As internet channels have become more and more important to businesses, a new generation of digital agencies have sprung up to assist them.
The value proposition of the digital agency: at a time when technology is evolving so rapidly, it takes specialist knowledge to successfully navigate digital marketing channels.
Based on this, one might expect the future to be bright for digital agencies, but according to a survey conducted by RSW/US, a business development firm, that may not be the case.
In surveying client-side decision-makers, it found that more than two-thirds of respondents felt digital agencies "need to offer more traditional services to maintain relevancy." Only a third believed digital agencies can survive with digital alone.
Looking ahead, RSW/US sees a full half of traditional agencies earning more business for digital assignments within the next five years. The key to that, eMarketer suggests, will be traditional agencies "[becoming] more sophisticated in their digital offerings and [finding] the same deep insights that have set apart their digital-only counterparts."
Interestingly, SEMPO and Econsultancy's State of Search Marketing Report 2011 seems to contradict RSW/US's findings. In our survey of 900 client-side advertisers and agencies, respondents favored specialists over generalists for SEO, paid search and social media.
For companies looking to hire an agency, which approach is right? Obviously, that depends. Companies that are very active in a multitude of channels may find that working with a traditional agency is attractive because a traditional agency may have a better capability to see the big picture, even if its domain expertise in any particular area is not as deep.
On the other hand, a company that derives a significant return from very specific channels, such as SEO and paid search, may have a difficult time trusting management of those channels to an agency that doesn't have expert-level knowledge.
Reader comments (13)
Consultant/Director at ThinkSearch
4:13PM on 10th May 2011
No contradiction.
Surely this just points to digital marketing agencies needing to be better at marketing rather than just digital.
It's time to start dropping the 'digital', as almost everything is now...
4:15PM on 10th May 2011
This doesn't come as a surprise at all. We operate across multiple channels, yet 70% of our business ends up being in the digital arena. We have found all our clients value strategy and creative campaigns that pull together their desired consumer experience, from engagement right through to point of sale, and the digital channel element doesn't even enter into it.
The agency market has evolved, it's not channel specific it's consumercentric.
Exactly as it should be.
4:27PM on 10th May 2011
As rightly talked in the above article, our experience working with agencies shows that there is an increasing demand for holistic approach towards digital marketing from many companies.
8:03AM on 11th May 2011
Hi,
The scope of digital agency can not be neglect at any cost. It`s very important that how agencies create their market need in this context. Marketing is the most important thing in any field and we can not stay for a long time in market without proper planning of it. I do agree with you Janaki that holistic approach is a common need or demand at this moment. By controlling this factor a digital agency can compete in its area very well.
9:04AM on 11th May 2011
I have two agencies DTH Advertising a traditional Press, TV and Radio company and about 30 years old and Deepblue-digital (the clue is in the title) a more modern web design, seo and marketing company. We have seen a serious decline in the press and radio bookings for DTH over the last 4 years and a massive increase in web design, web management and SEO in the last 3 for Deepblue-digital. Although we still offer a good mix of old and new and design for print, for us, is a very healthy area of the business.
Managing Partner at Navigate Digital
10:53AM on 11th May 2011
The agencies that don't evolve won't die, they just won't get any bigger. Agencies need to be light on their feet to reflect the environment in which they operate in and the requirements of clients.
PMO at Magdalena Medio
2:37PM on 11th May 2011
And it is going much more complicated with all the new devices in game. WE will go back to the 'old days'
Managing Director at LHM Media Ltd
10:28PM on 11th May 2011
'Digital is the new dinosaur' and 'Apps are the new web'. We've seen this style of approach before. The stats speak for themselves in spend and global usage.
Agree wholeheartedly that digitally focussed agencies need to improve with marketing, but the NMA top 100 proves that this story is wrong. There is some quality work out there.
Agencies from PR, Broadcast, Media, Digital are all moving in to online engagement in some way, but just because an ad agency can manage a Twitter account and an open source blog doesn't mean they can build a CMS, functional tools and incorporate a brands personality online.
Old skool marketers jumping on the bandwagon are making everything cloudy for clients who have been bitten by choosing the wrong option either by price or keeping existing relationships.
Freelance Digital and Ecommerce Consultant at 52art Ltd
11:18AM on 12th May 2011
As someone who has worked in both, but sits very firmly in the integrated camp, there are times when an integrated agency is the better solution and times when a specialist is the better.
As agencies perhaps we need to be more discerning at understanding when intergated is better and making that case?
The other point to make is that some integrated agencies can be as good, if not better, than a specialist in some disciplines.
We can hold our own in a whole range of digital disciplines against a specialist, because of the marketing knowledge and strategic thinking we bring. I'm happy to go up against a specialist in areas such as email marketing, paid search, website design and optimisation as well as creative work for online advertising etc.
I'd even go further and say that I'd be excited to go up against a specialist as I know what extra we can bring to the party.
Founder at McCormack Morrison
10:22PM on 12th May 2011
I see this as a non issue for good digital agencies. Traditional ad agencies are making it easy for digital natives with the fad chasing rubbish they continue to put out.
9:54AM on 13th May 2011
Each company is different and has different needs, i think they both have their pro's and con's.
10:09AM on 25th May 2011
Sorry, had been meaning to comment on this post for a while, but isn't this what used to be called 'media neutral'? There is definitely a clear role for generalists, who know when to engage specialist expertise, rather than the other way around.
12:59AM on 6th April 2013
I agree with John, agencies just need to be flexible and able to adapt to the environment they operate within.
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