Multiple, Specialized Agencies — Fad or Future?

August 29, 2014

Years ago the agency model shifted, which led to the unbundling of creative and media in order to grow client rosters and revenue streams. Side-effects of this change included silos, increased overhead, and mixed messages back to the client.

When asked how many agencies their marketing department works with, the majority (58 percent) of Marketing2020 respondents indicated one to five, while 19 percent noted six to 10 agencies, which included media, creative, market research, and marketing consultancy firms. Just over half believe that the overall number of agencies they work with will remain the same over the course of the next five years, while 24 percent believe it will increase and 22 percent believe it will decrease.

In-house agencies appear to be on the rise, but as marketing continues to become more technical — and media progressively fragmented — there is an increasing need for specialization. As a result, marketers are starting to employ multiple agencies to handle focused aspects of their business. Fifty-two percent of marketers anticipate working mostly with smaller, specialized agencies for their creative needs in the next five years. Conversely, when it comes to media, 48 percent of marketers will look to global, general agencies to handle a wide range of services.

The bottom line is that brands are once again starting to rethink the traditional agency-of-record model. By pulling from a roster of agencies that specialize in distinct areas, brands see a big opportunity to increase transparency and maximize agency capabilities.