No matter how you view them – as the future of advertising or as companies where talent is stretched too thin – the number of agencies offering an integrated service is on the rise. Driven by the increasing fragmentation of media and by clients with a meticulous eye for budgets, a whole host of agencies have felt the need to offer a wide range of services. The benefits seem obvious, but not everyone thinks this is the way forward for the industry.
Daniel Clare, managing director of Union Direct, says there’s one massive pitfall in becoming a multi-service agency: “The danger is that you can be perceived as a jack of all trades and master of none. It’s seen as not having strength in depth.”
Carole Matthews, director of Matthews Marketing, agrees. She fears some multi-service agencies promise specialties they don’t have. “Integrated agencies don’t always possess all the specialisations required, nor do they necessarily offer every service to an equally high standard,” she says. “But a great agency knows exactly what it can and cannot deliver and doesn’t over-promise.
“Everything we do should be viewed from the client’s point of view. If the customer has to approach a series of specialist companies with a project brief, they will not find the same flexible approach or commitment to the complete task that our company offers.”
For Gary Smith, joint managing director of 1576, there are advantages for clients going down the integrated route. “An integrated agency can offer all of its services under one roof – and often with a lead team member – which gives the client an obvious benefit of having a number of specialists coordinated by one point of contact,” he says. “A further benefit, which may not be as obvious but is crucial to offering best advice, is that while an agency like 1576 offers a range of disciplines, we only have one bottom line.”
Despite all the pros and cons, it’s still early days for integrated agencies in Scotland. In fact, Scott McBride of design agency Ocean70 says we’ve only seen that start of the integrated trend. “In Scotland we have gone through a start-up period and I can see the beginning of consolidation in other areas, not just purely on the economics side, but also in respect to developing new business and in response to market/client needs and desires.
“Why put a client off because you have pigeonholed yourself as a direct marketing or advertising agency? You’ll no doubt be able to develop the strategy, the creative and all the other bells and whistles, so why not let the client’s objectives and the strategy define the medium?”
Although it’s early days, Peter Clayton, managing director of Clayton Graham, is scathing in his view of the growth of integration in Scotland: “I’m embarrassed by the way the Scottish market is converting to integration. I think it is born out of being very bad at winning business that is anything but local. This creates a need to grab more of the client’s additional budgets to remain profitable.
“Don’t believe me? I see many agencies converting to integration, yet none of them are hiring. They are really just multi-tasking with the same people. They are, in effect, using all the benefits of integration for their own gain. Sadly, they are suckering clients into coming on board.
“My advice is simple to Scottish clients: don’t set out to pick a genre of business – just pick the best. If it happens to be integrated then you inherit all the advantages as a bonus. Whoever claims integration should have to prove it rigorously. It amazes me how many agencies are currently pulling the con and getting away with it.”
Sue Mullen, managing director of Story, highlights her concern for clients working with agencies offering a range of services. “On a big account, multi-disciplined agencies inevitably field a dozen people. Nothing gets done efficiently and everything gets process driven as people tend to guard their territory. In my experience, after a short while, the client will look to tighten the team and have one or two multi-disciplined ‘intelligent’ people to make things happen.”
Ian McAteer, managing director of The Union, says an agency describing itself as a one-stop shop would argue it is best placed to provide true integration – but one discipline tends to dominate the rest. “It’s difficult to stop this happening,” he says. “The hybrid model we have allows for champions for each discipline, but under one roof. Ultimately what matters is the attitude and leadership from the top – the ethos of the agency and how it trains, motivates and develops staff to deliver the service to clients. Investment is also crucial – you must invest in specialist talent.”
Paul Sykes, business development manager at Avian, highlights an alternative marketing option: “Major international players with brands that have marketing-heavy requirements increasingly prefer the pool approach that allows them to cherry-pick talent across the disciplines.”
Another developing trend can be highlighted by The Leith Agency, the advertising arm of the Cello group. Cello has launched several specialist divisions across the UK – including Stripe for PR, Blonde Digital in the digital sector and Leithal Thinking for brand consultancy – which can work separately or in tandem to meet a client’s needs.
But if clients seek to work with integrated agencies because they feel they offer ease of service, many clients may be put off working with an umbrella company’s sister agencies, believing this to be similar to working with a number of single-service firms. However, Ed Brooke, a partner at The Leith Agency, denies there is any real complication in the process of involving another company from inside the group in a campaign.
“We give clients a full picture of all the different services that Cello offers,” he says. “If there are certain parts they want to look at and pick and choose, we’ll facilitate a meeting with that company and take it from there.”
Yvonne Balfour, managing director of Navigator, the direct marketing arm of Cello says the expertise of individuals in the company can prove to be a huge incentive in attracting and working with clients. “We can call on other expertise and have access to international credentials, which is a key part for some clients. There may be an industry sector that we don’t have as much expertise in, but one of our sister companies does.
“We’re increasingly talking to our sister companies. It’s growing all the time, so the relevance in the organisation is something for us to tie in with, where we can either do joint pitches or call on their expertise. That’s increasing because of the spectrum of companies in the group.”
“There is absolutely nothing to say that different agencies working under an umbrella cannot offer as integrated a solution as an agency claiming to be an integrated agency,” says Helen Hourston, director of creative services at IAS Smarts, playing devil’s advocate. “In theory, there is no reason why they can’t work together because it all depends on the relationship between the people and how prepared they are to work with each other to get the right solution.
“Where it tends to fall apart a little bit – and where there is a real strength in what you might call an integrated agency – is that when you’re working within an umbrella company, everyone has their own agenda. They have their own profit centre that they’re trying to build.
“People can be competitive with each other within that environment, and I don’t necessarily believe they will have the best interests of the client at heart because there is too much of an agenda in the background. I’m not saying that is what always happens, but there can be a tendency for this to happen.”
Gary Smith agrees that things could become complicated for clients who find themselves working with a host of other companies, possibly each looking to meet their own needs. “As soon as you start introducing other companies to the mix, they all want to do what is best for themselves rather than the client, and you can all too easily have a battle over the client’s budget. That approach is counter-productive for the client and can lead to recommendations driven by the agency’s agenda rather than the client’s needs.”
Balfour defends umbrella companies though, pointing out that all agencies have to look at the bottom line and will be looking out for their best interests to an extent. “Of course agencies are looking out for number one,” she says. “And that happens at the different sub groups within integrated agencies as well. Everybody has a balance sheet and a corporate loss account.
“It’s not the domain of group companies and it’s not the domain of independents. You’re doing it for the good of the client, and if the client is asking you to work together in an integrated way, then that’s what you do.
“The idea that the client had a certain budget and that everybody will be fighting over that budget is quite old fashioned. Increasingly, with a lot of our clients, the agencies are all sitting around the table, working together – whether that be part of Navigator working with some of the Cello companies or working with other agencies that are not part of Cello. We all have to sit around a table and have meetings with the client, have planning sessions and work in an integrated way.”
Philip Hogg of Miller Homes agrees that a client should be looking to work alongside the most creative and best suited agencies available. He also believes that a client coming to an umbrella company and looking at the range of services on offer must be convinced that there is a close relationship throughout the group.
“It’s interesting, but then you have to say to yourself, ‘This is part of an umbrella organisation and I’ll work with that one company so maybe working with its sister company is a good idea.’ But it all depends on how well those companies under that umbrella work together. If they say, ‘Yes, we’re sister companies,’ yet they have no day-to-day dealings with them, then it’s almost irrelevant. You’re having to work with them, almost as a brand-new company and having to go from scratch and explain the business.
“I’m not sure that we, as clients, would necessarily see the benefits unless there is a close working relationship between those sister companies.”