Simply put, they’re getting a whole hell of a lot more bang for their buck.
We’re excited to announce the first episode of our new vlog, #TalkShop. Bringing you all of the freshest news in experiential marketing, industry trends worth talking (or just laughing) about, and some of our thoughts on the world of marketing agency work from client relations to internal operation woes.
Here are a few segments from Luke Miller and Noah Osborne in our first episode of #TalkShop.
To watch the full video click here.
Coming to you from the Moon! This segment is called Talk Shop, why? Because we are Shop Marketing and Creative Group, we are an experiential marketing agency based in Denver, sunny beautiful Colorado and we wanted to start a segment called Talk Shop to not only introduce ourselves to the world but also to talk about some industry trends and hopefully shed a little bit of light, maybe a different light, on some things happening in the world of marketing and advertising.
I think the big thing that we want to accomplish with these discussions is to keep our viewers privy to what we’re working on from a week-to-week month-to-month basis. Maybe share about new clients we’re chasing, share about a few of the the most innovative or unique activations that we’ve done as of late and also talk about industry trends– what’s hot, what’s changing– I think one of the biggest things about Shop Marketing and Creative Group is the fact that we like to do things a little bit differently. We like to look at the status quo and see how we can turn that upside down, turn it on its head and do things a little bit differently and ultimately create the most value possible for all of our clients. We’re constantly running into unique challenges and problems that we’d love to share and we’ll also often run into things happening in the industry that seem a little stagnant so we’d love to review those types of topics here as well.
Without further adieu, I’m Luke Miller and I’m Noah Osborne, we are the Co-Founders of Shop Marketing and Creative Group and we hope to shed some cool insights on the world of Marketing and Advertising. We may even bring a few rap songs, Frank Sinatra Style, and you won’t want to miss that. Think Gucci Gang by Franky Sin.
So the topic today for our first episode of Talk Shop is the AOR or retainer model. For those of you who don’t know, AOR stands for Agency of Record. It’s an age-old practice of basically handcuffing an agency to a company and forcing them to do work together.
The AOR model is something that some of our bigger clients who are more experienced in the experiential marketing arena are beginning to shed this somewhat old antiquated idea that is the AOR model. It made a lot of sense in the beginning when, as a brand, you were working traditional or digital marketing agencies it made more sense, there was more of a need for such a model. We believe that that’s no longer the case. But why? Well, I think that one of the big reasons that I’ve seen is that it ultimately stifles creativity. When you’re tied to a single agency, or, better yet, from the agency perspective when an agency signs a big deal with a brand like a 1 to 3 year contract ultimately they get comfortable. Yes they’ll still get the work done, they may even do a good job, but there’s a paradigm shift internally when everyone realizes hey we have client “X” for the next 12 to 36 months. Yes, we need to do a good job but ultimately we’ve got 10 to 15 other clients so the mentality begins to shift toward doing the bare minimum not to lose them rather than go above and beyond to win more business from them. Instead of thinking about the top of the threshold of creativity really doing something unique and remarkable you start looking at the bottom of that threshold which implements only enough creativity and effort to be sure you aren’t going to lose that client.
Another great example of the inefficiencies seen in the AOR model can be found in the number of hours spent on a project. Giving them the hundred hours they’ve signed up for despite the fact that they may have come up with the best idea in 30 seconds they’ll still have 10 hours this month that need to build for they’ll let’s throw out a bunch of other crappy ideas on top of it just to use up the hours that they need to use. For us, the AOR model is difficult because we’re a smaller agency, but we’re a smaller agency because we want to be. What happens is these bigger agencies have the the the muscle, the firepower to say hey sign on with us we’ve got all these awards and this client list that’s 30 miles long, come to us you can’t beat it. When that happens some of the medium and small agencies are left in the dust despite maybe having better creative or the ability to produce higher-quality things because they’re doing more with less. Ultimately it hurts the industry and we don’t just say this from our perspective we say it from an industry perspective because there are lots of other small agencies just like us who deserve the opportunity to succeed. When the largest agencies hold onto their brands with an AOR for 3 plus years it prevents another agency from coming in to pitch even a smaller sized idea that might really bring added value to that brand. There’s no ability to say hey we want to spend $50,000 – $100,000 on something really unique, I know you have an AOR agreement with big agency X for $3,000,000 for this year but we can’t work with you because of that contract even though we could probably offer some higher level of creative. At the end of the day, those brands are missing out on the opportunity for project-based work that wins your heart, wins awards, just like a company that you may have a retainer with.
The guys who’ve been doing this for a while, the biggest brands out there the household names they’re beginning to move things this way if they haven’t already gone there. They’re Getting rid of the “AOR/we’re in bed with you for the next three years” creativity stifling mindset, and what they’re now doing is creating a pool of agencies who are fully vetted and ready to work with. This competition amongst a group of potential agencies is ultimately yielding substantially more creative projects on top of more affordable activations because of the need to compete amongst other firms vying for the business. Simply put, they’re getting a whole hell of a lot more bang for their buck.
To watch the whole video check it out on our YouTube channel, please give it a like, shoot us a question in the comments section and subscribe. We’ll be continuing to post every week or so as we have LOTS we’d love to talk about.
If you’re reading this and you have any questions we’d love to hear from you so drop us a line, we’re always happy to chat!