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About 60% of clients are looking to reduce number of agencies on their roster

Nearly three-quarters of major multinationals are reviewing their current agency arrangements as many clients recognise their current roster set up is not working effectively, rating it just 5.7 out of 10. Agencies were even more skeptical about the effectiveness of current roster arrangements, scoring them at just 5.2 out of 10.

According to WFA’s “The Future of Agency Rosters” report created with The Observatory International, these companies looking at whether they have the right mix of agencies and capabilities in their external partners.

Many advertisers use a variety of core models across their operations, underlining the complexities of developing fit-for-purpose roster architectures around the globe.

Nearly 60% of clients said they were looking to reduce the numbers of agencies on their roster over time.

But just over 50% of clientssaid there were seeking to increase the numbers of specialists they use. The current dominant model of agency management is:

  • Multiple agencies managed individually by marketing (81%)
  • Integrated lead agency (44%)
  • Network agency with specialisms from same holding company (39%)

The good news for agencies is that 82% of advertisers do not foresee a world without agencies.

What agencies and clients are unhappy about

In the current ecosystem, agencies feel that clients do not provide them with the right tools to deliver the expected results. Collaboration can be hindered by internal structures (51%), poor quality briefings (49%), approvals and sign off processes (40%), lack of trained client personnel (40%) as well as lack of a clear data strategy (52%). All of which, they argue, undermine the quality of agency work.

Clients agree and nearly 50% recognised that their own internal structures may be an encumbrance to operating the most effective roster model.  However, clients feel that agencies across the ecosystem have some way to go to provide quality delivery.

The biggest areas of concern were ROI measurement across channels, when it comes to informing the whole roster through data, analytics and insights, as well as clearly understanding the end-to-end consumer journey. About 84% of clients believe that agencies are struggling with MarTech – and 71% of agencies agree – underlining the complexities of this area and the reason why management consultants have spotted an opportunity.

“These findings highlight the challenges that each side faces and there’s clearly plenty of improvement that everyone can make. Whatever roster arrangements brands develop, they should ensure that they can deliver on their promises to their agency partners. Without that, no roster model will be able to work effectively,” said Stephan Loerke, CEO at the WFA.

“Clients want their roster to be made up of impartial business partners with real knowledge of their customers. Change will be needed on both sides to turn this vision into reality. True partnership will require increased commitment and transparency from both clients and agencies,” said Lucinda Peniston-Baines, co-founder and managing partner at The Observatory International.

The findings are based on responses from 50 multinational marketers representing a total global ad spend in excess of US$69 billion. There were 26 agency representatives contributing, with more than 50% in global/regional roles spread across the globe.

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