I was recently asked about my thoughts on the blurring of the lines between what used to be traditional (marketing) consultancies and agencies (digital, media and creative).
Who are we talking about? First and foremost, companies like Accenture and Deloitte, but equally so the likes of Adobe, SAP or IBM and even Facebook and Google. Do marketers or their agencies have a real cause for concern?
We have certainly heard from some of our clients that they are questioning the wisdom of sharing their confidential client data, be it media or agency pricing or other proprietary content, with consultancies who are themselves at the same time (digital) media management companies, data companies or creative agencies (or all of the above). Whereas the auditor or agency adviser in the past was valued for their independence, with some these lines having become blurred their impartiality is now in question.
The agency’s argument is that they do not want to share their media buying results (traditional or digital) or their pricing and incentive models with an agency auditor who could use those results to determine their own price points and competitive strategies that could very well undermine the traditional agency.
The same is true for the consultant’s creative review services. If the consultant gains a detailed knowledge of the time, the cost, the number of FTE’s, the production cost, etc. that the creative agency is charging for its work, it would be fairly easy for the consultancy to develop a competitive proposal for the for their own creative offering.
Accenture and Deloitte present easy to spot conflicts of interest in these scenario’s. But don’t underestimate tech companies either. IBM have a business called IBM Global Business Services with a thriving consulting arm. SAP offers “Digital Business Services”, offering digital transformation strategies and planning. Adobe, Salesforce, Google and many others with direct client relationships will offer their help with the development and implementation of brand innovation, market discovery, digital media services, data and cloud applications, and much more. And it is obvious that some of these encroach very clearly into the domain of the advertising agencies. Or, advertising agencies have encroached into the domain of the consultants.
The other question marketers are asking is if the service providers that are absorbed into a consulting group can maintain their competitive edge. We are of course in a people driven business, and as is always the case, it is a question if the agency or service that is purchased can retain their key people, and if the cultures of the two entities can successfully merge and align.
Being able to drive revenue and cost savings through mergers and acquisitions is a valid strategy for growth, also in consulting. Agencies have done this for decades. I think it is fair to say that in terms of agency services, marketers are in a buyers market, and the increased competition is, from their POV, probably not a bad thing. But I think it is also fair to say that as much as agencies have agenda’s that are set by their own business interests, this is now more and more true for many of the consultancies as well.
As the saying goes: “For a man with a hammer, every problem is a nail”. Make sure that, as a marketer, you hit the nail on the head when working with consulting firms, and that a man with a hammer is what you actually need.
If you want to find out if you need a man with a hammer, or would rather connect with a team that has over 250 years of experience in dealing with men with hammers, contact us below!
[Maarten is a featured contributor to MediaPost, this article was originally published here]