Why Small is the New Big When it Comes to Ad Agencies
As we compete for new business, we often come across clients wanting to be serviced by large agencies, without having a good justification for their line of thinking. The truth is, the giant agencies of the past are dropping like flies lately and bigger is no longer considered better, or even safe, and clients are under increasing pressure from their management to "do more with less." We were once involved in a new business pitch, where the client gawked at the prospect of having our five-person agency handle a $100,000 media buying budget. To put this in perspective, almost 75 percent of this budget could have been spent by designing and purchasing one key outdoor (billboard) location for three to six months. How many people does it take to do that?
Here are five reasons why small is the new big when it comes to agencies:
- Lower costs. Doing more with less is a way of life with small agencies. Agencies of 12 or less employees offer fees and costs far lower than clients pay with monster agencies, without sacrificing quality or creativity. Moving to a smaller agency can translate into savings in the millions for some big-name brand accounts. Also, smaller shops simply by virtue of being more efficiently run, have better oversight of cost controls and handle their finances smartly.
- Access to top creatives. Small agency principals or presidents lead account service, creative and media planning at their firms. Clients can then rely on reaching these leaders to get immediate and informed answers because they are so involved with the account.
- Intensive focus on client relationships and needs. Small agencies don't deal with the distractions of a giant corporate bureaucracy. They also have a more realistic consciousness of the market and are better equipped to deliver a quick response and a quality products because their own bottom line is much more sensitive to a big account loss than a large agency. In other words, small shops give their all when servicing their clients. Who can resist that?
- Better understanding of local markets. Small agencies have higher "street cred" and have a better "ear to the ground" because of their can-do willingness to try new ideas. While big agencies were great at broad mass-reach advertising and mass marketing, the world has changed immensely and we are fast approaching the days where the wants of individual customers will drive the efforts of big brands. This is where an understanding of one-to-one marketing is essential, and that's one thing small agencies excel at. Small agencies deliver local market results and clients are learning that targeted, smaller-reach marketing efforts generate more measurable and desired results than the old broad-reach saturation tactics of big agencies.
- Value proposition. Small agencies routinely go the extra mile for clients because our industry is so highly competitive. This translates to better value on the dollar for clients. And there's never been a time when the bottom line wasn't important.
This month's Inc. Magazine cover proclaims "Small is the New Big." And as the months tick by a number of larger nationally branded accounts have gone to smaller shops. The reasons are plentiful. Could your business benefit from a change?
