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The Brand-Agency Disconnect on Data Management

What’s the biggest difference between an agency and a brand in their deployment of data management platforms and data-driven strategies? Working with dozens of brands and agencies across the globe, it’s a question I get asked a lot, and the answer is often always the same. The biggest difference between the approaches of agencies and advertisers is the mind-set with which each party approaches the data management solutions. And if there is anything I’ve learned in the past two years working with DMPs, it’s that mind-set is everything.

In short, brand thinks long-term, where agencies fixate on tactical short-term execution.

This disconnect isn’t surprising, at least to those of us working with both brands and agencies directly, and it isn’t the fault of the agency (at least not solely).

For the most part, agencies are briefed by advertisers on a tactical basis, with quarterly (or often shorter) campaigns, and short-term deliverables. This perpetuates a mentality that incentivises and rewards short-termism and sacrifices the development of long-term partnerships, which is probably why the industry average for the length of a client-agency relationship is just 3.2 years (according to the 2016 report by R3).

As a result of these ingrained practices, agencies focus on what can be achieved within the next 1-3 months and rarely look beyond that. New tools, technologies and approaches have a short half-life in proving value before they must be abandoned, and agencies are continually under pressure to provide quarter on quarter spikes in efficiencies, as oppose to incremental, yet more consistent improvements over time. The confusing thing is that brands tend to think more long-term, and view the internal development of new practices and the implementation of new technologies as long-term investments, requiring iteration and trial and error, and most importantly, time.

Both approaches have their benefits, and it’s not too hard to see how the current dynamic evolved around media execution. When it comes to the efficient delivery of media, the agency is second to none, able to turn around well-constructed media schedules in a short timeframe and to execute against those schedules with consistency. It has also been 90% of the reason why brands have engaged media agencies up until about 2 years ago. But the world is changing, and more is being asked of agencies to create and deliver audience management solutions and data-driven strategies on behalf of their brands. This is creating a division between the standard client-agency process of (1) brief, (2) plan, (3) deliver, (4) report and (5) repeat, and a more always on approach to execution, which is continuously adapting and evolving to improve performance over the course of 6-months, a year or 2 years.

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Agencies should work harder to deliver plans that maintain always-on approaches, particularly in dynamic environments such as programmatic and data-driven media, where the most incremental opportunity still exists to learn, adapt and create competitive advantage through innovation, developed practices and overall expertise.
They will have to maintain the tactical element of what they do for now, but they need to do a better job of mimicking the brand’s own long-term approach to media and communications, re-educating brands on the importance of long-term engagements, and resetting expectations around the importance of continued iteration and improvement of media efficiencies over the length of the engagement, not just from one-quarter to the next. 

 

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