So we ran a piece in Adweek Wednesday in which the head of a major international consultancy commented on current trends in agency reviews.
In short, principal Greg Paull of R3 said we can expect more reviews to come on the creative and media sides of the business.
Here’s the key section:
“Reviews are up and revenues are down for creative agencies. The basic topline: more are circling for less and less business. It’s proving to be a challenge for these large agencies of record as more clients look to build a roster. They want that flexibility, because they’re under a lot of pressure to deliver … the days of the agency of record are in question.”
Paull also made some statements about the international creative scene that might prove provocative for our readers. First, check out this chart ranking global agencies by 2016 revenue totals:
We asked Paull about mcgarrybowen, and he said:
“The perception is that they’re in decline, but they have brought in some big wins [like J.C. Penney and United Airlines]. If you look at the full U.S. table, you’ve got agencies like GSD&M and VML who you wouldn’t expect to be in the top 10. It reflects the nature of marketers really seeking out fresh creative solutions.”
He was specifically talking about VML’s recent Wendy’s win. (The account had been with Publicis.)
Regarding Ogilvy, he said, “They’re not number one in the U.S. by any means, but it’s about diversity of markets. The OgilvyOnes and Ogilvy Actions/diversified services around the world have helped them … they have 20% of all wins. Some are small, but in terms of quantity they have been successful. It’s a similar point of view for McCann.”
He told us to expect more creative reviews in the next six months as clients look to expand their rosters by hiring more mid-size shops rather than consolidating with a single AOR. Paull pointed to GSK as an example and said we wouldn’t see too many massive wins like the AT&T BBDO consolidation.
And yet, despite this overall decline in revenue, Paull also told us that creative shops will continue to be key for many clients.
“Ideas still matter,” he said. “Agencies like Droga5, BBH and Anomaly are small compared to the big agencies, but they brought in big wins [like Beats by Dre]. As much as they talk about digital and data, marketers still shop around for the best creative ideas.”
So … slightly encouraging?