Next Generation “Advertising Agency” Model
Historically, advertising agencies have been compensated by traditional, all encompassing retainer and project fees to cover all of their efforts in creating and delivering campaigns. With little proven alternatives, agencies monetize their work through staffing plans driven by bodies, hourly rates and billable hours. In essence, agencies have basically been rewarded for “effort” and how how many hours they spent “working on” the business. This is a tough model for a massively creative pursuit…how hard you work doesn’t necessarily correlate with how big the idea is but how else can agencies make money?
Goes without saying, but the environment agencies are operating in has changed dramatically but the agency business model…not so much.
Whether it’s Anomaly or BBH Zag, new models are developing where “agencies” seek to monetize their Intellectual Property in a different, more innovative way. These models include blends of capabilities from agency, VC, management consultant and start-up worlds and are being looked at by some as the future of the “agency” business model…
Add the legendary Mr. Jon Bond into the mix of sorting out what’s next…
http://adage.com/agencynews/article?article_id=144355
NEW YORK (AdAge.com) — Four months after departing Kirshenbaum Bond Senecal & Partners, the New York agency he co-founded in 1987, Jon Bond — backed with some $100 million in financing — is setting out to build a new marketing services entity to rival Kirshenbaum’s owner, MDC Partners, and other holding companies, according to several industry executives.
Jon Bond
The entity is being dubbed a “cooperative” to prospective partners and touted as an alternative structure to the current advertising and marketing holding-company model. Mr. Bond is said to have met with some 80 to 100 marketing services firms and tech outfits , in the U.S. and in Europe with a range of specialties. People familiar with the situation said Mr. Bond has raised $100 million from multiple resources and has invested his own money into the venture, too.
Thanks to Brian Racis of McCann Worldgroup for picking off this intriguing article.
