Can We Redefine Business Development?
January 10th, 2017 by George Sanchez
The Marketplace For Independent Creative Agencies Is Fragmented.
The business world as we know it is fragmenting at a pace unlike any we’ve seen before. Adam Smith first coined the term “specialization of labor” in Wealth of Nations, published in 1776. Fast-forward 240 years and the rise of digital technology and the democratization of maker and marketing tools has pushed us into an era of hyperspecialization that is recasting every industry on the planet. If Adam Smith were to rewrite his theory today, it would undoubtedly only become more extreme.
Not surprisingly, this trend towards fragmentation has spilled over into the market for top independent creative agencies, creating the long tail of agencies. The big-tent ad agency model — the one reinforced by shows like Mad Men, wherein a massive ad agency like Ogilvy, DDB or Leo Burnett controls the lot — is slowly becoming an acquisition-hungry concept of a bygone era. The reason is that scale does not necessarily translate to a great creative process or idea.
Whereas before there was only a set number of “go-to” places to procure the big idea, specialized creative boutiques — designed to solve specific problems — quickly, are sprouting up at rapid speed. These boutique agencies are providing big brands with deep pockets the potential to work with independent firms that cater to a brand’s specific opportunities and challenges.
This ability to both become and utilize a top-flight niche provider continues to challenge big agencies and makes brands reevaluate whether they should instead seek out these boutique providers. It has been said before, but the agency-of-record business model is showing its age.
The digital media industry, for one, has stepped up to take advantage and address the need for a specialized creative approach. Most recently, major media outlets like VICE and The New York Times brought creative and content studios in-house to address brands’ need for original solutions. This focus on niche has also very quickly translated to value creation. For example, digital publisher Refinary29’s most recent fundraise pegged its value at $500 million.
This democratization of information and fragmentation also has implications for where and how the top-tier creative talent prefers to work. As a recent New York Times article made clear, even young creative talent that once flocked to big agencies are nowadays more often turning elsewhere. The same is true for more senior talent who look for more independence and less bureaucracy.
At 49co we believe there is absolutely a more stable, efficient marketplace alternative – one where top independent agencies can better thrive and brands can have better access to the best talent. Initially, this marketplace will not be perfect. It creates new challenges for brands who, instead of turning to one of a handful of partners, need to carefully match their problems with a larger pool of smaller agencies. Independent creative agencies too will need to make collaboration a core competency and create the uncommon partnerships among themselves that lead to uncommon results.
We All Need A Trusted Curator
At 49co we believe in and love great design. However, we know our own strengths and are certainly time constrained. Therefore we are not about to walk into every specialty shop in NYC looking for unique pieces of décor, art or travel packages. Rather we trust design-focused curation sites, including One Kings Lane, Art Space and Design Hotels, to help sift through the fragmentation and save time and money in the process.
We also believe the opportunity is now for business development professionals to be the equivalent trusted curator in the marketplace for top independent agencies. They have the ability to offer up the exact creative rainmakers brands need to maximize business value – all in real time.
Why? This new landscape of working with independents is uncharted water for many brands accustomed to solely interacting a “full-service agency” or default to their personal network or approved procurement list to source a top independent, boutique firm. An informed, strategic and trusted biz dev pro can better connect these two worlds and become an essential link in their brand relationship’s business model. Curated access to these specialized firms becomes no more than an email or phone call away. With a growing assortment of specialized partners, there’s more than ever a need for people and mechanisms to curate the right set of agencies with which brands should be interacting.
Biz dev pros can bring transparency to the process and make a strong business case along the way. From a financial perspective, the larger agencies often outsource the brand’s niche needs to boutique firms, charge a markup in the process and have their large overhead funded by their clients. Instead, this new model creates a direct link between brand and the correct creative tastemakers with the on-demand component and low overhead adding increased efficiency. Most importantly, if the talent is world-class, the brand has maximized its investment in the brand along the way.
This effort also supports entrepreneurial, job-creating agencies in landing meetings and deals with the brands they are best fit to serve. The biz dev pro becomes a connection to opportunities that would not come otherwise, no matter how talented or connected the agency principals. In this way, biz dev pros can fundamentally shape the future of work for themselves and like-minded creative firms. Like Uber, this structure allows independent firms (cars) and biz dev pros (drivers) to function effectively outside large inefficient bureaucracies (taxi companies). This new model also provides the biz dev pro with a more diverse product offering to sell to their brand relationships, monetizing their network to the maximum.
If you are a biz dev pro within the creative world, it has never been a better time to step up and become independent. By curating top-flight boutique agencies and leveraging your relationships with brands, you become the trusted advisor in this hyper-fragmented marketplace.
Get out there. You will find you are desperately needed.