Client In-Housing Puts The Squeeze On Madison Avenue
There’s an emerging trend of large national advertisers taking more of their marketing work in house. As explained by Digiday, this is reducing the role of traditional agencies who have less and less work to do.
Interestingly agencies are still receiving plenty of “project work” assignments as clients look for niche areas expertise to help with specific parts of their marketing plan. The real squeeze is coming from umbrella Agency of Record relationships. Brands are less likely to sign on with an AOR on the thinking that they can manage their overall marketing strategy, and instead hire subcontractor agencies to handle specific projects. This is actually great news for agencies who’ve developed expertise in areas like data management, programmatic, martech, social and search. However it’s not such good news for Holding Companies and their stable of agencies who are used to providing end-to-end marketing services for their clients.