Many ad agencies serving b-to-b clients are restructuring their services to address changing client needs in this lagging economy. The changesâwhich address areas such as consulting, creative and integrated marketing communicationsâreflect clientsâ tight marketing budgets and their need for measurable campaign performance.
Last month, b-to-b agency Doremus & Co. (part of the Omnicom Group of Cos.) restructured its business in an effort to more closely align its services with the needs of recession-shocked clients. The agency reorganized into three core units: strategic consulting, creative expression and orchestration.
"We are evolving our business proposition beyond b-to-b into c-to-câcorporate-to-culture," said Carl Anderson, CEO of Doremus.
He said the restructuring was designed to help the agencyâs clients work with limited resources to more effectively reach their target audiences. "Companies have to do more with less," Anderson said. "They have less money to spend, but they still are being asked by management to deliver results."
Anderson said the reorganization represents a change in the mindset of how the agency approaches its clientsâ business challenges.
"Weâre looking well beyond advertising," he said. "This is about corporations connecting with their cultureâinternal audiences, shareholders, prospects, everyoneâso anything they do as a corporation and everything they say reinforces the brand."
The strategic consulting unit helps clients examine their business strategy and brand strategy, and creates a "brand platform" on which to build an entire communications strategy. The orchestration unit will take the brand message across multiple vehicles to reach the clientâs core audiences. The unit will use Omnicomâs network of resources in addition to the Doremus account management staff.
Communication is key
McCann-Erickson San Francisco, which is the agency of record for Microsoft Corp. and other large b-to-b clients, over the past year has adopted a more holistic approach to serving clients, driven in part by the tight economy.
"You have to be more closely in tune to what your client is facing," said Michael McLaren, the agencyâs executive director of client services.
"As advertising as a percent of the overall communications spend has plateaued, the need to communicate with the customer is greater than ever," McLaren said. "Instead of looking through a narrow advertising lens, we need to structure ourselves in a way that facilitates a holistic view."
For example, in April, McCann hired Brian Powley as senior VP-director of business development; Powley has a background in integrated and online marketing. McLaren said it was important for the agency to have a person leading business development who did not look at the world with an advertising-centric view. Powley works jointly on business development for McCann and its relationship marketing company, MRM Gould.
All disciplines represented
Now, in addition to bringing in top creative, media and planning people at the beginning of an account assignment, McCann calls on executives from relationship marketing, interactive, strategic branding and other key disciplines that might be involved in the marketing communications mix, rather than adding them later in the process.
"In the old world, we would string along extra people as needed," McLaren said. "Now, we bring in senior people from the start and make them accountable for the solution," he said, referring to relationship marketing, interactive and other cross-discipline executives.
Gary Stein, marketing and advertising analyst at Jupiter Research, said, "Now that the ad recession looks like itâs over, agencies are looking to reform their [account] teams."
Stein said agencies are changing not just the organizational structure of account teams but also how theyâre compensated. In the past, he said, many agencies billed on an hourly basis for account service work; now, theyâre using account executives to grow new business and strengthen relationships with clients, not just rack up billable hours.
"What was normally a billable task is now spun into more of a service, and the revenue is expected to be generated by new business," Stein said.
"The agency will look at this position [the new role of account executive] not just as a revenue center, but as a client partner to organize the efforts of the team and really understand the clientâs business," Stein added.