Why read this? : Using a marketing agency gives you access to extra skills and resources. But how do you work out which type of agency you need? We share the differences between generalist and specialist marketing agencies. And we share the marketing areas where you most often need agency support. Read this for ideas on how to find the right type of agency.
Marketing’s made up of many different skills. You can’t do it all on your own. At some point, you need help.
That could mean a specific individual. A contractor, a freelancer or a consultant for example. They help you solve a specific marketing challenge.
Or, you hire an agency. They help you with broader, on-going tasks. You get access to their team, their skills and their resources. You pay them. They manage projects and tasks for you.
If you go the agency route, the first step is to work out what type of agency you need.
What you get from an agency
To start, let’s look at what you get from an agency. In simple terms, they help you manage projects you can’t do on your own. They help you with their expertise, experience and time.
You also get access to their resources and processes. They help you with things that’d be harder to do on your own.
Define the type of problem
You start by defining the type of problem you need an agency to solve.
For broad and on-going problems, you need a generalist agency. These offer a variety of services. For more specific, one-off problems a specialist agencies will be a better bet.
Let’s start with the generalists.
Generalist (full-service) agencies offer a broad range of marketing services.
They can be independent, or part of a network of linked agencies.
They typically manage on-going work across multiple projects. These are usually bigger, more complex projects and tasks.
Using a generalist agency means you have one main point of contact to access many different skills. No need to manage different relationships with different agencies. One agency organises the work for you. That makes your life simpler.
You also spend less on account management fees this way. Your lead agency organises everything. You pay them, and they handle all the admin, budgets and any extra agency services you need. They co-ordinate your marketing activities.
That frees up your time. The work should feel more co-ordinated. More integrated.
But they’re also accountable for delivery and business results. If something goes wrong, it’s solely on them.
However, this approach means you’re very reliant on that agency. You put all your agency eggs in one basket. That can be risky.
For example, you often have to sign an exclusivity agreement with them. You promise not to use other agencies while you work with them. But if something goes wrong, or you fall out, you’re stuck with them. That’s a risk you take.
Having a lead agency should reduce inter-agency friction. But it doesn’t always work out that way. You may find other agencies resent the power the lead agency has. They may not put in the same effort as they would working directly with you. That’s not good.
Generalist agencies can also be slower with areas like approvals. There’s more people involved. More opinions to deal with. This slows down decision-making. The slower you go, usually the more it costs.
Specialists agencies focus on a specific marketing activity. That can make delivery simpler and faster. There’s less distractions.
You use them for smaller projects. One-off projects or work you do irregularly.
Specialist agencies are usually smaller than generalists. There’s benefits to that.
Often you get better service levels. Your spend makes up a larger part of their business. Smaller usually also means faster. The less people involved, the quicker the work gets done. It makes things simpler.
Also, because the work isn’t on-going, there’s no contractual lock-in. You can switch agency if something goes wrong.
It’s harder if you work with many specialist agencies though. They may not always work well with each other. The work may feel less integrated.
You’ll probably spend more on fees too. Each agency will need separate budgets and resource plans. This takes up more time and is harder work for you. More update meetings. More reporting and performance sessions. Specialist agencies won’t have the same broad view of your business as generalists do.
There’s also a final option where you use both types of agency.
For simple jobs like this, specialists are usually faster and cheaper.
Identify the type of expertise you need
Next, you identify the type of expertise you need.
It’s usually in one of these areas :-
- Customers :- You need help with market research; data and analytics, or behavioural science.
- Brand :- You need help with your brand strategy and positioning. Or to bring your brand identity to life. Or you need help with innovation.
- Activation :- You need help with your marketing mix. Promotion is the most common. But you can also get help with product, place and price.
Once you know the broad area, you define your more specific needs.
Type of agency - Customers
Market research companies
Qual research normally runs as a project to answer a specific research question. You often use the same research company to run each qual project. But there’s not usually a specific commitment to on-going work.
Quant research can also be project-based. But there’s also often an on-going element.
You’d do a quant research project to validate an innovation idea’s potential for example.But you’d do on-going research for brand health tracking, or measuring the impact of your advertising and sales promotions.
Working with market research companies gives you access to their research expertise. They do things which would be harder to do on your own. Recruiting respondents. Setting up questionnaires. Reducing bias in your research. Their expertise makes sure you get the most accurate customer feedback from your research.
Data and analytics
You use them when you have large and/or complex sets of data to manage.
You also use them for more advanced analytical approaches. For example, to run an econometric analysis on your pricing and promotions.
They use their expertise to look for trends and opportunities in the data. Their analysis can show you what’s working. What’s not working. And what you could do differently.
This type of agency could recommend specific segments to target for example. Or the best time to run promotions and what types of promotion to run. You use this expert analysis to improve the quality of your brand activation.
Behavioural science looks at how we make decisions. For marketing, it specifically looks at how we make buying decisions. The better you understand that, the more impactful your offer.
For example, they can advise how to make your copywriting more persuasive.
They can review your customer experience and recommend ways to make it better. They show you how customers make decisions, and tell you what to do about it.
Type of agency - Brand
You can use a brand strategy agency to help with your brand development process.
You brief them to create a new brand, or update an existing one.
This all usually happens at a workshop.
Your brand identity is a mix of intangible and tangible assets. It acts as your brand’s DNA.
Some agencies only deliver the intangible assets. You use designers to create the tangible assets.
But you can use specialist brand identity agencies who’ll do both intangible and tangible assets.
Doing both together helps your identity feel more consistent. Consistency’s important. It helps customers understand who you are.
For example, let’s say your positioning benefit is the high quality of your product.
Your values and personality would need to be consistent with that. That could mean for example :-
- values – craftsmanship and prevision.
- personality – attention to detail and persistent.
But you’d also need your tangible assets like your logo, colour palette and typography to be consistent too. It takes specialist graphic design skills to translate these intangible concepts into tangible assets.
Often, you also use them to show how to use your brand assets. How they should look on your packaging or your website for example. You collate all these assets into a brand book. They help you create that. It sets the rules on how your brand looks, feels and acts. That drives consistency.
These agencies are experts in the innovation process. They provide expertise at each step to help launch new products and services.
For example, creative thinking experts for idea generation and screening. Product designers to build prototypes. Financial planners to build business cases and launch plans.
Each new launch is a separate project. They work with you until the launch, and then it’s handed over to an activation type of agency.
Type of agency - Activation
Activation is the most common area to find and work with agencies. That’s no surprise. It’s where clients spend the most money.
It’s because most activation needs are on-going. You have multiple projects with this type of agency. They’re usually bigger and take more time to do.
The work you do with them usually relates to specific parts of the marketing mix.
Promotion is how you persuade customers to buy your brand.
You use it to move customers along the brand choice funnel. It helps you build trust, awareness, consideration, trial and loyalty.
Key areas where you often need agency expertise are :-
Advertising agencies work with you to :-
- develop the advertising idea.
- turn the idea into a compelling brand story.
- bring the story to life in your media channels.
Your media agency gets your advertising in front of the right customers, in the right channels, at the right time and place.
You rely on them to invest your media budget wisely. Customers need to see your advertising in the right context for it to work.
Their expertise makes sure that happens.
Digital / Social / CRM agencies
They focus on how to use marketing technology to connect with customers.
There’s many different ways to do that. These types of agency help you manage these connections.
They’ll often also offer to run your digital media. That usually covers search, social and display advertising to drive traffic.
You can also use them to set up your digital data system. They’ll help you track your online performance. And of course, they’ll create content for you. Your product pages, social posts, online sales promotions and so on. This is all part of your online customer experience.
Public Relations (PR) agencies
Public relations is another area where you often need an agency. It has different challenges to advertising, media and digital. That’s why it’s common to use a separate PR agency.
You mainly use PR to get media coverage. They bring specialist expertise to help you :-
- influence key opinion leaders.
- connect with journalists and influencers.
- run trade shows and exhibitions.
- stage one-off events like new product launches.
Most businesses create their own products using their own Research and Development (R&D) team.
But you may need a specialist type of agency for expertise the R&D team don’t have.
How different colour inks print for example. If boxes are strong enough to support products in transit. If the packaging is sustainable and recyclable.
You often need expert help with these questions. Specialist packaging agencies have that expertise.
You can also find agencies who specialise in product development. They’ll have design and engineering experts who can create prototypes. They’ll often also have manufacturing and process expertise. They can help you build an operations plan to see if your idea is feasible. To see if it can be scaled up.
You might also use a specialist agency to help with your product’s sensory development, if it’s relevant. Common examples include new food flavours, or new perfume aromas. Anything that impacts how a product looks, sounds, smells, tastes or feels.
Place normally refers to where you sell.
You can find agencies who’ll help you build your sales channel strategy and plan.
This can include building category plans to use with retailers. The outputs are similar to what brand strategy agencies deliver, but with a retailer focus.
Some types of agency can also help you with in-store activation. You use them when you run sales promotions with retailers.
For a fee, they set up your Point of Sale (POS) displays and place shelf stickers. If relevant for your category, they can also run tastings or events in-store. This is very common in the grocery channel.
They’re more reliable than using the retailer’s staff to set up your displays. Their field teams will visit stores at agreed times. They’ll re-stock empty displays. You use this type of agency to maximise in-store presence.
Similar agencies exist for e-Commerce. They help you sell through online retailers. You can use them to optimise your product pages on the retailer’s product information management system for example.
Price is a less common area to use an agency. But there are some areas where you might need an agency’ support.
It uses statistical analysis to work out the historic impact of price changes and marketing activities. The model then predicts the future impact of your price and activity plans.
Service Ps - people, physical location, process
Service based business often also look at 3 extra Ps – people, physical location and process. Specialist agencies can advise on how to improve systems, technology and ways of working in these areas.
Typically though, these types of agency come from outside marketing. A training agency to improve how your people work for example. An architect to improve your premises. Or a management consultancy to improve your processes.
Most of the same principles we’ve covered in this article apply. You work out what you need first. Then you work out if their expertise helps you meet that need. That’s how you decide if they’re the right type of agency.
Conclusion - What type of agency do you need?
Agencies have a big impact on how your marketing works. Which type of agency you choose depends on the type of problem you have.
Bigger and on-going problems usually means a generalist agency with multiple skills.
They look after multiple projects and make your life easier. But they can be slower and more expensive. And there’s a risk you become dependent on them.
Smaller, specific problems means a specialist agency. Their expertise focuses on a specific area.
They’re often faster and cheaper on smaller, less complex jobs. But if you have too many of this type of agency, it’s harder for you to manage them all.
There’s also the option to use a hybrid mix of both.
Then you look at your specific needs. These usually focus on either customer, brand or activation. You choose the type of agency based on your need :-
- Customer agencies support you in areas like market research, data and analytics and behavioural science.
- Brand agencies help you build your brand. That can include your brand strategy, brand identity and specialist areas like innovation.
- Activation agencies bring your marketing plan to life. They help you deliver the 4Ps of your marketing mix.
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