• by Joe Mandese  @mp_joemandese, January 28, 2024

Most of us think of big ideas as lightbulb moments, but the reality is they usually start as napkin moments, like the one Jared Belsky and partner Sean Belnick scribbled out in the summer of 2021 to outline a roadmap for a new kind of agency.

Two years later, Belsky got most of it right, except the part about becoming an award-winning agency, which was off by a couple of years -- prematurely.

But when MediaPost got to peak under its roof it didn't take us long to realize why Acadia deserved to be our independent agency of the year, because it demonstrated all three of our core criteria: vision, innovation and industry leadership.

On the surface, Belsky will tell you Acadia's success is due to its obsessive focus on media that performs for its clients, which is true in the same way it's true for other best-in-class performance marketing shops. But it is in the ways that Acadia differs from the others, especially a seemingly contrarian business model requiring clients own their own media accounts -- meaning they have a principal relationship with the media, paying them directly, and not through an agent -- that is part of Acadia's unique selling proposition.

And while it might seem like an almost antithetical agency model, Belsky came upon it after a career spent working for some of the industry's biggest clients and agencies -- most recently as CEO of Dentsu's 360i -- and realizing that it would fix many of the problems plaguing the ad industry, especially the lack of transparency, and media neutrality.

In fact, looking back on many of this year's agency of the year awards winners, several of them, including Kinesso, Omnicom and especially Acadia won because they were addressing one of both of the two biggest problems in modern media-buying -- "information asymmetry" and "misaligned incentives -- identified by the Association of National Advertisers in a series of reports published last year from its massive transparency study.

In many ways, Acadia's models address both of them, especially client account ownership, which removes any possibility of misaligned incentives from the agency, and also puts clients in a more directly symmetrical position relative to any information relevant to it.

Belsky admits it requires some awkward conversations with clients to convince them why they should take on something agencies have historically handled for them, but so far he says Acadia is batting 100%.

“We insist on it,” Belsky explained to MediaPost, adding that at first some clients seem surprised when he tells them he wants them to pay the media directly, but that so far everyone has, including accounts like California Pizza Kitchen, Georgia Pacific, Maggiano’s, European Wax Center and Sky Zone.

“For me, the reason we went with Jared was because we wanted to own our own IP,” says Yogi Jashnani, chief revenue officer of Sky Zone, who said he brought it up when he awarded the account to Acadia.

“He said, ‘Of course, why would you even ask for that?’ He seemed surprised that I even asked,” Jashnani recalls.

That kindred expectation may have been because Jashnani, who previously worked at a number of brands -- both big and small -- ranging from Capital One to Advance Auto Parts, previously worked with Belsky at 360i, so they already knew each other’s shorthand.

For Jashnani, he said the model was a non-starter, because he wouldn’t work with an agency that did not allow its clients to own its own account relationships with the media.

And while direct client payment may seem odd for an industry that began with the 15% commission system, Jashnani says it is the best way for a client to control the intellectual property associated with its media accounts -- including all of the data, transparency, as well as relevance with big media vendors when they need something from them.

Jashnani describes the account ownership model as a “pre-nup,” drawing an analogy to the legal documents some couples agree to before marrying, because all the rights and controls are understood long before a breakup.

Jashnani says he has experienced the loss of access to his account’s media data in previous agency break-ups, and says it’s not something he wants to go through again.

Belsky relates a similar story about another undisclosed client that broke up with its agency and the agency demanded a $1 million ransom to get its account data and control back.

It’s not just the dislocation of the account ownership, but a material loss of time and resources required to restart accounts with the media and -- especially with big digital platforms -- rebuilding the algorithm learnings necessary to optimize their performance.

The truth is that’s the core of the model Belksy founded Acadia on: A 100% focus on media that performs.

Belsky is prone to throwing around concepts like “conversion rate optimization,” which is part of the science behind it, but the bottom line is that Acadia was founded on delivering a 100% return on its clients' media dollars, and direct payment and account ownership are just extensions of that model.

From a transparency point of view, Belsky says it is foolproof, because there is zero chance of direct or even indirect kickbacks to an agency when the client is paying the media directly.

And in terms of other aspects of media transparency -- including the amount of media spending that goes to “working media” vs. various digital ad taxes -- the client at least has the authority to make those calls and request an accurate accounting, because they own the account, as well as the relationship with the media.

Belsky says the model benefits the agency too, because it doesn’t have to maintain any overhead associated with those aspects of managing an account.

“Here’s the funny thing,” he says, adding: “I’m able to charge reasonable rates, because I don’t have to have 37 people in billing ops like I did at 360i. And I don’t have to have a 47-person accounting team or 14 account coordinators to tie my shoes in the morning.”

The account ownership model is a “gift that goes in every direction,” he says, adding: “If agencies can get out of their own desire to control the account and stop obfuscating media spending, everyone wins.”

If -- as the Association of National Advertisers’ 2023 transparency reports suggested -- information asymmetry and misaligned incentives are the biggest issues plaguing the media-buying industry, then the account ownership model Belsky developed for Acadia addresses both of them, by giving clients 100% symmetrical control of their media information while aligning the agency’s incentives to what matters most for its clients: performance.