4 Things Agencies of Record Can Do to Survive the Trend of ‘Projectization’

Karen Kaplan Alex Fine

Recently, we talked to several top CMOs from leading brands about agency roles and the AOR model. We asked them about their pain points and how an agency could make their job easier. And the biggest takeaway from those discussions was surprising: that our interests (agency and CMO) have never been more aligned.

CMOs are scrutinizing agency costs and roles, while at the same time determined (with tighter budgets) to deliver consumer engagement across multiple channels and platforms. It's no wonder the AOR model has become increasingly threatened in favor of piecemeal project work. CMOs logically ask the question: How could one agency really be the solution to all of one's complex marketing challenges?

But is that the right question? CMOs are telling us otherwise. They acknowledge the need to have discipline experts, but under the guidance of a lead agency—and even more importantly, a lead idea.

Ten years ago, the exclusive agency/brand relationship was the norm. Indeed, at that time, most of our client relationships at Hill Holliday fit that model. That gave way to the lead-agency model made up of a team of specialized agencies. And now, more and more often we find ourselves competing for project work. The CMOs recognize that "projectization" only increased fragmentation, and fragmentation derailed the customer journey, diluted the brand voice and overwhelmed the consumer. More is not more for consumers; more is too much, and avoidance is rapidly becoming the new default.

CMOs and brands are hungry for an answer that addresses their challenges and uncovers opportunities. CMOs, especially those in charge of brands fighting a daily share battle, are realizing the value of an AOR. And after several years of trial and error, they recognize the need for a new, more modern AOR.

So what will that look like? Here's what they had to say:

The modern AOR shouldn't claim to be able to do everything really well. CMOs complain that each agency, regardless of original core discipline, now claims that it has the capability to do everything. While they recognize that an AOR needs to be well versed in all aspects of brand engagement, they don't believe they can possibly excel across all disciplines. As one CMO stated: "Be honest. Tell me you do 15 things, but then tell me that you do seven of these really well and that you have to work with partners to do the others well."

The modern AOR should own the integrated customer journey. The modern AOR needs to be able to work closely and selflessly with partner agencies in order to aggregate and curate all brand experiences across a multidiscipline customer journey that tracks not only the behavior of customers, but also their mindset and attitude. This way we can identify knowledge gaps and opportunities, as well as the right channels and technologies with which to strategically target our customers as they move along the journey.

By leading and owning the integrated customer journey, the modern AOR will not only serve as agency brand stewards, but will also critically help CMOs regain stewardship of their own brands. As one CMO advised: "You have to be an orchestra leader. I may not have all the instruments. I may not be able to control them if they want to play something else. Trying to make a beautiful piece of music is becoming really hard."

The modern AOR is all about creative excellence. While CMOs expect us to constantly evolve, integrate and bring them new tools, they also expect us to continue delivering creative excellence. It's not enough to be in the trenches with them, fighting the share battle; they want us to provide the exceptional creative ideas to help them win over time.

The modern AOR uniquely understands how hard the job of the CMO is, and how difficult it is to come up with a simple but magnificent idea that delivers. For the past few years, our industry has questioned the notion of the "big idea" and its relevance in today's market. Because clients have pursued multiple agencies (and all too often multiple ideas), they have effectively fragmented the brand experience. As brands increasingly struggle for share, only the brands that engage consumers with an insightful, compelling, focused idea will win. This is the core craft of the AOR. As one CMO described it: "Part of your winning is how creative your army can be."

Of course there are certainly times when project work is the right answer—for both the brand and agency. And collaboration and respect among partner agencies is always a must have.

IMHO, the death of the AOR has been greatly exaggerated. Let's reclaim it, rethink it and champion its value. Because the truth is, we've never been more necessary, essential—and in demand.

Karen Kaplan (@KarenKaplanHH) is chairman and CEO of Hill Holliday, where she began her career as a receptionist.

This story first appeared in the June 20, 2016 issue of Adweek magazine.

Click here to subscribe.