Best of the Net - Interactive Agencies

In a year when interactive media billings were finally something that agencies could brag about again - after two years of dismal spending by skittish marketers - the unimaginable happened: they kept quiet. Not by choice mind you, but out of fear.

What's worse? The fear of telling the usual tall-tales of puffed up billings and getting caught and punished, or fear of having to actually tell the truth and exposing years of over-inflated billing claims. Either way, silence was golden, at least in terms of financial information.

So what led to this sudden change of practice - their guilty conscience or maybe a new business angle? No, it was two obscure lawmakers who were responsible. U.S. Sen. Paul Sarbanes (D-MD) and Congressman Michael Oxley (R-OH) who co-authored the now infamous Sarbanes-Oxley Act which requires the officers of public companies to certify that the accounts are accurate and that all processes are in place to ensure that no errors or omissions are made, under stiff penalty By extension, if public holding companies such as Interpublic, WPP, or Omnicom, for example, were to give less than accurate media billing figures, the management of these companies would be held accountable. Hence, a good number of agencies for the first time refused to provide this data.

Although this didn't affect how our editors and advisory panel selected this year's "e" winners, it did have a dramatic impact on our process for ranking the top 50 interactive agencies. Because of the increased government scrutiny and subsequent non-disclosure of billings, we could not accurately determine the exact ranking of this year's 50 highest online media billing agencies, such as we had for the previous two years.

As such, we have listed the top 50 leading interactive agencies for 2003 (alphabetically, to be fair) based on criteria including, new business wins and loses, client list, notable achievements, innovative approaches, expertise of senior management, types of interactive services provided, industry buzz, and when we could get a sneak peak, the billing information too. We think this chart will be as useful as it always has been.

Along with the top 50 agencies, we once again singled out six interactive shops which were the Best of the Net in 2003. Congratulations go out to mOne who is this year's recipient of the Gold "e" Award and runner-up OMD, the winner of the Silver "e" Award. In addition we selected four Bronze "e" Award winners for analytics and research (Avenue A), innovation (Starcom IP), planning (Carat Interactive), and strategy (Universal McCann Interactive).

Their following stories clearly show why these six are truly deserving.

Gold "e" Winner: mOne, by Tobi Elkin
After two consecutive anemic years, the online media business is finally starting to hum again as marketers and their agency partners team up on bold, new programs that can become the linchpins of a client's media plan. In 2003, interactive media strategists and creatives had seats at the big kids' table as never before, leading efforts to quantify the all-important return on investment and accelerate the drive toward cross-media optimization and offering breakthrough media programs that play to the Web's intrinsic strengths.

And perhaps no online media player was more influential in advancing the medium and moving the needle on behalf of its clients and the industry than mOne, the WPP Group company that launched in April 2003. mOne was bred by combining OgilvyOne Media and MindShare Digital to form a truly global powerhouse that integrates media buying and planning operations under one shingle. Nasreen Madhany, the veteran global media director at Ogilvy known for her IBM Corp. account pedigree, is the CEO and Ogilvy senior partner Stuart Bogaty is the managing director of mOne, New York. With 180 employees in 45 offices worldwide, and a bevy of blue-chip clients that include Ameritrade, Cisco Systems, IBM Corp., and Unilever, (the agency declined to provide interactive media billings) mOne snares MEDIA Magazine's Gold "e" Award and top honors as Interactive Agency of the Year.

While mOne is a nascent brand, its foundation has been aging for some time, steeped in a direct marketing heritage via OgilvyOne and a culture of media integration courtesy of MindShare. Beyond its core foundation, in September 2003 mOne introduced an in-house search marketing capability that will enable it to take advantage of spiraling growth in the segment by delivering services ranging from keyword optimization and placement to bid management. Among other accomplishments, mOne developed a cross-media capability to measure digital media's role in the media mix, launched a proprietary reach and frequency system, and offered a frequency capping analysis tool with Atlas DMT. Since the company's launch these systems have resulted in a 10 percent gain in leads and a 15 percent increase in target reach for mOne.

"We continue to improve on our own performance," Bogaty says. mOne also scored solid new business wins in 2003 - Nextel, Bristol Myers Squibb, and Lufthansa, among others - to grow year-over-year revenue by 20 percent in a down year; that number was five percent in 2002.

By marrying the discipline of direct marketing with the Web, mOne believes it stands apart from other agencies. There is also the "dream staff," as the agency's talent is described by Susan Schiekofer, mOne's director of strategic operations and a senior partner. "We took the best people who loved the technology of the Internet and mixed them with the best in direct marketing and they sort of taught each other their best practices." Schiekofer, who grew up in direct marketing, also credits mOne's ability to deliver sophisticated analytics via a seven-person metrics team that measures brand effectiveness, pre- and post-testing, brand attribute testing, and more.

The agency's keen ability to integrate online media and marketing at the head end, rather than as an additive, is another unique characteristic that's part of its DNA. "We are involved at the budget allocation stage...The question is, how do we integrate this medium into the process?" Madhany notes, adding, "When clients come to companies like ours for a 360º solution, the Internet should be looked at at the same time as the rest of the media. It's really critical that the interactive specialists and the broadcast specialists work together."

For Ameritrade, the online brokerage firm, mOne adopted an aggressive use of rich media, using Flash MX to stream a commercial that was specifically created for the Internet and Eyeblaster floating ads. Ameritrade was also the first brokerage to launch a full-screen ad format via Unicast across business and financial websites. mOne's innovative work for the Office of National Drug Control Policy won awards for its unique ability to reach both teens and parents, integrating engaging content and interactive quizzes on a variety of sites.

In IBM, mOne has a client whose business demands uniquely integrated global programs that achieve brand awareness and lead generation. In 2003, mOne focused on brand-awareness-generating programs with the goal of surrounding senior line of business and C-level executives with media demonstrating IBM's e-business on-demand message. As befits a leading-edge technology company, mOne devised a series of engaging new media opportunities, including the first instant messaging sponsorship with Dow Jones & Co.'s Wall Street Journal Online; co-developed a sponsorship of's Executive Connection with downloadable desktop applications; used Captivate's elevator network; and ran a two-screen (TV and Web) program with The History Channel. There were also a number of location-based wireless and custom content Web-based programs.

For Cisco, another mOne client, mOne was tapped to work a minor miracle: The provider of Internet networking gear hadn't advertised in nearly two years when mOne began working with the company in October 2002. In February 2003, Cisco launched a global campaign in eight markets and a drive to raise awareness among business decision makers of Cisco's entry into new product segments. While 90 percent of Cisco's work with mOne focuses on lead generation and registrations, the campaign quickly became a hybrid of awareness-building and lead-generation activity.

"Our relationship is quite new, and I think as we move forward, I would look more toward enhancing the relationship [with mOne] outside the U.S. and sharing learning internally and externally and growing the international teams more," explains George Gutierrez, director of worldwide media operations at Cisco. "One of the key things for us is optimizing the activity as quickly as possible, passing the learning along to each market," he says. Gutierrez credits mOne for creating unique content integration opportunities with, among other key Web publishers. "The white papers and webcasts have been very successful," he says. As further evidence that Cisco is moving in the right direction, Gutierrez points to the latest numbers from a recent brand tracking study of Internet, TV, and print media showing a large increase in awareness of Cisco Internet activity in the U.S.

In 2004, mOne will continue efforts to move Internet media into the overall media planning equation, pair more clients with emerging technology trials, and focus on growing its search marketing and multimedia direct response businesses. And on Madhany's wish list? "I want to take some of the successes from the U.S. market and transport and integrate them with the mOne offerings in other parts of the world.

Silver "e" Winner: OMD Digital, by Lynn Russo
How do you take four media departments from different companies and combine them into a single world-class organization charged with a unified philosophy and planning and buying structure, then get all your traditional agency siblings - which felt they didn't need you before - to accept you, integrate you into the fold, and work with you as an equal? You operate under a corporate mandate that every department is media neutral and that it's all about the client and delivering results, so everyone works together for a common goal. And while you're at it, you financially structure the company in a manner that fosters teamwork.

That's exactly how OMD Digital became a digital media powerhouse in 2003, sending billings skyrocketing by 328 percent, from $70 million to $300 million, and reaping MEDIA Magazine's prestigious Silver "e" Agency of the Year Award. OMD Digital was formed in mid-2002 by combining Omnicom properties Tribal DDB, AtmosphereBBDO, TBWA/Chiat Day, and Rapp Media. The new firm, a division of Omnicom's OMD Worldwide, specializes in strategic planning and buying services for new and emerging media, including search, convergence/multi-platform, wireless, tracking/analytics, email marketing, intranets, and portals. Its 70 employees in five offices handle 30 clients, including Dell, United Airlines, Absolut, GE, and Cingular Wireless.

So how did OMD get all those disparate groups to work together and function as one? The first of the company's many strengths is its people. "We've got the right mix of people who are not out to protect their turf but are all about the client and functioning as a team," says Jeff Minsky, East Coast director, who runs the New York office. "Because the integration directive was top-down and everybody's in the mode to build something special, that to me has been the key to our success this year."

Midwest director Sean Finnegan describes the spirit and culture of the organization as people who can work in the trenches and innovate together and still have the personality and wherewithal to want to socialize together. "They're the kind of people you'd want to be stuck with at an airport during a long delay," he says.

A second strength is OMD's well-oiled planning and buying processes. "There's a lot of stuff out there that is not process-oriented," Minsky says, noting that some companies operate much more loosely than OMD Digital. "We have a really good process for planning and buying; it's written down and we hold people to it."

The agency books $1 million in online media daily, and has multiple upfront agreements in portal placement, rich media, ad serving, over-the-page inventory, and research tools which provide discounts and exclusive opportunities.

But perhaps the firm's most account-winning feature is its hybrid of traditional and online media and its ability to seemingly quantify and justify every move it makes. "Our model is largely different from other shops' because we're not just resting on the laurels of media clout," says Finnegan. "I'm not seeing other shops follow through. I'm seeing grandiose visions not capitalized on and too many dumb dollars in the marketplace. Some shops spend ludicrous amounts of dollars that may not have a strategic connection with the consumer or a relationship to the audience base and may be placing money in a medium for the sake of placing it - for cost."

OMD Digital's team and solid processes have positioned it well in new business competition. In one year's time, the agency picked up such coveted accounts as Dell Home Systems, Dannon, Neutrogena, and United Airlines - an nice feat. One of the first new accounts the Chicago office took on in 2003 was Dell Home Systems. It created the internal processes, put together a team, and implemented campaigns in a matter of weeks from the time the business was awarded. "The normal implementation cycle was cut by more than half," says Finnegan.

United Airlines saw similar results when it awarded its Internet business to OMD Digital, moving the account from Fallon Worldwide. "We chose OMD Digital because it was an extremely strong strategic shop," says Pam Stein, Internet marketing manager at United. "But what was particularly attractive to us was the fact that they go beyond media."

And the transition was seamless, she recalls. "In a matter of days, we were up and running on projects that would normally take weeks and months." The agency's secret: "OMD Digital is like a small shop inside a big shop," she says, "and they're able to lean on the resources of the larger agency." As a result, "they had resources on the ground and ready from minute one and they exceeded our expectations."

While all the AEs reside within the traditional media groups, both the traditional and digital teams are housed within the same buildings and on the same floors in Chicago and New York. The staff attend regular status meetings together.

A recent online/offline project that partnered Cingular Wireless with NCAA and CBS Sportsline is an example of a cross-media team working together for a common goal. "Cingular Wireless started out more on the brand side before the merger," Minsky says, "and we found really great synergy internally. Now we're doing impactful advertising coupled with trackable results."

Finnegan feels that OMD Digital will be defined not by its past achievements but by its nimble ability to continue raising the bar. "We don't have the ability to rest on our successes," he says. "We're only as good as next week's results." It's exactly that kind of attitude that has put the firm at the front of the pack.

Bronze "e" Winner for Analytics and Research: Avenue A, by Steve Smith
Two of the most cutting-edge and scientifically minded ad companies in the industry followed some old-world advice last year: Marry your own kind. When aQuantive, parent company to Avenue A - this year's Bronze "e" Award winner for analytics and research, decided to complement its famous media planning agency with full-service i-FRONTIER, the idea was "to fill a strategic hole" and provide creative services, says Avenue A president Clark Kokich. But the cultural fit between the two companies has proven especially effective in landing new clients. Astra Zeneca and Alaska Airlines made Avenue A/i-FRONTIER their online agency of record in 2003. Both agencies bring to their clients and their campaigns an uncommon devotion to metrics and how measurement and monitoring make online a killer ad app.

In introducing its ChannelScope product late last year, Avenue A brought to fruition breakthrough research methodologies that prove and track what some consider the elusive holy grail in this medium, connecting online promotion to offline retail results. "We always believed that there is more traffic being driven to stores by online than is being driven to e-commerce," says Kokich. And after several years of research with clients like Nike, Best Buy, and Eddie Bauer, Kokich thinks they have the metrics to prove online's real-world worth and help clients make better cross-channel media planning decisions. "We discovered this year that metrics have evolved from simple online measurement of cost per sale to much more useful ones of growth margins on ad investment. We look at the ROI across all sales channels," Kokich says. Avenue A always had a reputation for micro-managing ad deployments and drilling its numbers doggedly to optimize on the fly. Armed with new and broader metrics, clients are treating the Internet as a genuine ad medium. "It's moving beyond its direct response roots and starting to assume the same role as all forms of offline advertising," says Jim Warrner, president of Avenue A/ New York. "Whatever the marketing objectives, the medium can be built to suit them."

In i-FRONTIER, aQuantive - which also owns metrics giant Atlas/DMT - and Avenue A found a numbers-driven soul mate. In its campaign to drive both brand awareness and online ticket sales to Alaska Airlines, "we saw huge success integrating creative and media to ratchet it up and make sure we got the best results," says Brad Aronson, president of i-FRONTIER. With creative, as with placement, the mantra is test and measure, then test and measure again. Sounding eerily like Kokich's twin brother, Aronson says, "It's a metrics-based business. We relentlessly focus on how we can maximize our creative results, to adopt testing matrices and make sure we are doing the right creative optimization." To project the effectiveness of creative, i-FRONTIER uses "regressive modeling," which efficiently identifies how a broad range of variables (color, offer, size) combine for various results.

As nerdy as it sounds, the Avenue A/i-FRONTIER obsession with numbers has helped bring in 50 percent more revenue in 2003 and six new clients and, Kokich says, "this gigantic growth in online is just the beginning of what we think is going to be a continued snowballing of growth." His company seems to be demonstrating that metrics is power.

Bronze "e" Winner for Innovation: Starcom IP, by Phil Leggiere
"We try to pride ourselves on using media in ways no one has done before," says Jeff Marshall, VP of operations at Chicago-based Starcom IP, this year's Bronze "e" Award winner for innovation. "The first thing we look at in a campaign is what we can do that's both effective and different."

Sometimes innovation is about seizing the moment and recognizing possibilities before anyone else. This is something Starcom IP did boldly this year in expanding the traditional upfront television media buy to include broadband online video.

Where before streaming video had just been a bolt-on to TV-centric campaigns, Starcom IP was the first to see that video impressions online could work in tandem with TV in a synergistic package. This, Marshall explains, was the perfect opportunity to extend the reach and frequency of TV buying dollars. Online CPMs were down and broadcast costs were up. Working with Starcom MediaVest Group (SMG), 10 premium clients and such venues as AOL Broadband, Atomic Shockwave, ESPN Motion, The FeedRoom, and Yahoo Platinum, Starcom IP pieced together a pioneering upfront package combining the best of both the off- and online worlds.

"In looking at the 2003-2004 upfront season we saw several dynamics at work," Marshall recalls. "First, broadband usage, after much delay, had finally broken through the adoption curve. It was now really ad ready. The upfront is still the focal point for the greatest amount of media dollars invested, so expanding the process to include online networks brings smart opportunities for clients to distribute their television advertising over the Internet, reinventing the meaning of upfront for a new era."

Sometimes innovation involves combining old and new media in radically new ways. As Marshall explains, "Working on our McDonald's campaign this year, the challenge was to use Ronald McDonald to communicate a shared experience both moms and kids could appreciate. Our premise was that learning is fun and that interactive learning involving Ronald McDonald would attract kids." At the same time, he says, "we were sensitive to the fact that many parents are resistant to have their kids in an unprotected online environment. So we needed to invent a medium to address both issues."

Partnering with Nickelodeon, Starcom IP developed a new ad venue, an interactive learning CD-ROM distributed to over 1 million parents and kids in Nick Jr. Magazine and advertised on Nick's TV and print properties. Once the CD-ROM became a hit, parents could then go with their kids to, where CD-ROM learning materials were repurposed on the website in a child-safe environment.

An affiliate of Publicis, Starcom IP specializes in what it calls "navigating the future of communications architecture." With 90 employees and 60 clients, the firm billings were $120 million in 2003, all for interactive work. New client wins for the year included Disney Studios, Disney Toon Town, and Baby Einstein. The firm also boasts such veteran clients as Kellogg, Allstate, the U.S. Army, and Miller. The firm looks forward to continuing to explore different communications media in 2004, and plans to devote its considerable imaginative energy to gaming platforms and wireless.

Bronze "e" Winner for Planning and Strategy: Carat Interactive, by Phil Leggiere
"You won't find any magic bullets or gimmicks that make our approach to planning unique," explains Greg Smith, EVP and director of media of Carat Interactive, this year's Bronze "e" Award winner for planning and strategy. "We just try to do our homework a little harder than anyone else and, above all, to leverage knowledge to ask the right questions."

The firm, part of the Carat/Aegis group, garnered over $268 million in 2003 billings, $251 million of which was for interactive media. CI president Sarah Fay attributes this success to moving beyond a single-minded focus on conventional reach and frequency.

"We pride ourselves on taking communications planning a step further," she says. "In addition to just choosing channels and forming a strategy based on traditional reach and frequency, we think first in terms of whom our targets are and, above all, how we can get them involved. Our approach is not just about covering a target audience with messages, but about discovering which messaging approaches are really breaking through to that market."

One of the planning breakthroughs of the past year the firm is most proud of is the sweepstakes campaign it developed for automaker Hyundai.

"Everybody knows that a huge percentage of serious car shoppers go online to do research before making a purchase," Fay says. "But the conventional wisdom has been that people get their brand awareness though offline ads and go online for specific product information."

Based on studies of online car shoppers, Carat Interactive convinced Hyundai that conventional wisdom was wrong and that online promotions could also help build brand image. Partnering with MSN, Carat Interactive and Hyundai in spring 2003 launched an Academy Award sweepstakes sponsorship. The online-offline promotion, called "Stars in Your Eye," was designed to get people to enter a contest to win a free trip to next year's Oscar award ceremony or a new Hyundai car. The promotion was the most successful online initiative in Hyundai's history, resulting in double-digit monthly increases in quote requests and hundreds of thousands of sweepstakes entries, 25 percent of which opted in to receive more promotional materials. Validating Carat Interactive's unconventional planning premise, the campaign also dramatically increased brand awareness - by nearly 50 percent - and caused a 25 percent lift in model awareness for the new Hyundai X6350.

Other big buys of the year included an Adidas campaign for TMac, an Ofoto customer acquisition campaign for Kodak, and a Hyatt "Summer Weekends" promotion. "The mantra in media planning for decades has been reach and frequency," reflects Fay. "We think we're expanding that paradigm, showing that what planning is really about is targeting and involving."

Carat Interactive has offices in seven American cities and 16 international locations.

Bronze "e" Winner for Strategy: Universal McCann Interactive, by Steve Smith
On the day in 2003 when Universal McCann Interactive (UMi) roadblocked two of the top Internet portals with Coca-Cola-red backgrounds and made traffic to spike to five times its normal rates, this year's Bronze "e" Award winner for strategy not only helped bring Coke's branding relaunch to the Web in grand style, it also pointed the way to future online media planning.

Deep integration with valued media brands seamlessly executed across multiple touch points is the best defense against fragmentation. Publishers balked at the unconventional format and intrusiveness of the media buy, but UMi was determined to make the online piece of the massive Coke campaign at least as unmistakable as it was offline.

"We really looked to push the envelope and push the comfort zone," says David Cohen, interactive media director. Precisely what the client had in mind. "We created ad positions from real estate that was not typically available to advertisers in order to deliver a true sight, sound, and motion experience," says David Raines, VP integrated communications, The Coca-Cola Co.

"As consumers become more empowered to control the who, what, where, and when they view entertainment," says Cohen, "the efficacy of the 30-second TV ad or the page in a magazine will diminish. In that brave new world, what do we need to do to connect?" Planners need to get more comfortable exploring sacred boundaries between ad and editorial, between welcome information and intrusiveness. "You can provide value and entertainment, and then consumers won't mind your occupying a sacrosanct place."

The UMi media plan for a fragmented universe is more than simply being everywhere with a message. It is to drill deeply within content that audiences themselves will follow across platforms.

"The important thing is to be aligned with content or brand no matter the medium," says Cohen. When Johnson & Johnson sponsored a special prime-time episode of ABC's "The View," "His and Her Body Test," UMi engaged viewers in real-time interactive quizzes across three platforms (synchronized Web and TV, enhanced TV via Wink, and mobile phone text messaging), exposing consumers to 15 J&J brands. By sticking close to content and media personalities that the target audience is willing to follow anywhere, UMi helped its client talk directly with 54,000 consumers in an hour's time. The cross-platform technology also garnered an Emmy nomination for its innovative use of interactive media.

With $114 million in billings, Universal McCann Interactive is making the most of its place within Universal McCann's expanding universe of $7.1 billion in billing to the likes of Microsoft, Sony, Wendy's, and General Motors. "The ability to reach multiple touch points and to make them sing harmoniously - that is the goal," says Cohen. "Our overall reason for existence is a belief in integrated communication, that the sum of the parts is greater than the whole."

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