging segment and helped many of them successfully grow from start-up or small to very successful enterprises.

Secondly, many markets want a specific external specialty that trumps the silo mentality of products and services they offer. For example, medical device companies want an agency that specializes in medical devices, not traditional advertising or PR or social media, direct response, search and so on. So the specialty in this case is a market focus, not a product focus. Food, agriculture, certain tech, lots of B2B and many others share this perspective.

The other point that is ignored is that it is indeed possible to specialize
in marketing integration. Being able to successfully combine (optimize) an array of services for a B2B or middle market business adds tremendous value, and can lower marketing cost by 20 to 30%. At least that is our experience the past 21 years.

One of my big complaints about teaching advertising and PR the past 30 years is that the cases are generally big companies with huge budgets. That's not actually the real world. There is a huge market out there for small agencies skillful in delivering a wide enough range of services to be considered an external marketing “department”. These budgets are generally $100,000 at a time, not a million at a time but nonetheless, it's a very rewarding segment to serve because you can make a real difference.

We have a number of these types of clients we have grown with for over 15 years, mainly because we understood their business and market so well, now no one specialty agency could possibly serve them better.


solo ads said...

Great post..’ Thanks , dear you nice sharing with me.

It is very effective for me, again thanks……

Lisa Calhoun said...

Bob, couldn't agree more with your points about the relevance of small, market-focused agencies in b2b (like mine, a tech PR firm out of ATL). You're spot on with the budget, and spot on with how meaningful the work is to the client--it's a joy to help a smart, growth-stage company soar, at a price/value relationship that doesn't hobble the money they need for hiring. Appreciate the perspective.