If today’s Brand/Agency relationships started on a dating site, it would be Tinder, not OKCupid. Whereas brands once signed an agency of record for decades at a time, that sort of loyalty is going extinct. According to the Bedford Group, “Client/Agency tenure has shrunk from more than seven years to less than three years.” Industry strategist Avi Dan states, “More than half of agency reviews backfire within a few years.”

2. Can Brands and Agencies Ever
Re-Capture that Old Magic?
0
1
2
3
4
5
6
7
8
1980s 2017
Average Client/Agency Tenure (Years)*
*The Bedford Group: Client/Agency Relationship Sustainability
“More than half of agency
reviews backfire within a
few years.”
- Avi Dan, Industry Strategist

3. If today’s Brand/Agency relationships
started on a dating site…
it would be not

4. The Current Model is Bad for
Everyone
The average Brand/Agency relationship has shrunk to less
than half of what it was.
AGENCY-SIDE CHALLENGE
Massive resource investment needed
to acquire a new customer can no
longer be offset by a stable long-
term relationship
BRAND-SIDE CHALLENGE
High associated costs and
logistical/communications
headaches associated with
constantly onboarding new agencies

5. Why is this Happening?
It’s Noisy as Hell Out There
*Quora: “How Many Ad Agencies Are In the US?”
+120,000 agencies in the US
500,000+ in the world*
+4,000 marketing
technology vendors

6. Why is this Happening?
The Ship of Theseus
*Nobscot Corp
It raises an interesting question:
“If you sign with an agency, and all
the talent at that agency is
replaced in three years, is it still
the same agency?”An agency that churns 20% of its creative
talent each year would essentially be an
entirely new firm every 5 years
Internal Talent Turnover at Agencies is Sky-High
Ad Agency/PR turnover can be as high as 55%,
annually, with an average churn of 15-30%*

7. What are the Implications for
the Future of Marketing?
*Clutch 2016 Study
“When you rise high enough in the
marketing world, you become a
politician.”
- Global Agency Creative Director
With agency tenure shrinking, politics and inter-
agency bureaucracy have become the priority.
Internal communication has become the #1
pain point in brand/agency relationships*

8. How many people get involved in marketing
because they love dealing with corporate
politics and bureaucracy?
*Seriously, ask anybody!
None.*

9. Why do agencies require a
retainer?
Does it have to be this way?
Does the Traditional Relationship
Model Still Make Sense?

10. Is the contract/retainer model
trapping everyone in a
perpetual, dysfunctional loop?
Does the Traditional Relationship
Model Still Make Sense?

11. Person who does
the actual work
Vendor 1
+ Margin
Vendor 2
+ Margin
Agency
+ Margin
Final cost to
Brand
+1 communications hurdle
+1 communications hurdle
+1 communications hurdle
+1 communications hurdle
Agencies that don’t in-house & retain talent add
cost and logistical hurdles to the process
Does the Traditional Relationship
Model Still Make Sense?

12. What’s the Alternative?
There is an opportunity for smaller
agencies to disrupt the standard
business model.
Streamline on-boarding process, eliminate
upfront retainer fees
Change from hourly retainer to “on-demand”
services model
Prioritize in-housing and retaining talent
Reduce up-front financial risk to brand
Lower guaranteed ROI from individual brands,
offset with expanded client pool and lower cost
per acquisition
Reduce communications hurdles and costs by
eliminating hidden margins in the vendor food
chain

13. What’s the Alternative?
The market is already trending
in this direction:
2/3rds of CMO’s prefer agencies with 50 or fewer
staff members because they want:
“Fewer hoops to jump through, more
consistency in account teams, and
more intimate partnership,
regardless of budget.”*
*Horn Group and Kelton Research: “What CMO’s Want in an Agency”

14. What’s the Alternative?
New model to redefine
the brand/agency
relationship
Powerful but unwieldy Nimble but unreliable
Freelancer NetworksTraditional Large Agency

15. Without the up-front risk of
retainer fees, or the uncertainty
of high creative-turnover, we
just might be able to
get agency/brand relationships
back to the sort of loyal, life-
long love-affairs of old.

16. Thank You
info@creativedigitalagency.com
(415) 534-8639