Digital Gabe
Cutting Edge Commentary On All Things Media

Could We Be Looking At A Post HoCo Era?

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Over the weekend I posted an article about the changes coming to agencies and referenced the abrupt departure of WPP CEO Sir Martin Sorrell as a potential catalyst for change.  A few readers pushed back on this idea, suggesting that I’m over swinging to connect an individual’s personal misconduct with an entire industry’s shifting power dynamics.  Fair enough on the opposing opinions.

Then I came across this Digiday article which takes my supposition several steps further.  The piece is an articulation about why the Holding Company concept may have outlived its original intent.  The primary HoCo rationale was always about delivering cost efficiencies to clients by combining the back ends of multiple agencies and also by flexing their buying power muscles from an aggregated client spend.  There were also other benefits promised, such as investment in new transaction and data tools which deep-pocketed HoCos could afford to make.  But a decade later the new capabilities have become upcharges for clients who ended up paying as much or more for their marketing work than they did before HoCos were around.

So what do you think?  Will HoCos continue to exist in their current capacity?  Before you answer it’s important to note that neither Digiday or I am suggesting agencies won’t exist – they will.  Agencies have been an integral part of the marketing function since the days of Don Draper, and they’ll continue to be relevant for as far out as my crystal ball can see.  We’re just talking about who owns the agencies.  Maybe it’s time to kick parents out of the party and get back to the bread and butter marketing work which created a great industry in the first place?!?


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