Why should I hire an Interactive Agency if I already have a full service one?

I’m repeatedly asked this question by marketers. Moreover, I recently had the need to help building the case internally for one of the contacts I met with at a leading global player. I was surprised I was not able to find supporting articles online, as my initial idea was to provide third party justification. Therefore I decided to go ahead and give it more thought and write about it here.

This topic is somewhat related to the post “Half the money I spend on advertising is wasted” as well as “Online, for the offline’s sake” one. Over and over again, brands conduct agency reviews, including everything in a single package. This is particularly true in the US Hispanic Market, where the inception of dedicated Latino marketing departments is relatively recent and their budget is considerably tight. They are building their case internally, to growth their capacities and resources.

As I tried to identify myself the reasons why this is so common, the fact that marketers might feel more comfortable with traditional agencies, as that is a ground they are familiar with and been experiencing for years, came to my mind. On the other hand the prospect of working with a single vendor might contribute to think this is the best way to go.

However there area several logical and not so evident reasons why brands should relay in traditional and digital agencies:

• Specialization: this is they main reason among all. The nature of the digital media requires significantly different skillset. Technology might arise as the first one, but the characteristics of the media it self cry for a different approach. Interactivity is the key component that is not present on the offline media. The tracking capabilities, the message customization, campaign targeting and dynamic content are other concepts that the traditional media lack of or are particularly difficult to implement, without entering into the cost arena.

• Business Relevancy. Online budgets are usually 5% of the offline ones, therefore a traditional agency winning a particular brand’s advertisement business will mostly, and usually do, focus on the offline side of the account, leaving online to play a secondary role, as collateral to all the offline activities and not as one of the key components.

• Resources. Most of the traditional agencies end up outsourcing the production of online materials to small shops or freelance developers/designers. So what is the point in awarding this slice of the business to them anyway?

• Innovation. Traditional agencies tend to follow the market on the implementation of digital strategies and not the other way around. Most of the offline agencies’ work on the digital media tends to be isolated from other actions, limited to very nicely designed minisites, a banner campaign and email blasts.

• Customer segmentation. And this point applies particularly to the US Hispanic Market & Latin America market. Consumers that have internet access are usually more qualified as consumers than those who do not. The demographics of online users have a tendency to be more educated and with higher income levels. Other audiences that are remarkably more knowledgeable on the online are the younger audiences, that becoming less and less receptive to traditional advertising methods.

I could keep citing more reasons why separating the online and offline advertisement accounts is as important as the selection itself fo the most appropriate agency. One of the additional reasons could be the consumer generated content trend along with viral marketing, that are centered on the web 2.0 but that deserves a completely separated discussion.

Let me get this straight, I’m not against traditional agencies or media, my position is that both, offline and online, should play a relevant role and that there should be a high level of interaction between the two of them on a particular account, to make of this a successful model.

Summarizing, on my personal experience, those accounts we work with, that previously had only a full service traditional agency, were in an earlier stage of adoption of digital media, lacked the required knowledge to implement comprehensive relationship marketing programs or even integrated campaign and tracking of call to actions. Moreover, the level of accountability of the dollars spend is usually lower on the offline side of the business, where metrics are not based on a one to one measurement and mostly related to statistical estimations. Making it harder for marketers to build the case for more budget and resources.

Marketers thinking on putting their account in review, should consider separating the offline and the online business, creating a competitive environment where creativity will keep flowing and the comfort zone for neither of those agencies will be reached.