Part 3: Are Agency Org Charts Undermining Insight Accountability?
Posted on March 24, 2014
This is the third in a 5-part series examining potential fatal flaws in the traditional full-service agency model that focused on production silos instead of integrated demand marketing teams.
One of the observations that I have had in working with many full-service agencies in the past couple years is the lack of buyer insights and the concentration of campaign performance data with a select few internal agency departments (typically Account Service and to a lesser degree the agency partners). As I’ve mentioned many times, when things go wrong clients don’t fire agency departments — they fire agencies. The typical reason for firing an agency is lack of performance, not cost of services.
Encourage a Culture of Analytics
So how do full-service agencies ensure they are maximizing their performance? There are lots of ways from investing in modern technology, to hiring experienced marketing talent, to creating environments of innovation. For this post, I’m going to zero in on insights sharing to inform better decision making. One of the key challenges with silo production environments is that the performance data for each department tends to stay inside that department, except for data needed by the Account Service team to manage the client’s expectations. Often, Account Executives are required to gather data from various internal departments and extract meaningful insights that they can report to the client on such things as financial metrics (CPL, CPA, ROI), conversion metrics (CTR, CVR) and engagement (downloads, shares, likes, subscriptions, views, etc.) As long as the AE’s are exclusively responsible for insight extracting and reporting then the departments that feed this data to them have less “skin in the game” for having to understand their own data insights. The ability to spot trends and course-correct campaigns is important as today’s client marketing teams now live in a world of real-time data analytics.
Better Insights Can Lead to Better Results
Performance improvement tyipcally comes when you analyze data, extract meaningful insights, and apply the insights to decision making to improve results. While a PPC analyst can export AdWords data and report on general trends in CTR, CVR and CPC — going beyond the data to make recommendations on performance optimization is critical. To the extent, the agency can create a culture of insight extraction and application (not just running a bunch of mindless data reports that clients won’t read anyway), the agency can really improve its client results.
Last year, I remember having a seasoned PR professional inside an agency confess he didn’t know how to navigate a Google Analytics report or how to use UTM tracking for his press releases. Similarly, content writers were not sure how to measure the performance of the pieces they were writing. Why? Because the agency focused on completing the production task (write a press release, post a social comment) and not the outcome. Why? Because completing the production task meant they could invoice the client and move onto the next production task.
This is a dangerous operating model because quality clients (those with reasonably smart marketing staff) will see through this quickly. To keep the charade going, it forces the agency to work with clients with lower sophistication (thus, lower budgets and less appetite for modern marketing). In the latter case, agency staff never really learn anything new because the client typically won’t allow them to test best practices.
If full-service agencies want to empower their staff, encourage data analysis, and drive accountability across their organization I recommend they consider consider modifying or replacing their production silo structure.