Auditing Your Agency’s
Business Model
Presented by
Tim Williams

What is the ideal
agency structure?
By Hello Future www.hellofuture.set

How long should a
piece of string be?

Account
Management
Creative
Production
Media
Traffic
Agency structures today don’t look
anything like they used to during
the golden age of advertising.
Really?
Accounting

“An agency should be agile, forward thinking
and engaged in delivering growth by deploying
a wide range of tools and people, a far cry from
the sausage-factory it was 10 years ago. We
might be making software, content, binding
books, or creating theatre.
An agency engages itself in a diverse community
of creative people, from coders to copywriters.
It should be a place where there’s space for
marketing judo, where business conventions are
outmaneuvered and overthrown.”
Robert Harwood-Matthews
President, TBWA/Chiat/Day New York
From “Marketers Explain ‘What Is An Agency,’” Ad Exchanger

① The full-service model
② Unbundling creative and media
③ Further unbundling and specialization;
the client as integrator
④ ?
A short history of agency models

Many agencies are reacting to the new multichannel marketplace by
attempting to become a new version of “full service” all over again

Media companies as agencies
Production companies as agencies
Convergence?
Consulting firms as agencies
Media agencies as creative agencies

PR firms as “full-service” agencies
Digital agencies as “full-service” agencies
Convergence?
Convergence
-- or --
Divergence?
Holding companies as “full-service” agencies

“So here we are with traditional agencies struggling
to become digital agencies and digital agencies
struggling to become traditional agencies.
It just another big convergence mess and the losers
for now are the clients. On both sides you have
partially constructed solutions: brands suffer from
traditional agencies that are renovated with a digital
coat of paint but doing what they've always done,
and from digital agencies with incomplete
organizations and inexperienced traditional skills.”
Tony Quinn
Chairman, Society of Digital Agencies
From “Marketers Explain ‘What Is An Agency,’” Ad Exchanger

“I wish that the agencies would stick to
what they are good at. They try to do
everything, and they would be better
served to narrow their focus.
You can’t do everything, and if you try to do
everything, you do nothing. It drives me
crazy when the agency is trying to pitch you
every single service available.”
What clients think

The three approaches
marketers use to work with agencies

1.
Best-of-Breed Model
Client
Models marketers use
to work with agencies

1.
Best-of-Breed Model
Models marketers use
to work with agencies

1.
Best-of-Breed Model
Models marketers use
to work with agencies

1.
Best-of-Breed Model
Models marketers use
to work with agencies

1.
Best-of-Breed Model
Models marketers use
to work with agencies

2.
Single Source Model
Client
Models marketers use
to work with agencies
Agency

2.
Single Source Model
Models marketers use
to work with agencies

3.
Service Integrator Model
Client
Models marketers use
to work with agencies
Lead Agency

3.
Service Integrator Model
Models marketers use
to work with agencies

3.
Service Integrator Model
Brand Agency Leader
Models marketers use
to work with agencies

3.
Service Integrator Model
Models marketers use
to work with agencies

3.
Service Integrator Model
Models marketers use
to work with agencies

Best-of Breed Model
Single Source Model
Larger client companies
National/global appeal
Smaller client companies
Local/regional appeal

Best-of-Breed Model
Best-of-Breed Model

Clients you work with
in this model (mostly)
Clients you work with
in this model (mostly)
Best-of-Breed
Model
Single Source
Model
Clients you work with
in this model (mostly)
Service Integrator
Model
How do clients access your services?

The four dimensions
of agency business models

Four dimensions of agency business models
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

“Traditional” Creative Agency
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Creative Agency

“Traditional” Public Relations Firm
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Public Relations Firm

Public Relations Firm

Public Relations Firm

Design Firm
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Design Firm

Design Firm

“Traditional” Media Agency
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Media Agency

Brand Development and Business Strategy Firm
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Brand Development and Business Strategy Firm

Brand Development and Business Strategy Firm

Agency Trading Desk
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Agency Trading Desk

Agency Trading Desk

Production Agency
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Production Agency

Production Agency

Production Agency

Experiential Marketing Agency
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Experiential Marketing Agency

Experiential Marketing Agency

Digital Agency
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Digital Agency

Digital Agency

Experience Design Firm
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Experience Design Firm

Experience Design Firm

Analytics Firm
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Product Development Firm
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

Incubators and Venture Capital Firms
The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution

The
Product
The Brand
The
Purchase
The
Experience
Paid
Earned
Owned
Content
Channel
Ideation
Execution
Which dimensions are most common in your model?

Client
% of income
related to
PRODUCT
% of income
related to
BRAND
% of income
related to
MARKETING
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
All other clients
Where do you play on the value chain?
% of income
related to
EXPERIENCE

Client
% of income
related to
PAID
% of income
related to
EARNED
% of income
related to
OWNED
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
All other clients
What classes of media do you utilize?

Client
% of income related to
CONTENT
% of income related to
CHANNELS
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
All other clients
Are you focused on content or channels?

Client
% of income related to
IDEATION
% of income related to
EXECUTION
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
All other clients
Are you about ideation or execution?

SINGLE
SOURCE
BEST OF
BREED
SERVICE
INTEGRATOR
2. What media classes you utilize
PAID
EARNED
OWNED
3. Focused on content or channel
CONTENT
CHANNEL
4. About ideation or execution
IDEATION
EXECUTION
5. Where you play on the value chain
PRODUCT
BRAND
1. How clients access your services
MARKETING
Mapping your current business model
EXPERIENCE

“If we don’t kill our old
business models, someone else
will. But if we are ruthlessly
curious, learn relentlessly, and
fail harder, we get to reinvent
the business of persuasive
communication for the
connected age.”
Renny Gleeson
Weiden+Kennedy

www.IgnitionGroup.com
Propulsion Blog
www.IgnitionPropulsion.com
@TimWilliamsICC
@IgnitionGroup
www.linkedin.com/in/TimWilliamsICG
“Positioning for Professionals” by Tim Williams