A short list of what “marketing” encompasses today can include the design and execution of primary and secondary research, data gathering and analysis, target segmentation, brand architecture and the development of brand strategy, product and service line development or extension, naming, design and legal protection of identity, packaging and collateral assets, development of communications and campaign strategies…You get the idea. The list of marketing functions is anything but short. And it grows daily as marketing and delivery environments rapidly change. Very few companies can handle every single discipline, so most companies outsource quite a bit of it to other marketing companies or marketing consulting agencies.
These consulting agencies are good partners with their clients. They have teams of people that know just as much about the client’s company and brands as the client’s internal staff. They understand their client’s industry, consumers and workforce. They monitor trends, news and online opinions about the client and its competitors, then charge professional fees relative to the value they deliver to the client. But most importantly, they care deeply about the success of the client.
Clients and agencies can take a partnership a step further by sharing in costs and risks beyond an hourly or commission-based billing model. Since the beginnings of the modern marketing agency, many firms have invested their own capital in medium to long-term projects. Examples are start-up businesses, product or service launches or the development of movies and entertainment acts. Usually these investments are made in return for equity in the deal, licensing rights to intellectual property or a percentage of future revenues and profits.
Bozell has been approached in the past year by a number of companies searching for this kind of shared arrangement. We handled the request like we were a potential business investor. We evaluated the market feasibility of the project, the potential for success and the timing of returns.
In one case, the owner of a retail product line approached us for ideas to increase his e-commerce sales. Ultimately, these discussions led to Bozell becoming the brand manager of his online sales channel – completely responsible for developing the online marketing strategy as well as creating all of the Web-based tools. Bozell even fronted all of the costs for this endeavor. In return, Bozell receives a percentage of the online sales.
Like any business or organization, marketing agencies all have their own personalities. But one thing always holds true – they all love to sell. Whether it is a product, service, idea or social or political cause, they want to see their knowledge, creativity and experience yield success. Cost/risk sharing doesn’t work in every scenario, and obviously as a client you can lose some control and future return, but in many cases when either early-stage funding is tight or you want a partner to truly have some skin in the game, it can be very successful for both parties.