Bigger not better for ad agencies: Porter
NEW YORK (Reuters) - Advertisers are more interested in smart ideas from agencies than a full range of marketing services, leveling the playing field for small agencies to vie for top accounts, a leading industry executive said on Wednesday.
Advertising titans such as Omnicom Group (OMC.N), Britain's WPP (WPP.L) and France's Publicis (PUBP.PA) bought dozens of ad shops and media agencies in the 1980s and 1990s hoping to appeal to marketers, and investors, with a complete marketing solution.
But Chuck Porter, chairman of boutique agency Crispin Porter + Bogusky, said such large marketing services companies with far-flung networks have fallen short of their promise to provide one-stop shopping for advertisers by combining creative work, media services and research under one roof.
"You don't need to be big. You could be two people in a Starbucks sketching ads on a napkin and you could be successful," Porter told the Reuters Media and Advertising Summit in New York. "Ideas are really way more important."
While the biggest ad firms continue to post solid revenue growth each quarter, smaller, stand-alone agencies have shown more success recently in wresting big accounts with the appeal of unconventional marketing ideas.
"Those rollups were never about the clients, they were financial plays," Porter said. "In this business, the moment you bundle things at the top ... that day it starts to unravel at the bottom."
In the past few months, Crispin Porter won advertising work for automaker Volkswagen of America from Havas Advertising (EURC.PA) agency Arnold Worldwide. Independent shop Wieden + Kennedy took the lead on advertising for beverage giant Coca-Cola Co's flagship cola from a WPP agency.
Crispin Porter had earned a popular reputation for edgy ad work on behalf of Burger King, particularly for its "Subservient Chicken" Internet campaign, and is part of Canada's MDC Partners Inc MDZsva.TO network.
Porter said the shift occurs as other marketing services are increasingly commoditized by more sophisticated technologies for planning and buying advertising time.
"Four-to-five years ago, the normal questions (from clients) would be -- tell us about your global capabilities and experience in this field," he said. "Now they say, what have you done that is innovative, what nontraditional media have you done?"
