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Advertising Agencies: Are Digital Agencies the Way of the Future?

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Last week we explored the origins of advertising agencies, and how the rise of the digital agency has transformed the industry. Today we highlight why marketing technologies are important to top advertising agencies, and showcase the work of some great digital agencies.

To recap, digital agencies came into play as early as the 1990s but really started to make waves in the early to mid-2000s. The internet and sudden outbreak of social media opened up new channels of advertising for marketers to conquer. Brands that previously relied on traditional methods of advertising (radio, TV, print) needed to infiltrate the digital landscape in a strategic way and do so FAST.

Why are digital agencies so important now?

The Digital Agency specializes in developing, planning and executing strategic advertising campaigns by uniting marketing and technology. These agencies offer digital expertise and make it their mission to seamlessly integrate brands’ traditional media properties into the digital space using technology.

Statistics show that for agencies, digital work continues to grab share from non-digital work:

  • In 2014, US spend on digital media accounted for 28% of overall media spend of $179.8 billion. This is predicted to increase by 15.5% in 2015.
  • Compared to just a year ago, 81% of agencies are more interested in digital advertising. In fact, 41% of agencies foresee increased digital ad spend as the biggest change coming to the advertising industry in 2015
  • U.S. advertisers’ spend on digital advertising is predicted to overtake spend on TV advertising in 2016
  • It’s predicted that by 2019, digital will represent 36% of all US ad spend budgets


Digital Agencies Understand the Importance of Marketing Technologies

Part of the refocusing of the advertising industry towards digital has also resulted in a surge of marketing technologies. We know that the marketing technology industry is growing exponentially every year. The smartest companies evolve with these changes by adding relevant new technologies to their marketing stacks to better strategize their campaigns.

Digital agencies have a head start on other ad agencies because marketing technology is immersed in their culture and seen as essential to success. The best digital agencies ensure marketing technologies, like competitive intelligence tools, are in their marketing stack as well.

With competitive intelligence tools like WhatRunsWhere, agencies that deal with display advertising are able to make smarter media buys because they’re fully informed of the successes and failures of historical campaigns. This gives them an immediate edge over the competition, resulting in increased ROI for clients.

In addition to competitive intelligence tools, digital agencies can also leverage programmatic advertising technologies to further enhance campaigns. These are tools, like RTB platforms, that automate the process of online media buying using programs to pre-set rules and algorithms. Marketing technologies like competitive intelligence tools help the best digital agencies better understand the digital space and in doing so, allows them to make more informed decisions, ultimately leading to dollars being well earned, not just spent.

There are various types of digital agencies emerging in today’s world:

In-house Agency: although this existed before, companies are now realizing the importance of having an in-house team specializing in digital campaigns. Having an in-house team allows for immediate notification and action vs. having to wait for an external agency to discuss options with the company.

Netflix is an example of a company that has an in-house team working on digital advertising projects. They recently moved their programmatic ad buying in-house.

net

How they’re #doingitright

  • The right strategy: According to Netflix’s Senior Manager for Programmatic Buying in North America, Kathy O’Dowd, the strategic method to programmatic advertising requires testing and learning. An approach, she claims, that is often approached better by an internal marketing team than an agency. The company is aware that they have better resources internally to execute this type of digital advertising vs. outsourcing to an agency; making their investment in programmatic advertising more efficient.

 

  • Multi-channel learnings: Having an in-house digital agency can also be beneficial as you can apply learnings from across all channels of marketing to ensure you have a fully integrated strategy. By bringing programmatic advertising in-house Netflix is reducing the risk of isolating this channel from all other marketing efforts executed by the company.

 

Social Media Specialist Agencies: Stats like these exist: “Every second, two new members join LinkedIn.” In fact, “the top three social networks used by B2B marketers are LinkedIn (91%); Twitter (85%); and Facebook (81%),” and “Youtube reaches more US adults aged 18-34 than any cable network.” It’s no surprise that digital agencies specializing in all things social media have emerged. Even more recently are agencies that only focus on one social media platform such as The Mobile Media Lab that solely works on brand strategies for Instagram.

The Mobile Media Lab helped Expedia launch their Instagram account by integrating their “Throw Me Back” campaign, being activated on other media channels, with Instagram.

xped

Method: They had 3 popular Instagrammers post 10 photos related to the “Throw Me Back” campaign

Results: 10 photos
 = 10 000 Interactions
 + 2000 new followers (doubling their audience)
 + Thousands of #throwmeback submissions!

How they’re #doingitright

The success of this Expedia campaign can be attributed to The Mobile Media Lab effectively using Instagram’s features (easy hashtag + popular Instagrammers) to roll out this already existing campaign in a new channel.

For social media campaigns to be effective, marketers need to understand how to leverage features on each specific platform vs. trying to do the same on each and hoping for different results. Clearly this is something The Mobile Media Lab is doing right.

Experiential Agencies: this kind of digital agency focuses on combining the digital world with the physical world to create an unforgettable experience. Not only do their campaigns bring consumers an unforgettable experience but they also provide brands with a touch point to engage with these customers in the future.

Razorfish is a leading digital agency that is pumping out innovative ideas. One of their projects involved a Mercedes-Benz car race that was fueled by Twitter. Literally, the racers could only use the amount of gas that was proportionate to the volume of tweets they received. The campaign generated more than 150,000 tweets from 21,000 users.

razor

How they’re #doingitright

Racing luxury automobiles is often something left to the professionals, that is until Razorfish decided to get fans involved in the experience. This campaign gave consumers the chance to participate in a thrilling physical event by simply tweeting. As the race took place, Razorfish also promoted the race’s hashtag via promoted tweets and promoted trends.  

Since Razorfish had to track the campaign activity in real-time, they were able to leverage the hashtags and tweets being generated during the race to further promote it. Now that sounds like a #winning strategy.

Kurt Noble is a San Francisco based digital agency that is dedicated to creating extremely unique interactive experiences using technology.

dream panda

Above is a visual of a touch-screen application Kurt Noble created for DreamWorks Theme Park for children and adults to create and animate their own Kung-Fu Panda characters. The characters created were linked to park wristbands, worn by guests. The wristbands have park-wide user tracking capabilities, allowing DreamWorks to track the activities and achievements of visitors. Talk about staying connected!

How they’re #doingitright

This project demonstrates how a company can use an experiential project to connect with their customers post-campaign. The key to success in this Kung-Fu Panda project is the link to the guest wristbands. This extends DreamWorks ability to interact with park guests even after they are done interacting with the touch-screen application. Which means more opportunities to learn about their customers and advertise to them based on these learnings.

Display Advertising Agencies: Some agencies also engage in display advertising projects or specializes in this. Jellyfish is an agency that worked on a display campaign for TIME Magazine using banner ads to channel potential subscribers through a new conversion funnel. The success of the campaign is likely attributed to the following:

  • Attention to detail in creative: Jellyfish ensured the visuals were consistent with Time Magazine branding so the banner ads did not look out of place.
  • Ensuring ads were optimized for all screens: Jellyfish used responsive design so that the banner ads were specific to every device format the magazine could be accessed on (tablets, mobile devices and desktop)

time

The results? This display campaign resulted in a larger number of click-throughs to the new conversion funnel (compared to previous conversion funnel) and therefore a higher number of conversions for Time Magazine. 

How they’re #doingitright

Jellyfish is clearly able to identify the appropriate mix of data, technology, creative and context when delivering display advertising. By successfully combining these factors they are able to produce not only effective, but memorable display campaigns as well. Now, if Jellyfish also used competitive intelligence tools, like WhatRunsWhere, they could have additionally reduced testing times while simultaneously increasing ROI. 

Why should you consider a digital agency?

They see digital as a priority. Consumers today are always on the go and often not without their digital device(s) on hand. While your staff may still be trying to understand the digital landscape and digitally empowered consumers, a digital agency is fully immersed in it and can suggest the best possible solution for your strategy.

Successful integration and multi-channel promotion: digital agencies have to not only be experts in digital advertising but also have the ability to seamlessly integrate all elements of marketing including any TV, radio, print or any other channel of promotion.

The proof is in the pudding: Marketers are shifting their advertising spends to the digital space so why not work with an agency that can leverage these dollars to deliver an optimized digital strategy.  

They can specialize within the digital realm. Various kinds of digital agencies are emerging that can focus on specific areas of digital advertising. For example SEO, display advertising, social media – the list goes on and on.

So What’s Next?

It’s clear that there is a new kind of advertising agency in town, shaking up the ad world.

Given the endless opportunities presented by marketing technology including competitive intelligence tools, these agencies are always on the cusp of innovative ideas that help their clients succeed. They’re bringing consumers that much closer to their favourite brands through an intimate online experience.

Now you have a clearer understanding of digital agencies and their prominent place in the advertising industry today. But let’s talk about how their use of competitive intelligence tools like WhatRunsWhere sets digital agencies apart. Stay tuned for our final installment on Advertising Agencies, when we focus on how digital agencies use competitive intelligence to gain an edge, and prophesise the future of digital marketing.

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2 thoughts on “Advertising Agencies: Are Digital Agencies the Way of the Future?

  1. Pingback: [Infographic]-Advertising Agencies: Past, Present & Future

  2. Pingback: Why The Best Agencies Use Competitive Intelligence

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