The recent chatter about the demise of KSL Media and the notion that small to midsize independent media agencies will have a tough time surviving misses the point: One we should all be well aware
of by now. Size is not, and will never be, the reason why a media agency survives or dies. In fact, as media and media planning and buying have evolved, I would suggest that the industry
now favors the smaller independent shop.
The tables are turning as clients realize that media planning and buying is not a commodity, but rather an instrumental and important component
of their overall marketing strategy. Media agencies have become strategic intellectual hubs with accountability and business results at the center of our efforts.
The media world
is breaking down the barriers of scale every day; auction marketplaces, programmable systems, data analytics. These resources have leveled the playing field so that any company can
compete. The only true advantage size offers right now is in Network TV, but even that antiquated process of negotiations won’t last for long.
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From the group buying power
perspective, the industry has moved away from wanting the "cheapest media" to wanting the best return on investment. With that said, cost is a major variable in the return equation. In the
increasing world of programmatic buying, clout isn't a factor. Ads are sold to the highest bidder regardless of agency size. Vendor relationships are made at any agency and favorable deals
are struck every day without regard to agency size.
Another way to look at it is that you might think you are going to get the lowest prices at Walmart, but do you want to shop there
exclusively? You give up variety, service, shopper experience, and, often times, quality. With small to midsize media agencies, a client’s experience is tailored to their individual
needs, not the needs of the masses.
Smart clients understand the value of innovative, accountable, and dedicated media teams. They appreciate those that build value, not by scale
and scale alone, but by their ability to develop custom solutions that offer both innovation and efficiency.
The client benefits of a small to midsize media agency are many. As
strategic intellectual hubs, they:
- Eliminate large agency bureaucracy and process and can meet client demands quickly. This translates into a culture of "Yes" as opposed to
a culture of "let-me-talk-to-10-people-and-get-back-to-you".
- Innovate and act/react quickly to the changing media landscape. There are no barriers and speed bumps to fast forward
thinking. An example of this is with streaming radio and internet TV. Our agency fully embraced these new channels and at the birth of Pandora, we were one of the platform’s largest
media investors.
- Evaluate multiple analytics solutions and recommend ones that are best suited to individual client’s needs. Large agencies must often sell their in-house
solutions as best-in-class regardless of whether or not it is the right fit for the client.
A focus on innovation and creative client solutions will make smaller independent
media agencies stronger and keep us in business for a long time to come. If an agency dissolves, it’s because they have not managed to make the transition into a strategic intellectual hub
or they have not managed their bottom line properly – it is definitely not because of their size.