The Media Agency Shift
Tempe-Pinion Newswire – When you think of successful traditional marketing agencies, what comes to mind? Is it the notorious Don Draper sipping whiskey and spewing out ideas, or a one-stop-shop you come to solve all your marketing woes? Regardless of what it is, Genius Monkey thinks that the image and reality of the agency role is in the middle of a paradigm shift.
Looking back 20 – 25 years ago, you simply could not get your commercial on TV, your ad on a billboard, or mailers sent out to your audience without going through an advertising agency. The Media agency business was at its height and had its hand in every advertising medium there was. They were the end-all-be-all for anything you needed in marketing and there really was no other option. Today, however, that structure is in the middle of a dramatic shift.
Fast forward to 2023 where 82% of marketers have transitioned to in-house agencies; this is up from 78% in 2018 and 58% in 2013. The dramatic rise of the IHA model in recent years is a game-changer that’s redefining the marketing landscape, and we’ve got the inside scoop.
The Covid Effect
The pandemic that shook people worldwide continues to revolutionize the business world. In this case, it can be seen as a step in the right direction. Covid drove companies to streamline processes, cut budgets and otherwise increase efficiency in all aspects of their business. For most businesses that meant cutting out as many middlemen as possible and bringing processes in house. This was no different for marketing departments and advertisers. Right or wrong, there was a mass exodus of advertisers leaving agencies to bring those roles in house to slim down expenses. Companies began hiring “industry experts” in individual marketing fields so they could get the expertise they needed internally that an agency would normally bring to the table.
The Result
While bringing items in house and eliminating middlemen sounds great on paper, it is easier
said than done. Many companies’ internal teams – which were already understaffed and overworked – quickly began getting overburdened by the immense workload. Previous agencies that had Google experts, GRP buying teams, social media departments and more were now being replaced by teams of 2-5 people, often lacking the expertise needed on certain platforms or ways of buying media. This led them to needing more efficient tools and all-in-one platforms that could help them do more with less time.
This led to another paradigm shift in the digital marketing realm of companies and advertisers moving away from self-serve platforms – in which the advertiser builds and maintains campaigns themselves – to fully-managed platforms – in which the ad tech companies build and maintain the campaigns for the advertiser. With this methodology switch, advertisers can remain on 15-20+ DSPs/networks in a fraction of the set up and management time, all while having a much more accessible and digestible all-in-one reporting location. Of course, the largest benefit is the expertise from the support group that advertisers enjoy with a fully managed platform; Genius Monkey data alone shows a 39% better cost per conversion on fully managed over self serve with even better metrics on CPC, CPM and other key data points.
Conclusion – The Fully Managed Platform Shift driven by the Agency Shift
With little-to-no added work on their plate, advertisers are finding increased conversions and strengthened bottom lines through managed platforms. This is not to say agencies should be pushed by the wayside, as they certainly still have their place; a good agency is excellent for finding TV GRP buyers or brand developers, and thus should be kept in mind for such tactics.
Contact:
Travis Champ
Chief Operating Officer
Info@geniusmonkey.com
