What Marketers Are Looking for With Media Agencies

Today's marketers expect more from their media agencies and care less about buying clout, according to a new report by global digital agency Kepler, produced in partnership with research company Vanson Bourne. The Media Investment Evolved report includes data sourced from 150 senior marketers at companies with at least $5 billion in annual revenue across the U.S., U.K. and Asia-Pacific region. Tech matters more than buying clout Compared to five years ago, today's marketers are more concerned with managing and optimizing tech platform relationships with strategic investment planning. Media buying and trading has also become less of a concern for marketers over time, with 42% indicating they struggled with this five years ago versus only 14% today. Marketers are less focused on traditional buying and more concerned with strategic moves, such as building relationships with platforms and bulking up in-house operations. With 85% of senior marketers indicating that future media investment performance will be determined by data optimization more than by negotiating media buying at scale, commonly referred to as "buying clout," agencies may find themselves at a disadvantage with marketers if they can't utilize the right tech in the right way. Decades After Splitting, Creative and Media Agencies Want to Get Back Together "Even very traditional marketers are becoming much more focused on driving and measuring tangible marketing outcomes," said Rick Greenberg, Kepler's global CEO. Today's advertisers are increasingly aware that a small portion of the population is driving their business, resulting in the need for precision, he continued. "It's much more about precision than it is just about mass buying clout." Marketers are also concerned about building relationships with tech platforms. While this has been a persistent worry over the last five years, it is becoming more so, with 55% saying it was a top concern today compared to 51% five years ago. A large majority of respondents said they use their media agencies to collect and optimize data, underscoring the relevance of data literacy in today's market. In-housing and co-location are the norm A majority of marketers expressed concern with their media partners, noting that talent and operating models are not evolving fast enough to deliver the support their organizations require. Due to this, in-housing is even more present on marketer's minds, with 39% indicating they are struggling to develop their own internal media technology now compared to 33% five years ago. Further, 53% of senior marketers indicating they use agencies to embed their talent within their own organization. Co-location is also a much larger concern for marketers than it was in the past, with 40% indicating they are struggling with embedding agency talent, compared to 21% five years ago, though it is not clear if the pandemic had any effect on marketers' response to this question. "We are also seeing many advertisers bring their partners' staff into their office so they can sit side-by-side and work more closely together and basically achieve in-housing," Greenberg said. Over half the clients Kepler has won in the last year are utilizing the agency to support their in-house operation. Many other agencies (41% of respondents) are acting as consultants for brands as they build out in-housing and internal technology. "There still is need for an expert intermediary or an expert partner to help [clients] navigate [in-housing] and use those tools," Greenberg said. "I don't think we should be interpreting the data to say that the age of partners is over. What we're seeing is a real shift in the sentiment around what that partner should look like and what that partner should be doing." Media Agencies Are Rethinking Their Supply Chain to Combat In-Housing In-housing is becoming the standard, and a staggering 83% of brands said they are either currently or planning to expand their in-house media investment technology. That percentage climbed to 92% for brands, with sales higher than $10 billion annually, signaling that big companies will be the first to build out in-house media operations if they haven't already. But marketers expressed concerns with their agencies' ability to work with in-house teams, with almost half indicating that their media agency partners could improve on sharing learnings and consulting with in-house teams. And 78% said that in the future they'd be looking for a talent and trading model that will morph around in-house operations. "Agencies need to become much more flexible in their engagement models to accommodate or to meet those clients where they are, to not force clients to just adopt the traditional client-vendor arm's length relationship," Greenberg said. This extends to providing services that go beyond media buying, including organizational design, training, platform consultation and co-location services. The changing landscape is pushing media agencies to become much more strategic and consultative, Greenberg added. Tactical execution is now just one piece of the puzzle.

Media Agencies

New Data Shows What Marketers Are Looking for With Media Agency Relationships

Tech, co-location and in-housing are top of mind

Tech matters more than buying clout

Olivia Morley

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Tech matters more than buying clout

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Olivia Morley