The New Breed of Agencies:One of the Leadersof the Pack

PresidentIgnited Minds

RESHUFFLING THE DECK

DIGITAL MARKETING CONFERENCE

AAAA

JUNE 14, 2007

INTERESTING TIMES

OVERVIEW

• IM Story

• Opportunity in Marketplace

• Challenges

• Solutions

• Case Study

IGNITED MINDS’ STORY: CLIENT TO AGENCY

IGNITED MINDS’ STORY: CLIENT TO AGENCY

MechWarrior 2: First game mini-site 1994

Built an agency around 4 things we couldn’t find:

1. Digital core passion

2. Silo free

3. Expertise with digitally savvy/jaded consumer

4. Strategic Thinkers

FILLING A MARKET NEED

Outdoor

TV

Direct Experiential

Radio

Print

Online Ads

DIGITAL

VITAL STATISTICS

• Founded in 1999

• 140 full-time employees

• 30 clients

• 40% AOR, 60% project

• Los Angeles based

– Moving from 21K sf to 55K sf

• Unusual talent base

• Initial focus:

– Heavily project based

– Aggressive business development platform

CLIENTS

DECK WILL BE RESHUFFLED

Massive Shift in Media Consumption Habits

ONCE IN A LIFETIME OPPORTUNITY

• There’s never been a better time to be in the marketing business

REDEFINING OR RENAMING THE ADVERTISING AGENCY

?

• Advertising agency

• Digital agency

• Marketing agency

• Communications agency

• Web shop

• Marketing consultancy

• Design firm

• Media agency

• Brand consultancy

• Direct Marketing agency

• PR agency

• Search agency

DECK GETS RESHUFFLED: TOP 20 INTERACTIVE AGENCIES

2000

1 Sapient

2 TMP Worldwide Interactive

3 IXL

4 Razorfish

5 marchFirst

6 Grey New Technologies

7 UX Design

8 Agency.com

9 Digitas

10 Proxicom

11 Answerthink

12 Xpedior

13 Euro RSCG Worldwide Interaction

14 Luminant Worldwide

15 Modem Media

16 Ogilvy Interactive

17 Organic

18 Rare Medium

19 US Interactive

20 Zentropy

2006

1 Avenue A/Razorfish

2 Sapient

3 Digitas

4 Wunderman

5 Rapp Collins Worldwide

6 Ogilvy Interactive

7 Organic

8 AKQA

9 DraftFCB

10 IMC2

11 Leapfrog Online

12 Modem Media

13 G2

14 R/GA

15 Performics

16 Tribal DDB

17 Proxicom

18 Agency.com

19 VML

20 iCrossing

DECK GETS RESHUFFLED: TOP 20 ADVERTISING AGENCIES

20122006

1 JWT

2 BBDO Worldwide

3 McCann Erickson Worldwide

4 Leo Burnett Worldwide

5 Ogilvy & Mather Worldwide

6 DDB Worldwide Communications Group

7 Y&R

8 Grey Worldwide

9 Saatchi & Saatchi

10 DraftFCB

11 Publicis

12 TBWA Worldwide

13 Euro RSCG Worldwide

14 Doner

15 Richards Group

16 Deutsch

17 Campbell-Ewald

18 Bernard Hodes Group

19 GSD&M

20 Hill Holliday

?

BUSINESS DEVELOPMENT APPROACH:

DIFFERENT TYPES OF CLIENTS

Happy with Agency

Seeking fresh thinking for a

brand or capability

- Digital Media Buying

- Events

- Strategic Planning

- Pop-up store

Unhappy with Agency

Risk Averse Change Agent

Willing to Consider

NextGen Agencies

CHALLENGES FOR SMALLER INTERACTIVE AGENCIES

Sale once every 4 years Regular maintenance

Single big sale Annuity revenue stream

Transition to microsites & continuous enhancements

CHALLENGES OF SMALLER INTERACTIVE AGENCIES

vs.

Limited range of offerings/strategic expertise

Lack capital to employ ―thinkers‖

Limit where you enter/manage relationship

Websites Advertising Media Events

IM LEARNING STRATEGIES: MULTI-DOOR STRATEGY

Primary Offerings:

Secondary Services:

Branding/

Design

Motion

& Sound

Public

Relations

Research &

Bus. Analytics

LISTEN & LEARN FROM THOUGHT LEADERS

• Richards Group: Virtually no offices — one location

• Fallon: DreamCatcher

• Crispin: Guide to Self-Actualization

INTERACTIVE PERSONNEL: WANT TO SIT AT THE ADULTS’ TABLE

SINGLE P & L

UNIFIED CREATIVE

MANAGE HUMAN RESOURCE CHALLENGES

• Hiring too quickly

• Slow to react to competitive hiring environment

AGENCY BILL OF RIGHTS

• State what we expect out of clients at first meeting

Our Ideal Client

• wants us as a partner, not a vendor

• wants us to do the best work in their industry

• encourages us to be profitable

• is willing to take calculated risks

• has a streamlined, simple decision-making process

GETTING PAID WHAT YOU’RE WORTH

• Pricing: need firm strategy

– Separate pricing from Business Development & Account personnel

– Near term — more aggressive pricing for Interactive

Absolutely! Just

let me get an

„OK‟ on that from

my manager.

LESSONS FROM OUTSOURCING

• TV Production resourcing vs. Digital design/production resourcing

• Choose not to outsource creative & critical execution

Internal Agency TeamOutsource Digital

Creative to Partner

Respect Crispin & Goodby model

Different approach

FOCUSED ONLINE OFFERING

• Narrowly focused set of services

• Marketing focused

• Recurring revenue streams

COMPETE AND COOPERATE

• Smaller agencies must cooperate/collaborate

QUALIFY & BE SELECTIVE

• Don’t chase every opportunity

CASE STUDY: U.S. ARMY First door: Events

• Need 80,000 people each year

– Army is perceived as low-tech

– Job market good

• Cluttered media landscape

– Discerning consumers of media

CHALLENGE

• Educate while entertaining

- Communicate core Army values

- Show the wide range of jobs

• Icebreaker: initiate a relationship

- Track & measure

- Experiment and learn

U.S. ARMY RECOGNIZED THE POWER OF DIGITAL MARKETING

Marketingof Games

Marketing of Products

BK Jeep Army

• Over 8 million registered players

• 4.5 million players completed Basic

Training

• Consistent top 10 game on Internet

• Soft-sell marketing tool:

– Educate while entertaining

BUILDING ON THE SUCCESS OF AMERICA’S ARMY PROGRAM

MARKETING ECOSYSTEM

Console &

Mobile

Games w/

Ubisoft

AA-Based

Simulation

Systems

Massive PR

Coverage

Enthused

Recruiters

GoArmy.com

Fansites

Americas

Army.com

Sites

Fansites

PR

Console

Training systems

Experiential Mktg.

Real

Heroes

Goarmy.com

Game

Online ads

Hit GameImmersive Event

Experience

FROM ICE BREAKER TO MEANINGFUL DIGITAL RELATIONSHIP

Digital

Relationship

Anonymous Offer information/

Interest

Engage/

Escalate

Relationship

Measure/

Refine

=

State-of-the-art theme

park–like

experience

Buzz Lightyear

Pirates of the Caribbean

Men in Black

The world’s fastest-

growing entertainment

medium: video games

Authentic U.S. Army

materiel & combat

experience

+ +

MISSION: CREATE AN EXPERIENCE

VIRTUAL ARMY EXPERIENCE (VAE)

SOPHISTICATED VOLUNTARY DATA COLLECTION:

OFFER VALUE EXCHANGE

SCAN D.L.: VALUE-ARMY ISSUED ID

RFID SENSORS, BLUE FORCE TRACKER

CONTINUE RELATIONSHIP ONLINE:

AMERICASARMY.COM, ESS, FANSITES

CONTINUE RELATIONSHIP:

AUTO SEND EMAIL PHOTOS

ROBUST DATA COLLECTION AND REPORTING:

LEARN, REALLOCATE, RESOURCE & IMPROVE

RESULTS:

• Army has exceeded it’s recruiting mission of over

80,000 Recruits

“Why a Killer Video Game is the

U.S. Army‟s Best Recruitment

Tool”

CONCLUSIONS

Fundamental Change in Media Consumption Habits

Deck will be reshuffled

Opportunity for NextGen Agencies

-move to the top of the deck