From indie to network: how Mekanism repositioned itself to grow
Ahead of The Drum Awards for Agency Business later this year, we caught up with Mekanism – which won the Independent Agency of the Year (150+ employees) in 2021 – to find out how business has been going.
The ad agency was founded in 2003 and quickly grew across the United States, with offices in San Francisco, New York, Chicago and Seattle, before being acquired by Plus Company just a few months ago. It counts brands including Peloton, Ben & Jerry’s, Jose Cuervo, Alaska Airlines, Charles Schwab and OkCupid among its clients.
Jason Harris, chief executive at Mekanism and co-chair of the awards for 2022, catches up with The Drum. His answers have been edited for length and clarity.
Mekanism was recently acquired by the US network Plus Company. How did the deal come about?
This was a big change from when we won the Independent Agency of the Year award to where we are now. And it happened right before Cannes this year. We’ve been independent since we started and didn’t necessarily have a plan that we were going to be acquired.
During the pandemic, our model was Mekanism, along with a media brand, the production company Sister and a social media agency called Epic Signal. We had all these sub-brands, but when the world shut down before we won the award, the decision was made to shift everything to just one brand.
The company was then repositioned to be all about soul and science, which is essentially creativity and performance. We built a performance analytics department and really started to add the measurement piece to the creative side of the company.
Then we met Plus Company, which is a new model holding company. It owns a couple of brands including Cosette in Canada and We Are Social, and Mekanism was acquired to be its US centerpiece.
We’re keeping the brand, identity and culture. They’re going to build much more on the performance and science pieces for the company, and that’s why it made sense to us because we can grow faster with some investment dollars and still keep the Mekanism identity.
What have been the biggest challenges for Mekanism in the past year?
17 years ago, we started out as a digital production company and then shifted to a viral marketing company. We moved on to become a creative production company, and then in 2010 became an agency.
In one day we decided to call ourselves an agency and had to hire and build a strategy department – a brand management department. The challenge we had was selling it and building as we went versus building out a new offering, bulletproofing it and then releasing it out into the world.
We’re straight to the point. If we say we’re going to do it, we start building.
What challenges are clients coming to you with?
There has been a lot less risk-taking in the industry and more fear from brands about meeting the shareholder numbers they need to hit and revenue targets.
A lot of that came from the pandemic, and we’re coming out of that now with brands regaining that confidence and being courageous again. But during that period, when the world was turned upside down, clients really tried to get back to basics and get back to the work that could be measured. They knew when they were putting money in how much they were getting back versus longer-term brand-building work.
There is also a trend where clients want one or two partners to do everything. They don’t want five or six specialized agencies that they have to wrangle. It’s too much work, and the brands have too much on their plates.
Where is Mekanism finding growth opportunities?
We’re seeing the opportunities of building out more services, and more organic growth, because we’re taking more on from the brands that we have. One big success that I’ve seen is that our new positioning has led to a strong new business win rate for us. Our win/organic growth rate so far this year is 70%, which is the highest it’s ever been, driven by our ‘Soul and Science’ positioning. It resonates with clients because we can do the creative work, and then come in and measure the results. We know where to put the money and what is working, and that’s been turbocharging our success.
How has agency culture evolved at Mekanism?
People get into advertising because they are creative thinkers and like social interaction. It‘s been much harder to maintain what makes the culture at your agency different than any other culture. We have seven foundations that we started the company on – they‘re printed in employee journals and are part of our performance review. That‘s how we interview candidates.
Our culture is strong, but it is a culture based on interaction and social. Every year we have a summit where we bring all four offices together, which has been virtual for the past two years, but we’re now in the office twice a week. It’s remained strong because we have these values that we lean on. But I’m anxious to get back to a balance of in-person culture and virtual culture, and build back that social space.
What does the next year look like at Mekanism?
On the client-side, new work was launched for a brand called Stitch Fix, and a lot of new stuff coming out that we’re really excited about.
For us as a company, in the next 12-18 months, of course, we’ll be working with Plus Company to really grow and potentially acquire companies to sit underneath Mekanism. From that, we’ll be growing out the full funnel offering as an agency, so we can do everything from business, brand strategy and creativity, all the way down to CRM and selling e-commerce.
To enter The Drum Awards for Agency Business, make sure you submit your entry by Wednesday July 20.