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Global or local? Network or Independent? Choosing an advertising agency relationship

Advertising agency relationship

This post is by Jeremy Taylor, Business Director at TrinityP3 UK and Managing Partner of CONNECT2 Community Engagement Ltd, the UK’s leading community engagement experts.

We’ve noticed a distinct recent trend in global markets for advertisers to request, consider and appoint local independent agencies, rather than going for the big networks. Good news for the local agencies, but we wondered what is behind the shift.

Every advertising agency usually claims that it would prefer to be judged by the standards of its work, either through its creative impact or by its effectiveness. However, quite clearly there are other selection criteria for clients. Here is a quick look at the headline benefits of working with the two types of agency, to help you along the decision process.

GLOBAL NETWORK AGENCIES

LOCAL AGENCIES

Global talent pool – international networks tend to have in-depth resources to call on, which can provide in-depth resources for creative and also specialist skills unavailable locally.

24-hour working day – offices around the world can mean that work can continue on a brief full time for a fast response and turnaround.

Parent company pressure to improve – network agencies have owners and shareholders to answer to, which helps to maintain a focus on continual improvement of service levels and skillsets (As well as the more prosaic standards of time efficiency and profit margin)

A global view on the brief – A network of offices allows country-specific agencies to call on colleagues for international trends and developments that can broaden the response to client briefs.

Diverse Culture – many agency-networks practice staff exchange and career development programs, which give rapid access to learnings from other markets.

Global consistency – with a centralised client management team, a network agency can provide consistent brand work across multiple markets without the need for client teams to micro-manage.

Cost-effective delivery solutions – big agency networks are able to invest in expensive solution delivery systems, including production. Costs are spread among many clients rather than needing to be loaded onto only one.

Data and insights – global networks are increasingly investing in world-class data systems, giving access to global customer insight and market intelligence

Breadth of offer – big networks have access to a full range of skills and services that they can bring to bear for clients as needed, with no call for further procurement issues.

Broad experience – a big network means broader and deeper experience to call on across a larger client base. There’s less chance of them being blind-sided by a brief for which they have no experience to call on.

Global negotiating power – Network agencies bring their considerable buying power to negotiations with similarly sized global suppliers in production, media, sponsorships, and more.

Management focuses on existing clients – with new business being handled centrally by a global new business team, this can mean that individual agency management teams are able to spend more of their time dealing with existing client needs. (Although, of course, dealing with global shareholders also takes management time).

Flexibility – Local agencies tend to be smaller, with smaller management teams able to make quick decisions. This should lead them to be able to work with greater agility and speed on client business.

Adaptability – with a less vested interest in pre-determined solutions, the independent local agency can be more focused on the specific requirements of the brief rather than having to sell an existing solution or platform.

Affordability – no shareholder margin to pay and less investment in management costs are often reflected in agency fees.

No complacency – smaller and local agencies usually have fewer laurels to rest on. Every brief is a chance to develop a reputation and gets corresponding attention. A big win is never ‘just another client’.

Only the services you want – the independent local agency is under less pressure to sell its clients the whole range of services it offers, so it can concentrate more on what the client needs rather than what the agency would like to sell.

Bureaucracy absence – an owner-management team has more freedom to manage the day-to-day business and take instant decisions.

Transparency – small companies tend to be more transparent in their business dealings. This potentially makes it easier to procure and deal with day-to-day.

A local centre of excellence – there are ways and means of using a local agency to develop central creative concepts, which are then implemented globally by the best and most cost-effective process – e.g. ‘trans-creation’ and production specialists. So, nothing to stop you from buying the best global creative solution from a local agency and maybe investing a little in multi-market implementation.

Management Stability – Independent agencies often have the founder and the owners managing the agency from day one. This brings the benefits of very stable management and often reflects in a low turnover of staff.

No Hidden Network Fees – independent agencies do not have networks of offices and staff to support and therefore are not required to pay fees to support the same.

Focus on results – in the independent sector, new start-ups are often looking to build a reputation and attract new clients. To achieve this, they look to maximise the effectiveness of the work with existing clients to make themselves famous (for the right reasons).

 

Plenty of pros and cons to consider. But the answer always comes down to what best suits your current and future needs.

As a final thought, if you want to pick an agency purely on the basis of their ability to tell their own brand story, then you shouldn’t be surprised if you struggle.

TrinityP3 spends a lot of time and energy looking for differentiation in agency credentials presentations, but when it comes down to it “You can count the number of agencies with their own brand equity on one hand, and those that do tend to be independents”. No, we didn’t say that – it’s a published quote from the global marketing director of one of the agency networks.

TrinityP3’s comprehensive Search & Selection process provides extensive market knowledge, tightly defined process and detailed evaluation and assessment. Find out more

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Jeremy Taylor is Managing Partner of CONNECT2 Community Engagement Ltd based in London, the UK’s leading community engagement experts and Business Director at TrinityP3 UK. He brings his wealth of industry experience to TrinityP3 to help our clients and agencies navigate the constantly evolving world of marketing, media and advertising.

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