"He who has the gold, makes the rules." or so says the (revised) Golden Rule, and that couldn't be more accurate for the agency space. Massive clients like P&G who spend billions of dollars on advertising each year (P&G spent $7.1 billion in 2017) tend to dictate how agencies (and agency holding companies) position themselves in the marketplace. That positioning; a balance between creative diversity and managerial complexity swings back and forth like a pendulum every 10 years or so, and the pendulum is on its way back toward the all-in-one AOR model again.
As our very unscientific, but experience-driven graphic shows, the desire for more/better creative options drives the client to "augment" their Agency of Record with Specialist Agencies (think an interactive agency or a direct marketing agency) with the idea that the AOR will play a lead role and the Specialist Agencies can augment those capabilities where the AOR isn't quite "Best of Breed".
Yeah... That doesn't work. That never worked. Agencies are too hyper-competitive to peacefully co-exist for very long. The AOR ends up feeling like a beached whale with hyenas constantly biting at it. So the client discovers that they have to step in to keep the peace, more and more. Managerial complexity rises, but they figure the solve is to just bust the whole thing up, eliminate the AOR lead role and have some kind of Knights of the Round Table arrangement where everyone sticks to what they do best and everyone gets along.
Except that doesn't work either...
The marketing becomes schizophrenic, with every agency's creative team "interpreting" the idea in their own way and the brand taking a massive bashing on the nose for it. The client comes under fire from management for the amount of time they're spending managing their agencies and the brand experience and messaging across channels is a chaotic mess.
Something's gotta give...
Thus the retreat starts. The client begins to yearn for the days when they had one key agency contact instead of forty. They long for the days when they saw one concept executed across multiple channels. Sure, maybe the innovation in each of those channels wasn't the best. And maybe they only saw three concepts instead of twenty, but the whole thing was just so much easier with one agency.
And thus the return to the AOR...
What does that mean for you?
As the pendulum swings back toward an all-in-one AOR solution, you need to ensure your agency is as prepared as possible for that eventuality. Many agencies today don't have a Media capability. That's a problem if you're hoping to be a one-stop-shop for your clients. Some agencies can't provide CRM services, or integrated reporting and analytics for their clients; that's a problem.
Get ahead of the problem with an integrated agency management solution like Advantage's AQUA software. You'll have full Media Planning and Buying capabilities combined with comprehensive (and Agile!) Project Management functionality fully integrated with every Accounting functionality you could ever want.
Get the system. Be the AOR. Own the future.
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