Simplification, Dedication Spur Single-Client Agency Approach

The growing complexity of marketing, increasing demands for efficiency, and clients’ desire to employ the best talent all lead to the spreading tactics of one-company conversations.

Single-client agencies have been back in the news this year, with moves from all the big agency holding groups.

In May, WPP, the pioneer of what it calls the “Team” model of client service, rebranded its Team Detroit, Blue Hive, and Retail First operations, which have been working for Ford for nine years, as Global Team Blue.

In August, Omnicom won the pitch for McDonald’s creative account in the U.S. and began setting up a dedicated full-service agency for the fast-food giant. The result, We Are Unlimited, was unveiled last month.

And, throughout the year, Publicis has been reorganising itself to be what it describes as a “connecting company,” aiming to bring talent from across its network of agencies to solve client problems.

So what’s driving this flurry of activity?

Life Is Complicated

The first issue is the growing complexity of marketing itself.

“There are a lot more moving parts for marketers to deal with today,” explained Paul Phillips, managing director of client/agency intermediary service at AAR. “Life is a lot more complicated, so opportunities to clarify will be of interest to the marketing community.

“Life is also more complicated for CMOs in areas that are non-agency-facing, so it makes sense to optimise to one-company conversations, rather than multi-company conversations.”

Debbie Morrison, director of consultancy & best practice at ISBA, the representative body for U.K. advertisers, agrees that many larger clients are looking to simplify their agency relationships.

“With every new channel, you’re probably bolting on a new agency, so clients are spending all their time managing their roster,” she said. “There’s a quest for greater integration and simplicity.”

The second issue is efficiency.

“Marketers are under constant pressure to reduce costs, often driven by procurement departments having a louder voice,” said Peter Sherman, executive vice-president of Omnicom group. “Therefore, solutions that deliver efficiency become important.

“There’s also more and more pressure placed on impact, which comes out of the need to deliver on ROI, and the fact that ROI can be tracked more closely than ever before. Then convergence means marketers—and agencies—are not able to work in silos any longer. We no longer have the luxury of thinking in a linear, waterfall way. We have to deliver the impact I’m talking about in a very connected fashion. Add all that up, and it leads to one-stop-type working.”

Bring Me That Horizontality

Sir Martin Sorrell, founder and CEO of WPP, sees the drive to what he calls “horizontality” as coming from clients’ desire to employ the best talent.

“When clients choose the “horizontal” WPP Team model, it’s usually because it allows them to reach the best talent wherever it sits within the group. There is a single point of access in the form of a client leader, it seamlessly integrates the various marketing services disciplines—from creative and media to social and data—and it unlocks the benefits of WPP’s scale,” he told CMO.com. “Simply, they want the best people in the business; they’re not interested in which of our verticals —the individual agencies and networks—they come from.”

This desire among clients for the best agency talent is also partly behind Publicis’ reorganisation. Rishad Tobaccowala, strategy & growth officer at Publicis, described the strategy arising from the concept of the connecting company.

“The holding company is cross-selling; the connecting company solves client problems using our assets and theirs. Whatever the problem, the assets are delivered no matter whether you’ve hired that agency. You’ll get the capabilities without having to go to the CEO of the specialist agency.”

Tobaccowala explained that this was one of the pillars of Publicis’ new structure, that each major client has a group client leader responsible for their account. But he also stressed the key role of the individual agency brands.

“The real power continues to be at the brand level; the centre supports the brands,” he said. “In effect, we’ve allowed ourselves to be easier to deal with.”

Omnicom’s Sherman also emphasised the continuing importance of individual agencies to the group.

“Strong independent agency relationships are more relevant than ever,” he said. “Agency brands and their culture are the reason we can attract and retain the best talent.

“I think we sometimes get confused with the structure being more important than the talent. There are a lot of different ways to deliver talent, but the delivery is not as important as the components.”

Cultural Issues

The issue of the relationship between talent and agency culture is one raised by people outside the big holding groups as a potential stumbling block for single-client agencies. AAR’s Phillips suggested that taking staff out of the agency culture they’d bought into could lead to problems with retention and recruitment. And Morrison at ISBA said she thought talent could become stale working on a single account, without the stimulus of other clients.

But Sir Martin Sorrell dismissed the idea.

“Fifty global clients, 40,000 WPP people, and $6.5 billion of revenue say that argument doesn’t stack up. WPP’s global client teams have a track record over more than 10 years of delivering highly creative, highly effective campaigns.

“It’s more of a problem for in-house agencies, which rarely last as they struggle to keep the best people and don’t have the ability to refresh their talent from a large pool.”

Analytics At The Core

Another increasingly important element of all the holding companies’ approaches is the need to integrate analytics. Sherman described how Omnicom had built its data and marketing sciences function, Annalect, to underpin its offering.

“We recognise the need for deeply integrated data and analytics,” he said. “Across a lot of our models, we build in a deep and fluid consumer intelligence-understanding engine. We put consumer intelligence at the core, and we primarily deliver that via data and analytics. One of the biggest leaps in the last 10 to 20 years has been in our ability to understand consumers at a far more granular level. Why would we not bring that off the sideline and into the centre of anything we’re building for our clients?”

Similarly, Tobaccowala at Publicis described how the group identified the ability to unify intelligence, creative, and technology as one of the key factors behind today’s most successful businesses.

“Intelligence is making marketing smart, creative is great UI and customer experiences, then you need to unify that with the underlying technology to make it happen. Connecting all of those is what clients want,” he said.

And WPP has built its data and analytics expertise within Kantar, its market research data and insights division, last year, forming a strategic global partnership with comScore as part of its strategy to put digital and data at the heart of the business.

What Does The CMO Want?

Whether or not a company adopts a single-client agency approach will also depend on the attitude of the CMO.

“What’s important is the notion of wedding my business to your business,” Phillips said. “As CMO, I’ve got to emotionally buy into this idea. I might actually like the idea of having different elements from different holding companies keeping each other on their toes.”

Sir Martin agreed that not all clients wanted the same approach.

“Many continue to choose to work with individual agencies and networks, based on their own strong reputations, skills, and capabilities. For the team approach to work well, you have to have a client CEO who has a strong vision and who is the brand guardian, and a CMO who shares that vision and is given the power to implement it.”

And he predicted the space would continue to evolve.

“I don’t think the trend towards clients wanting greater effectiveness and efficiency will go into reverse—quite the opposite. What I do think we’ll see, as others try to follow WPP’s lead, is a realisation that successfully delivering such solutions to multiple clients over long periods of time is not easy.

“It’s a major undertaking that requires total commitment, robust organisation, the ability to deliver what you have promised—and great care. Encouraging greater collaboration across parent groups is a fine balancing act—push agencies down this road too quickly, and they will break.”

Morrison at ISBA highlighted the sense of flux in the sector.

“Twenty years ago, everyone had the same model, but I don’t think there’ll be one way of working ever again,” she said. “The environment will never be static.”