Underscoring the age-old gulf between client/agency relations, a new survey by Forrester Research provides empirical evidence that marketers increasingly wonder whether the efforts of their advertising agencies are all that effective.
Furthermore, agencies overstate the roles they play in achieving client goals, as evidenced by the study’s finding that only 63% of marketers feel agency contributions drive marketing success, as opposed to almost all of the agencies queried (93%) who feel that way.
In October and November 2006, Forrester surveyed 141 marketing and advertising agency executives from the market research company’s ongoing marketing research panel, as well as members of the American Marketing Association, to measure attitudes towards agency effectiveness.
The resulting report, “Help Wanted: 21st Century Agency,” found that 76% of marketers do not measure the return on investment of their lead agency relationship.
“Without measurement, marketers cannot hope to manage and improve performance,” wrote Peter Kim, the report’s lead author. “Marketers must gain the ability to measure the ROI of all marketing investments, not just agency work,” he added, citing an anecdote of one unnamed marketer, who admitted, ‘We are only now beginning to measure our return on programs we implement.’”
Kim said he’s not suggesting that marketers would better off going at it alone. “No doubt marketers need agencies. But it’s as if both are in the car, and neither has a map [to ROI]. How are they going to get there?”
Part of the problem is that many agencies aren’t as well rounded as they pretend to be in the 21st century, and it behooves client and agency alike to tap organizations that specialize in the constantly changing digital media landscape, believes Forrester.
“Marketers aren’t convinced that their agencies can formulate new media strategies, and agencies aren’t fully convinced themselves,” the report said. “Huge gaps exist between marketer and agency perceptions of ability to deal with changes in TV, Internet, and consumer generated media.”
As an antidote to the reality that consumers generally hate ads, Forrester [http://www.forrester.com] urges a shift to client-centric and consumer-centric, integrated marketing that engage and activate customers. “If not, advertising will continue to suffer in an environment rife with consumer mistrust of corporate messaging.”
The report cites promotion-related agency blunders that resulted in public embarrassment, including Wal-Mart’s fake blogs, GM’s Chevy Tahoe/Apprentice user-generated ads, and Agency.com’s viral video pitch for Subway.
Forrester’s panel used for the survey consists of volunteers who joined on the basis of interest and familiarity with specific marketing topics. For quality assurance, panelists are required to provide contact information and answer basic questions about their firm’s revenue, advertising budget, and management processes.
Respondents had the incentive to participate by getting access to the survey data. Companies interviewed for the study included: Ammo Marketing, Avenue A | Razorfish, H&R Block, Hill Holliday, JWT, Kia Motors, Sheffield Marketing Partners, and Xerox.
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