Why agencies’ biggest problem is their business model

Oh boy. “Agencies’ fee-based business model hasn’t evolved in decades — and that may be a significant factor in the industry’s struggle to manage costs. With clients suppressing fees, asking for longer payment windows and seeking more project work, rather than long-term relationships, agencies may need to reimagine their business model.”

Mmmkay. And how might we do that?

“They have grown up and grown able to adapt and work with a project-fee situation. They also tend to play in capabilities and categories that are more highly desirable and paid for, digital specialties, programmatic, search, performance, digital experience development. These are execution-style capabilities that clients are willing to pay for.”

Ok that’s not as stupid an idea as I had expected when I went in BUT you can’t project out a $100M+ global account. There’s not cohesion and no integration – literally the opposite of what we try to use the holding company model to do.

Add a Comment

Your email address will not be published. Required fields are marked *