×

We've got news for you.

Register on BusinessLIVE at no cost to receive newsletters, read exclusive articles & more.
Register now
Picture: 123RF/videoflow
Picture: 123RF/videoflow

Many media agencies in SA are missing a trick as more creative agencies move into their space, offering similar services and in some cases eating their lunch. This is just one finding from the newly released "Agency Scope 2021/2022" report, compiled by research company Scopen in conjunction with the Independent Agency Search & Selection Co (IAS).

The report also shows that digital marketing spend in SA is set to grow briskly this year, surpassing the current 37%. Since 2020 the sector has posted growth of close to 20% year on year.

The fourth edition of the report polled close to 500 senior industry professionals from more than 150 companies. The data forms part of a body of research conducted in 10 other markets across five continents.

César Vacchiano, president and CEO of Scopen International, says global digital investment has grown by just under 6% in the past three years, with the highest digital budgets in China and Brazil (50.1% and 45.1% respectively). He says more partners are working with marketers "in a far more complex ecosystem", helping clients with their communication mix.

On average, each advertiser interviewed in the survey works across its communications, marketing, advertising and media projects with 13 different partners. When referring to digital engagement and expenditure, the data includes social, influencers, content, search, programmatic, customer relationship management and e-commerce.

IAS founder and CEO Johanna McDowell says: "The complexity of this number of partners requires robust leadership to establish which companies are responsible for which space, and how to keep them in their own lanes. The companies themselves must be acutely focused and leaders must manage collaboration. The two primary ways of doing this would be for the CMO [chief marketing officer] to run it, or to appoint a lead agency that the CMO can trust to assist with this hugely important aspect."

Vacchiano says a standout in the research is client satisfaction and appreciation of what agencies are doing to deepen working relationships through the pandemic.

McDowell says travel restrictions increased the availability of senior executives on the client side and has given agencies more access to the C-suite. "This has been a boon to agencies that took the opportunity to demonstrate their capabilities and successes at the highest level."

The analysis has also brought to light how marketers have invested their spend. Globally, investment is about 50% on brand building, long-term brand development and big campaigns, and about 50% on shorter-term performance and sales-driven lead generation initiatives.

"What this says to us is that reinforcing brands in the mind of the consumer is of equal importance to marketers as the short-term wins from leads and sales. The opportunity for big branding campaigns should not be ignored," says Vacchiano.

Of concern to local media agencies will be a finding that some are continuing with their core business of planning and buying, but are not engaging in the digital sphere. However, McDowell notes they are not as involved in digital media, branded content, social media and influencer marketing as their counterparts in the rest of the world.

But more creative agencies in SA are now moving into the media space and offering more media services — the study cites Joe Public, Clockwork Media, King James and M&C Saatchi Connect. Marketers say their preferred collaboration model (51.5%) is working with an integrated agency.

McDowell says: "This is a huge opportunity to respond to client demands. Globally, media agencies are seizing these golden chances, rather than creative agencies — but in SA we find the complete opposite."

The research shows media agencies around the world have gained a foothold in the digital sector and are already working on strategies and production, as well as aspects related to display, social, influencers, content, and e-commerce.

"All these areas have been adopted as opportunities for growth internationally, but we don’t see that happening in SA," McDowell says, noting that creative agencies are moving into the media space and starting to offer integrated services that include media solutions such as strategy and buying.

Vacchiano says an issue that needs attention is that media and creative departments in some companies operate in silos, each with its own leader. Clients view this as a challenge as they believe integrated data is what business decisions ultimately rely on.

subscribe

Would you like to comment on this article or view other readers' comments?
Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.