The Uber of Agencies: Why Marketers Want to Ride With a New Kind of Shop
Marketers Say Fast-Changing Industry Calls for New Agency Approach — Owning Clients’ Strategy, Data Without Owning the Execution
The agency model of the future might just Uber.
Over the last decade, agencies have kept up with emerging technologies by snapping up companies with expertise in digitial, social and mobile. But Kimberly-Clark Chief Marketing Officer Clive Sirkin has said the industry is changing too fast to keep pace by buying things. Instead, he suggested an Uber-like approach: managing the traffic without owning the ride, or in the case of agencies, owning the relationship with a client, the strategy and data without owning the execution. Though Mr. Sirkin, himself a former Leo Burnett executive, said he doesn’t want to tell the agency holding companies how to run their business, if he were running one, he would ask: “What’s the Uber look for us?”
Keith Weed, Unilever’s chief marketing and communications officer, and Mondelez CMO Dana Anderson at Cannes almost simultaneously sang the praises of Uber and similarly asset-light Airbnb (renting but not owning housing), Alibaba (the huge Chinese e-commerce player that mostly aggregates smaller retailers) and Facebook, a huge media company that doesn’t own much of the content it publishes.
But what exactly does that mean? After all, plenty of major marketers seem to be moving in the exact opposite direction of a decentralized service model or something as disruptive as Uber and Lyft are supposed to be.
Mr. Sirkin may not want to tell agencies their business, but it’s clear the clamor from marketers like K-C, Unilever and Mondelez for simplicity is getting louder. “What we’re doing from an agency standpoint is consolidating the long tail,” Procter & Gamble Global Brand Officer Marc Pritchard said in a panel discussion in Cannes. “And it’s not just agencies, but related vendors.”
Less than 20 minutes later from a different Cannes stage, Mr. Weed said fragmentation is “pulling our brands apart.” He said “the time when we went to one agency to really manage the whole brand needs to come back in some shape or form.”
It’s more than just talk. RSW/US, a Cincinnati-based consulting firm, found in a survey of marketers earlier this year that 59% have moved in the past year to consolidate agencies and 63% expect that trend to continue.
For Mr. Weed, the Uber analogy was more a segue into his company’s effort to find marketing-tech startups through its Foundry unit and vet them through pilot projects with its brands. Picture hundreds of marketing-tech startups circling the city as the Foundry dispatches them where they’re most needed. So far, it’s reviewed 3,000 such startups in its first year, bringing the 50 or so it found most promising to Cannes for other marketers to check out as well.
More broadly, Uber-esque approaches to content kept cropping up elsewhere at Cannes in the form of content partnerships that let marketers or agencies tap a broader pool of creators. Unilever announced a partnership with Vice to create content through its Broadly women’s channel; WPP joined the Daily Mail and Snapchat to launch the Truffle Pig content agency; and Pinterest announced it has paired with Vice to create content for Bank of America, among others.
“The broader trend is that marketers are looking to cut their spending, and whatever means make sense for an individual marketer is how they’ll approach it,” said Pivotal Research analyst Brian Wieser.
And for some marketers, cutting through the complexity means cutting shops.
Few marketers have gone so far as to rebundle media and creative, but even on that front Coca-Cola Co. will use creative shop Ogilvy & Mather for some media duties following a review that gave most work to UM. Consolidation within media assignments is on the agenda in P&G’s current North American media review, which could roll three current geographic assignments into one and bundle communications planning and search optimization with media buying.
Even with P&G still in the early stages of its “Agency Rationalization” project for creative shops, the recent consolidation of Venus, Braun and other grooming work with WPP’s Grey was the latest in a series of moves that have left few P&G brands with separate digital AOR assignments alongside the general agency of record.
Publicis Groupe’s DigitasLBi, once sprinkled liberally throughout the P&G brand roster, no longer does any work for the company, CEO Tony Weisman said.
But the push for marketer simplicity has also benefited DigitasLBi, which in 2013 won the general AOR assignment for Whirlpool Corp. including all creative plus retail and event for brands that include Whirpool and Maytag. Having fewer agencies allows Whirlpool to “maintain focus, drill deep into our business and drive better integration across disciplines,” said VP-Marketing Bill Beck. “It enables us to most effectively optimize our media spend, staffing resources and travel costs. It just makes sense for us.”
By Jeff Neff