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Alaniz Featured in The Drum: Full-service v. specialty agencies: Which one reigns supreme?

By September 5, 2017June 18th, 2018Alaniz Media Coverage

This article was originally featured in The Drum.

Like precious snowflakes, each brand and agency is different, so – spoiler alert – there isn’t a definitive across-the-board answer about whether it is best to work with full-service or specialty agencies.

In fact, like so many things in life, with the necessary caveats, of course, the ideal arrangement, broadly speaking, may lie in a healthy compromise between the two — or what I’d like to call the Hannah Montana Approach. But more on that in a minute.

Citing entrepreneur Jim Barksdale’s “There are two ways to make money in business: You can unbundle, or you can bundle”-quote, Mark Mulhern, president of the east region at digital marketing agency iCrossing, said digital is likely the reason things unbundled as much as they did in the agency world – and is also likely a reason they are rebundling now.

“In the beginning, digital was new and separate and a different set of skills that needed to be addressed by specialists,” he said. “But now fast forward to 2016/2017 and…everything is happening…in the digital funnel and there is real value in a client having one partner who understands every phase of that.”

Which brings us to the first real advantage to working with a full-service agency:

It’s easy.

In fact, Bill Peatman, senior content strategist at Alaniz Marketing, said full-service agencies are often a reliable choice.

“When I worked at Cisco Systems, sales people used to say, ‘Nobody ever got fired for choosing Cisco,’ for their networks,” he said. “Cisco may not have the absolute best of breed in every product category, but it is a market leader and a safe choice.”

In other words, it’s the hey-we-could-do-worse approach.

And that safety can be appealing in an increasingly complicated environment.

But that’s not to say a full-service agency is an uninspired choice. For one thing…

It provides a holistic view.

That’s because single agency can survey all channels – and data – and make informed decisions for its client.

Indeed, Gina Rodriguez, digital marketing specialist at full-service agency Keenability, said full-service agencies like her own can impart a holistic view.

“It benefits the client in the long term since they are able to have fewer account managers and people to email…,” Rodriguez added. “Not only does it make it easier for the client, but also for the agency — especially if the agency manages the website as the SEO team, social media manager and content writer all need to work in sync with one another to be successful. A marketing team functions much better as a unit and provides an all-in-one solution while maintaining a diverse group of talented individuals with different disciplines working together to ensure results.”

It’s only as good as its worst department.

However, Alexandra Golaszewska, founder of marketing agency Helios Media, said despite this simplicity, working with a single agency is only a good solution if the agency is good at all of the services it offers — and that isn’t typically the case.

“It isn’t uncommon for an agency to have one thing — or maybe several — at which [it excels] and then to offer other services because they think clients want to get everything in one place. It doesn’t mean that they’re equally good at all of those things,” Golaszewska added.

Ed Baxter, search manager at digital agency Evoluted agreed, but noted there is usually less friction and more communication between teams within a full-service agency.

It maintains consistent messaging.

In addition, working with a full-service agency means a brand has a single mouthpiece for messaging on every platform. And, per Evan Berglund, senior partner at the Gonzberg Agency, this is valuable as consumers move seamlessly between channels and expect to see the same message at all relevant touch points.

It depends on size.

But the decision may also hinge on the size of the brand in question.

For his part, Jason Brewer, CEO of digital agency Brolik, said small- to middle-market companies with marketing departments of three people or less generally benefit most from a full-service agency that can “educate, be flexible and grow with their client, taking care of diverse needs across all facets of marketing.”

On the other hand, larger brands are better served by specialized agencies, but “only if they can handle the overhead of managing the communication and delegation of multiple [agency] relationships and the challenges that come from a fragmented agency structure,” he added.

Relationship management can indeed be a headache.

In fact, Laura Sheridan, president of brand strategy and search firm Viva La Brand, conceded managing multiple agencies “can be a nightmare.”

“Taking a best-of-breed approach to managing this consumer experience will invariably lead to what can be described as fiefdoms of expertise,” Berglund added. “Within each fiefdom, there will be talent and management who believe their specific expertise represents the most important aspect of the customer journey. This, in turn, makes it unnecessarily difficult — and sometimes very costly — to devise and execute the integrated, cross-platform, communication needed to compel customers in 2016.”

What’s more, Berglund said an executive in a full-service integrated agency will have a much easier time rallying the agency’s departments and talent than a CMO will have trying to bring together a “collection of fiefdoms.”

For those parties who opt for specialty agencies, Sheridan recommended “clearly [communicating] that you expect that all of your agencies work together” during the search process and conducting regular meetings thereafter.

Ian Smith, vice president of production and accounts at digital agency Xivic, too, noted a brand working with multiple agencies has to be transparent with each agency and ensure the agencies are transparent with each other.

“The brand will have to unify each agency’s expertise and create a collaborative team willing to work together,” Smith added. “Expectations will have to be set and clear communication of objectives, assignments and responsibilities is a must. Knowledge sharing is key from all parties. This is no small job, but if done correctly, collaboration across the board will enable every agency to deliver the best quality performance possible.”

It works best with partners.

And then there are those who advocate for full-service agencies with an asterisk – with the asterisk being partners to supplement the agency’s deficiencies. Call it the Hannah Montana approach — as in, Best of Both Worlds.

That’s precisely what Kevin Buerger, executive vice president and managing director for the US of boutique agency Jellyfish, argued.

“This allows one agency [and] the advertiser to own the overarching strategy and having each of the specialties to work within that environment,” Buerger said. “I do not believe that it makes sense for advertisers to lean on a full-service agency for everything when that agency may be really strong in some areas and not so much in others, but gets the business because it is the simplest.”

Peatman, too, said it’s rare to find an agency that excels in every aspect.

“Mastering SEO, mobile search and social networks requires far more than a Don Draper,” Peatman said. “You have to have specific technical expertise and have to be exponentially better than what’s currently ranking to get to the top.”

As a result, he said a better model might be the general contractor model — in which a brand hires a lead agency that has a network of subcontractors that perform specialty services with specialty skills.

“An agency would probably gain a lot of credibility if it admitted that it doesn’t have the ability to keep up with the latest Google algorithms and mobile technologies, but it has relationships with [specialists] that do,” he added.

Juan Zambrano, co-founder of marketing agency Firewood Marketing, advocated a similar approach.

“In the Bay Area, we’re seeing a new embedded model gaining popularity both in startups and in established, global tech brands. In this approach, team members with specific expertise are brought in-house to work alongside the brand’s own team,” Zambrano said. “While the brand gets the benefit of working with specialized talent…they’re also able to maintain a single point of contact. The marketers can work flexibly and creatively, while partnering with brand employees. With strategic planning emerging as more of a priority than ever, this type of deep collaboration is becoming critical to marketing success.”

In fact, Kerry Jones, associate marketing director at content marketing agency Fractl, too, said many full-service agencies outsource to a specialty agency for skills and resources they don’t have or aren’t strong in-house – sometimes even when the client doesn’t this was happening.

This is all crazy talk. Specialty agencies are clearly the way to go.

But it’s the very reason that an agency cannot likely be all things to all clients that compels Shaun Walker, creative director at ad agency HeroFarm, to argue on behalf of specialty agencies.

They’re cheaper.

The Goliaths of the agency world “have a lot of overhead…which means higher/inflated billings,” Walker added. “You can’t have that big building with a fancy reception area and cool aspects you tout on your website without charging the higher end of the industry ranges.”

Smith, too, said the multi-agency approach means “each individual specialized agency tends to have the ability to develop a highly capable staff of experts within a specific marketing channel, offering hyper-focused efforts at competitive professional services fees.”

They won’t try to up-sell you.

And per Sheridan, specialty ad agencies are the solution 90 percent of the time in part because they gather data on very niche topics.

“Their clients benefit by being able to apply the agency’s learnings,” she said. “Full-service agencies are typically busy cross-selling their services rather than being true experts in any particular area.”

They’re nimble!

And smaller specialty shops can also make decisions and move quicker than their larger counterparts, which can take hours or days to respond.

“There also usually isn’t a phone tree or multiple people to go through before reaching the person you’re trying to contact, meaning the service provided by niche shops is more personable, efficient, and costs less,” Walker added.

Then again…

At the same time, Jon Paley, CCO and managing partner of ad agency The Vault NY, said if a brand works with just one shop, chances are it has nothing to do with getting the best work that yields the best results but is rather because they are “lazy [and] overly bureaucratic and therefore can’t get anything else approved…or there is a relationship that goes so high you can’t even see it.”

Lisa Lacy

Lisa Lacy is a senior reporter for The Drum, covering digital and search marketing. Based in New York, she writes about how brands use technology to connect with consumers, particularly as innovations like voice search, digital assistants and the Internet of Things change consumers’ lives forever – not to mention the data these platforms increasingly collect and the security and privacy issues therein. She is a graduate of Columbia’s School of Journalism. Her bucket list includes riding in the Oscar Mayer Wienermobile.