Should agencies absorb their digital siblings?

Chris Ryan, CEO, Aegis Media Hong Kong says NO

“Right now, the answer is no. First we must ask “What’s best for our clients? Do they want integration?”  Most definitely. “Do they want specialisation?” Yes. Ask them if they have found best-in-class digital services under the roof of a traditional agency and the answer is invariably no.

We all know new media is no longer new, but it is digital that is driving today’s media revolution. It is still a highly specialist, rapidly changing business, driven by a different culture and different mindset to that of traditional agencies. Digital outfits have been absorbed or,  more accurately, consumed by sister agencies in the past. The digital offering suffers, traditional thinking eventually dominates, digital staff become disillusioned, and they move on. They are rarely replaced with comparable talent.

For now, the most optimal approach is to maintain high digital standards  through a specialist outfitand make a model of collaboration work for our clients.

If and when the time is right, it might just be that digital agencies absorb their siblings, rather than the other way around.”

Nico Abbruzzese, head of digital Asia-Pacific, Maxus, says YES
“Having separate digital agencies is a little like thinking that you can park your heart outside your body and use that only when a pitch is on.

Digital has now become (at least at Maxus) the heart of how we think about media, from insights to in-market presence. It’s the augmenting factor in any campaign, especially traditional media.

It’s commonly known, for instance, that in association with airing a TVC you have spikes of activity in both search and social media and, even more importantly, roughly 90 per cent of sales funnels are initiated online.

This fact alone is pushing businesses to understand that digital can’t be an afterthought.
Making digitally-enabled thinking an integral part of our planning processes in both creative and media, is becoming a cost of entry in this new consumer market place.

Ultimately it’s not about being absorbed - and therefore losing specialist skills, focus and talent - but more about placing digital at the heart of a redefined offering.”

Steven Chang, CEO, ZenithOptimedia Greater China says YES
“If we define a digital agency as a full service agency, which includes more than media and creative - such as e-commerce and CRM - then it can easily be stand alone, as that means a specialist digital agency that focuses on digital offerings.  

This is quite a common practice, particularly in the Western mature markets such as the US or UK.  However, if the digital agency primarily provides media services or creative services, it can be easily incorporated into an existing general media or creative agency.  

Most clients would rather minimise windows of contact for the sake of convenience, so it may be good for the digital teams to be part of an agency group.  This allows scale and skill speciality, which at the same time provides a chance to have a single point of contact for the client.

The real question is whether the digital service can be fully integrated with the rest of the marketing and advertising effort.  Clients are looking for one integrated service provider that can manage through-the-line programmes for them.”

Jonathan Lang, head of integrated marketing and strategy planning, Y&R Singapore says NO
“The question of branding or locations of digital agencies or mainstream agencies is not really the issue. This is often dictated by the way clients buy digital, existing relationships, or the way the holding company manages their brand architectures; often for competitive reasons.

Surely, rather than where their offices are or what sign is on the door, the point at issue is how collaboratively digital and mainstream work together? They need to be thinking, working and creating as one if they are to deliver on the promise of modern, integrated communications.

Success will come to those who understand what it takes to make this work.

In any case, all of this is semantics, because in five years time digital will be far less a ‘vertical’ channel, and much more a ‘horizontal’ discipline.  So maybe we should also be asking whether it’s better to be a great digital agency or a great agency for the digital age?”

This article was originally published in the 29 July 2010 issue of Media.