REPRINTED WITH PERMISSION
March 11, 2024
A-List & Creativity Awards 2024
NO. 3
Agency thrives with data prowess, edgy creative and no-markup pay model
By Jack Neff
Known is a rare agency grounded in data but growing with edgy creative and a fundamental difference in its compensation model—which includes no markups on costs—and puts all of its profit at risk if work doesn’t perform for clients.
With a staff of approximately 380, Known works for a growing roster spanning dozens of clients, adding 25 in 2023 alone. Among them are all of the biggest digital platforms, including Google, Meta, Microsoft, Amazon and TikTok.
If that’s not enough to prove Known has a place in advertising’s big leagues, it handled a campaign for the New York Yankees TV rights holder YES Network. And it’s a venture partner in a new hotel concept developed for client Universal Music Group.
The independent, employee-owned integrated agency has more than doubled revenue and headcount during the four years since data science and engineering firm Schireson Associates acquired strategy and innovation firm Blackbird and creative, production and social firm Stun and merged them into Known in February 2020.
Known has established an impressive track record in a short time, including launching TikTok’s first global brand campaign and the viral Ocean Spray campaign on TikTok. Known also put together the first all-civilian mission to outer space in 2022, Inspiration4, as well as a Netflix series that raised $250 million for St. Jude’s Children’s Hospital.
‘A whole different game’
“They’re playing a whole different game,” Nick Tran, former chief marketing officer of TikTok and now CMO of another Known client, FarFetch, said in a statement, “producing breakthrough creative across all channels that’s persistently optimized to engineer business outcomes.”
Last year, Known increased revenue by 6% to $132 million through a combination of getting more of its integrated clients to use more than one of the agency’s capabilities and reeling in those 25 new clients. They included Dick’s Sporting Goods, The Knot, FarFetch, Celebrity Cruises, Ubisoft, Nestlé, National Park Foundation, The Girl Scouts, NWSL, Toys ‘R’ Us, CW and Build-A-Bear. The agency also renewed long-standing relationships with more than two dozen other clients, including Sesame Workshop, Citi, PepsiCo, Hulu, Paramount, Shake Shack and Audible.
Known goes up against digital transformation consultancies such as Accenture Song on one side and top creative agencies on the other, said Kern Schireson, chairman-CEO of the agency. “Pulling this off really requires that we hold ourselves to a very high standard in each of our areas of focus,” he said.
While still growing at a healthy clip, Known is being more selective of late in how it grows, Schireson said.
Selective or not, the sheer scope of work for an agency its size is daunting. Among other things, the past year has seen it launch two of the biggest global creative campaigns in the entertainment industry—Max’s “The One to Watch” launch and the relaunch of free ad-supported streamer PlutoTV through the “Stream Now. Pay Never” campaign. Known also launched campaigns for FX’s hit series “The Bear” and HBO’s hit series “House of the Dragon,” including website and social marketing.
Also on its résumé last year: The “He Said YES!” campaign for YES Network around the Yankees’ long-term signing of star Aaron Judge and the “Meet America the Beautiful” campaign for LGBTQ+ dating app Taimi.
The latter, featuring a variety of beautifully shot portraits of LGBTQ+ people, was rejected by local media owners across red states.
“It was almost impossible to find a place to express the campaign in those states,” said Ross Martin, president and chief experience officer of Known, because media owners banded together to refuse placements. But, he said, “It became a rallying cry for the team to go find a way to do it anyway. And to their credit, and the credit of some of the out-of-home platform owners, they stepped up and also donated millions of dollars in media to counteract the ban.”
UMusic Hotels
Perhaps the most daring project for Known last year was launching a hotel concept in which the agency took a stake as a venture partner.
UMusic Hotels is a concept longtime client Universal Music Group asked for in 2020 that finally became a reality last year with the opening of a flagship location in Madrid as part of a joint venture with Dakia Hospitality and Known. It’s the first of what is planned as a chain of hotels globally inspired by the power of music and incorporating each city’s unique musical heritage. Plans call for five more hotels.
“Universal Music Group had the question, ‘What does our brand mean in the physical space?’” Schireson said. “We worked with them from the ideation phase.”
Known may be the ultimate example of a full-service agency, bringing together the shards of a specialization explosion from decades ago that many clients have since been trying to piece back together.
“We think when the parts are not connected, the client is the one who loses,” said Martin. “We don’t need to come in and do everything, though we can, and in some cases we do. Often we’re working with another agency or two, or more often than not internal teams. If anything, Known represents a moment of Pangea, where the continents of marketing capabilities come back together as one unified, aligned operating system.”
No margin, all incentives
The biggest departure for Known from other agencies may be its compensation model.
It is based on “complete transparency on pricing and hourly costs and a baseline fee structure that leaves us at zero margin, but gives 100% of our margin over to incentives that the clients set” based on their key performance indicators, Schireson said. That can be year-over-year revenue growth, cost per acquisition or some other marketing metric, he said.
Michaella Solar-March, chief marketing officer of Graduate Hotels, called Known “the most transparent agency I’ve ever worked with.”
The result is to align Known with clients, Schireson said, adding that it takes questions about margins, markups, kickbacks or arbitrage out of the equation.
“If you have a different outcome in mind than your client,” he said, “it’s probably not going to take you to a place that makes sense.”
Reprinted with permission from Ad Age. © 2024 Crain Communications Inc. All rights reserved.
Further duplication without permission is prohibited. Visit www.adage.com. AA24037