2013
DIGITAL MARKETING
AGENCY LANDSCAPE
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Karen Burka
Digital Marketing Depot
@dmarketingdepot
#SMX #22B
October 2, 2013
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©2013 Third Door Media, Inc.
Choosing a Digital Marketing Agency
Overview of the digital advertising market
Trends Driving Growth
Impact on the Agency Landscape
What it all means for you
©2013 Third Door Media, Inc.
Internet Ad Spending Continues to Grow (15% in 2012)
46.3%
33.0%
7.0% 9.0%
5.0% 0.4%
$36.6B in 2012
46.5%
35.0%
8.0%
5.0%5.0%
1.0%
$31.7B in 2011
Search
Display-related
Classifieds
Mobile
Lead Generation
Source: Internet Advertising Bureau
©2013 Third Door Media, Inc.
Digital Share of Agency Revenue
25.8%28.0%
30.3%32.5%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
2009 2010 2011 2012
$11.6$10.1B
©2013 Third Door Media, Inc.
Trends Driving Digital Ad Growth
Audience Fragmentation
Increasing Complexity of the Digital Landscape
Convergence of Paid, Owned, and Earned Media
Demand for Cross-Channel Campaign and Data
©2013 Third Door Media, Inc.
Audience Fragmentation
©2013 Third Door Media, Inc.
More Complex Digital Marketing Landscape
Mobile
Search
Social
Display
PR
Website
©2013 Third Door Media, Inc.
Digital Media Channels
Search
SEO
Keyword research
Content creation & optimization
Link analysis
Local/geo-search
Mobile programs
International tracking
Campaign management
Paid Search
Bid management & optimization
Landing page optimization
Affiliate marketing
Search Retargeting
Campaign management
Social
Content management
Brand compliance
Influencer outreach
Community building
Global programs
Sentiment analysis
Video design/development
Display
Media planning & buying
Creative
Branding
Display/retargeting
Website
Design & development
Content creation
Ecommerce
CSEs
Microsites/landing pages
Mobile
Program design & execution
Bluetooth apps
Website audits
App & game development
Video/commercial design
PR
Blogging
Online publicity
Online brand monitoring
SEO/link building
Program design & execution
List/database development
Lead generation
©2013 Third Door Media, Inc.
Paid, Owned, and Earned Digital Media Then
Paid Media
Paid search
Display
Social (FB ads/sponsored
tweets)
Mobile (ads)
Owned Media
Mobile (apps/games)
Website content
Social (FB pages, blogs/Twitter accts)
Earned Media
SEO
Mobile (shares/reviews)
Social (retweets/likes/
pins/shares)
©2013 Third Door Media, Inc.
Paid, Owned, and Earned Digital Media Today
Paid Media
Paid search
Display
Social (FB ads/sponsored tweets)
Mobile (ads)
Owned Media
Mobile (apps/games)
Website content
Social (FB pages, blogs, Twitter accts.)
Earned Media
SEO
Social (retweets/likes/
pins/shares/
reputation management)
Mobile (shares/reviews)
Paid/Owned Media:
Mobile ads, apps,
games
Social media ads,
Twitter content,
blogs
Paid/Earned Media:
Social media ads,
shares, likes,
reputation
management
Mobile ads,
shares,reviews
Earned/Owned Media:
Social likes, shares,
retweets
Mobile ads, shares,
reviews
Earned/Owned/Paid
Media
Social (ads, blogs,
shares, sponsored
content)
Mobile (apps, shares,
ads)
©2013 Third Door Media, Inc.
Demand Grows for Integrated Campaigns
From IBM’s 2013 State of Marketing Survey…Leading marketers want greater levels of integration in their
digital marketing suites
74% say campaign integration is the most important capability
Yet…
Only 31% actually integrate social and mobile marketing with other campaigns or programs
©2013 Third Door Media, Inc.
How Are Agencies Responding?
Diversify through Consolidation
vs.
Specialization
©2013 Third Door Media, Inc.
The Consolidators
95% of agencies and brand marketers are planning to add additional services in the year ahead, with 64% planning to add social media, 61% anticipating the addition of content management, 61% adding mobile and 58% looking to add SEO.
Source: Digital Marketing Depot Survey,
May 2013
©2013 Third Door Media, Inc.
Selected Holding and Media Company Acquisitions of Digital Agencies
Acquirer Acquired/Merged Date Notes
Aegis Group plc Communicate 2
I Spy Marketing
Catch Stone
Roundarch
August 2012
August 2012
July 2012
February 2012
India-based search agency
U.K.-based digital agency
Chinese digital agency bought for £55.2MM
Purchased for $125MM
Dentsu Aegis
Steak Group
Firstborn
Innovation Interactive (360i)
July 2012
June 2011
February 2011
January 2010
$4.9 billion purchase price
U.K.-based digital media agency
NY-based digital agency with animation and web
development services
Included digital agency 360i and PPC platform
IgnitionOne
Epsilon Aspen Marketing Services April 2011 Purchased for $345MM
Hearst Corp. iCrossing June 2010 Acquired for estimated $325MM
Interpublic Group FUSE
CUBOCC
Reprise Media
February 2012
March 2010
April 2007
U.K.-based digital agency
Brazilian digital marketing agency
Bolstered search marketing capabilities
Merkle IMPAQT March 2011 Added search to existing CRM capabilities
Publicis Groupe Big Fuel
Rosetta
July 2011
May 2011
Bought 51% of the social media agency
$575MM acquisition to complement U.S. search &
digital marketing brands
WPP Hungama Digital Services
Fortune Cookie
AKQA
DTDigital
June 2012
August 2012
June 2012
January 2012
India-based digital agency purchased by JWT
Acquired by WPP agency Possible Worldwide
$550MM purchase price
WPP subsidiary Ogilvy bought 33.3% stake in
Australian digital agency
Source: Third Door Media / Digital Advertising Agencies 2013 Buyers Guide
©2013 Third Door Media, Inc.
July 28, 2013: $35 Billion Merger of Publicis Groupe and Omnicom Group
Omnicom Group
BBDO
Organic
Juniper Park
Clemenger Group
Proximity Worldwide
TBWA
Being
Designatory
Fame
Integer Group
Zimmerman Advertising
DDB
Alma
Interbrand
Tribal Worldwide
Uproar
Rapp
Rodgers Townsend
Kern Organization
Omnicom Media
Novus Media
Icon Int’l
Resolution Media
Team Ignition Pancultural
PHD
Fleishman Hilliard
GMMB
Ketchum
©2013 Third Door Media, Inc.
Publicis Groupe
PublicisWorldwide
PublicisModem
Leo Burnett Worldwide
LBW Arc
Lapiz USA
Amazon Advertising
DigitasLBi
MRY
Phonevalley
Saatchi & Saatchi
TeamOne
S&S X
Conill
StarcomMediaVest
Big Fuel
Spark SMG
Tapestry
MV42
SMG Performance
Marketing
ZenithOptimedia
Moxie
Ninah
Performics
Opimedia Int’l
Zenith Media USA
Razorfish
©2013 Third Door Media, Inc.
The Specialists
Boutiques or specialty agencies that provide channel-specific digital marketing services such as mobile messaging programs, social media marketing, or SEO link-building campaigns.
©2013 Third Door Media, Inc.
Growth In the Long Tail Agency Market
*Optify data
Established
Business
Identifiable
Agencies
North
America
121,000* long tail agencies
54,000
25
900
Largest
U.S.
agencies
Consolidated
Agencies
©2013 Third Door Media, Inc.
So What Does This Mean For You?
©2013 Third Door Media, Inc.
Specialist vs. One-Stop Shop
More granular channel strategy
More access to agency decision makers
Lower spending minimums
Diverse capabilities
Built in referrals
Network efficiencies
©2013 Third Door Media, Inc.
What or How Should You
Expect to Pay? Time Based Percentage of Spend Fixed Fees Retainers
©2013 Third Door Media, Inc.
How Do You Get Started?
RFIs/RFPs Referrals
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