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Auditing Your Agency's Business Model
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Auditing Your Agency's Business Model

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How to deconstruct your agency's business model to better understand the value you deliver to clients and better position for firm to work for the types of clients you really want.

How to deconstruct your agency's business model to better understand the value you deliver to clients and better position for firm to work for the types of clients you really want.

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  • Hi Stephan:

    Thanks for the comment. I do indeed believe there will be further decoupling even in the digital agency model for a couple of reasons. First, there is definitely a difference in perceived value and skills sets between ideation and execution. And second, as digital agencies continue to morph into 'full service' firms (a strategic mistake, in my view) they will increasing be subject to the same dynamics affecting generalist agencies.

    I appreciate the dialogue!

    Tim
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  • Great deck!

    One question about the digital agency model. Do you think there will be decoupling in that business model since the model tries to cover so many spaces on the board? Or will the trend for specialization continue but ideation and execution will continue to be coupled in these hyper specialized agencies?
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  • 1. Auditing Your Agency’s Business Model Presented by Tim Williams
  • 2. What is the ideal agency structure? By Hello Future www.hellofuture.set
  • 3. How long should a piece of string be?
  • 4. Account Management Creative Production Media Traffic Agency structures today don’t look anything like they used to during the golden age of advertising. Really? Accounting
  • 5. “An agency should be agile, forward thinking and engaged in delivering growth by deploying a wide range of tools and people, a far cry from the sausage-factory it was 10 years ago. We might be making software, content, binding books, or creating theatre. An agency engages itself in a diverse community of creative people, from coders to copywriters. It should be a place where there’s space for marketing judo, where business conventions are outmaneuvered and overthrown.” Robert Harwood-Matthews President, TBWA/Chiat/Day New York From “Marketers Explain ‘What Is An Agency,’” Ad Exchanger
  • 6. ①  The full-service model ②  Unbundling creative and media ③  Further unbundling and specialization; the client as integrator ④  ? A short history of agency models
  • 7. Many agencies are reacting to the new multichannel marketplace by attempting to become a new version of “full service” all over again
  • 8. Media companies as agencies Production companies as agencies Convergence? Consulting firms as agencies Media agencies as creative agencies
  • 9. PR firms as “full-service” agencies Digital agencies as “full-service” agencies Convergence? Convergence -- or -- Divergence? Holding companies as “full-service” agencies
  • 10. “So here we are with traditional agencies struggling to become digital agencies and digital agencies struggling to become traditional agencies. It just another big convergence mess and the losers for now are the clients. On both sides you have partially constructed solutions: brands suffer from traditional agencies that are renovated with a digital coat of paint but doing what they've always done, and from digital agencies with incomplete organizations and inexperienced traditional skills.” Tony Quinn Chairman, Society of Digital Agencies From “Marketers Explain ‘What Is An Agency,’” Ad Exchanger
  • 11. “I wish that the agencies would stick to what they are good at. They try to do everything, and they would be better served to narrow their focus. You can’t do everything, and if you try to do everything, you do nothing. It drives me crazy when the agency is trying to pitch you every single service available.” What clients think
  • 12. The three approaches marketers use to work with agencies
  • 13. 1. Best-of-Breed Model Client Models marketers use to work with agencies
  • 14. 1. Best-of-Breed Model Models marketers use to work with agencies
  • 15. 1. Best-of-Breed Model Models marketers use to work with agencies
  • 16. 1. Best-of-Breed Model Models marketers use to work with agencies
  • 17. 1. Best-of-Breed Model Models marketers use to work with agencies
  • 18. 2. Single Source Model Client Models marketers use to work with agencies Agency
  • 19. 2. Single Source Model Models marketers use to work with agencies
  • 20. 3. Service Integrator Model Client Models marketers use to work with agencies Lead Agency
  • 21. 3. Service Integrator Model Models marketers use to work with agencies
  • 22. 3. Service Integrator Model Brand Agency Leader Models marketers use to work with agencies
  • 23. 3. Service Integrator Model Models marketers use to work with agencies
  • 24. 3. Service Integrator Model Models marketers use to work with agencies
  • 25. Best-of Breed Model Single Source Model Larger client companies National/global appeal Smaller client companies Local/regional appeal
  • 26. Best-of-Breed Model Best-of-Breed Model
  • 27. Clients you work with in this model (mostly) Clients you work with in this model (mostly) Best-of-Breed Model Single Source Model Clients you work with in this model (mostly) Service Integrator Model How do clients access your services?
  • 28. The four dimensions of agency business models
  • 29. Four dimensions of agency business models The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 30. “Traditional” Creative Agency The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 31. Creative Agency
  • 32. “Traditional” Public Relations Firm The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 33. Public Relations Firm
  • 34. Public Relations Firm
  • 35. Public Relations Firm
  • 36. Design Firm The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 37. Design Firm
  • 38. Design Firm
  • 39. “Traditional” Media Agency The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 40. Media Agency
  • 41. Brand Development and Business Strategy Firm The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 42. Brand Development and Business Strategy Firm
  • 43. Brand Development and Business Strategy Firm
  • 44. Agency Trading Desk The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 45. Agency Trading Desk
  • 46. Agency Trading Desk
  • 47. Production Agency The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 48. Production Agency
  • 49. Production Agency
  • 50. Production Agency
  • 51. Experiential Marketing Agency The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 52. Experiential Marketing Agency
  • 53. Experiential Marketing Agency
  • 54. Digital Agency The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 55. Digital Agency
  • 56. Digital Agency
  • 57. Experience Design Firm The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 58. Experience Design Firm
  • 59. Experience Design Firm
  • 60. Analytics Firm The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 61. Product Development Firm The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 62. Incubators and Venture Capital Firms The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution
  • 63. The Product The Brand The Purchase The Experience Paid Earned Owned Content Channel Ideation Execution Which dimensions are most common in your model?
  • 64. Client % of income related to PRODUCT % of income related to BRAND % of income related to MARKETING 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. All other clients Where do you play on the value chain? % of income related to EXPERIENCE
  • 65. Client % of income related to PAID % of income related to EARNED % of income related to OWNED 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. All other clients What classes of media do you utilize?
  • 66. Client % of income related to CONTENT % of income related to CHANNELS 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. All other clients Are you focused on content or channels?
  • 67. Client % of income related to IDEATION % of income related to EXECUTION 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. All other clients Are you about ideation or execution?
  • 68. SINGLE SOURCE BEST OF BREED SERVICE INTEGRATOR 2. What media classes you utilize PAID EARNED OWNED 3. Focused on content or channel CONTENT CHANNEL 4. About ideation or execution IDEATION EXECUTION 5. Where you play on the value chain PRODUCT BRAND 1. How clients access your services MARKETING Mapping your current business model EXPERIENCE
  • 69. “If we don’t kill our old business models, someone else will. But if we are ruthlessly curious, learn relentlessly, and fail harder, we get to reinvent the business of persuasive communication for the connected age.” Renny Gleeson Weiden+Kennedy
  • 70. www.IgnitionGroup.com Propulsion Blog www.IgnitionPropulsion.com @TimWilliamsICC @IgnitionGroup www.linkedin.com/in/TimWilliamsICG “Positioning for Professionals” by Tim Williams