The relationship between brands and agencies is constantly evolving. Add to that a pandemic, seismic disruptions in marketing strategy, as well as urgent digital transformation plans, and this partnership becomes even more complex, adding both stress and opportunity for agencies as they prioritize their own success while meeting and exceeding customer demands.
How has the pandemic affected marketing and advertising agencies?
In 2020, agencies saw declining revenues and struggled to land new business deals, while many in the US received funding from the Paycheck Protection Program (PPP). Still, some agencies have seen the tumultuous nature of the pandemic as an opportunity to guide clients through a crisis. Additionally, the pandemic has accelerated the digital transformation of major brands, and agencies were and remain ready and waiting to help them on this journey.
Why do brands regularly audit their list of agencies?
A major brand subjecting their agency business to scrutiny is common practice. It ensures that the brand gets the best work from its partners and keeps the ecosystem competitive. It also allows the brand to design a template that reflects the current state of marketing and advertising and its business priorities.
What is the state of the boarding school?
The initial threat of brand internalization is no longer as great for agencies as it once was. Still, there are brands that bring standardized capabilities in-house, and some even build their own stores if that’s a core differentiator or value proposition. Agencies are not at risk and see it as another way to guide and support clients in building their team, skills and operating model.
How can agencies better serve their clients in 2021 and beyond?
Agencies should focus on updating and evaluating their offerings to bring in new and innovative ideas, especially as clients change their needs. They must also understand their role when engaged in a multi-agency brand ecosystem and be clear on how to succeed. Finally, agencies need to assess their operating model to balance depth and breadth with agility and scale.
WHAT IS IN THIS REPORT? This report covers the impact of the pandemic on the agency landscape, reviews other challenges facing agencies, such as roster audits and housing, and highlights priority areas for future growth.