Scoping your agencies to win in the digital economy

Different companies have different processes, templates and ways of working, but most still look to have an annual strategy document that summarises what the brand goals are for the coming year and the key strategies to achieve them.

However, what I continue to see more often than not is marketers looking to the past to guide the future. Tell-tale signs include:

• Following a historical marketing mix model analysis that informs on ROI of channels from as far back as three years ago, by which the landscape has since significantly changed.
• Product concept testing questionnaires to validate new launches that typically feature loaded questions to force-fit acceptability of a global concept in a local market.
• Case studies that whilst they may have had a great idea at the core, would look very different from an activation perspective in 2017.

FMCG in particular is facing real challenges. Ninety percent of the top 100 FMCG brands didn’t grow last year. For the majority, doing things the same way as before clearly isn’t the path to growth in the digital economy.

Agency scope-of-work agreements, essentially a contract of deliverables that retained agencies are paid to deliver, are also usually discussed in annual terms too. Despite often talking about how categories are being re-contextualised in their five-year strategy documents, agencies are inevitably still briefed pretty much the same way as the previous year—which ironically, would have been the same as the year before.  

Below are five suggestions that I encourage clients to consider when planning the agencies’ scope of work:

1. Re-define your marketplace

Some brands are sometimes guided by their defined ‘category’, which is often dictated by retailers. This dependency on existing customers and networks is a root cause of the innovator's dilemma and one of the core reasons why the 90 percent of the top 100 FMCG brands are in decline.

The first priority should be ensuring that your brand plan reflects consumer behaviour and creates value. This value can be time, money, entertainment, social worth and so on. Redefine what your brand stands for and unlock tremendous growth opportunities by looking beyond its traditional category and understanding the broader consumer activity cycle. Rooted in consumer behaviour and typically addressed via a tech solution, it also helps accelerate digital competency. This may sound like (and is indeed) a massive step, but just scoping in a project to work out activity cycles around key brands will be a massively insightful project that could help define your future strategy.

2. Re-think commerce

According to eMarketer, Asia Pacific became the largest ecommerce region in the world last year. The last few years have seen the setup of vibrant startup communities across many markets, providing tech solutions to issues such as payment, logistics and product sourcing that, coupled with the smartphone boom, are transforming the way brands are bought. Agencies should be scoped to provide solutions on how to facilitate this transition especially for established brands that are dependant on established retailers who are falling behind in the digital economy. It would also be advisable to perform some test-and-learn projects to validate hypotheses around alternative commerce channels.

3. Data prioritisation

A meeting rarely goes by nowadays without data being mentioned. It seems like everyone appreciates its importance, but for brands that do not have a legacy of leveraging data for digital media personalisation and performance, there is rarely a proper data strategy in place. Third-party data is everywhere and easy to acquire, but to really enable personalisation and differentiation, clients need their own first-party, people-based data. Ensure that the scope of work challenges your agencies to help your brands build a first-party data set and more importantly, put it to useful effect.

4. Reflect consumption behaviour in the brief

Whilst the above three recommendations may sound difficult to implement, this one really isn’t. Whether it’s salary men in Tokyo or Gen Z in Jakarta, the majority of people are watching a lot less linear TV and spending a lot more time on their phones. However, media agencies are repeatedly briefed to distribute TVCs on digital platforms. The majority are simply not fit for purpose. Consumption behaviour in digital, particularly on newsfeeds, is totally different. Communication strategies cannot start with a TV ad or a TV script. Instead, they should begin with a creative idea that works across multiple touchpoints with customised content at its heart while reflecting consumption habits. If your creative agency’s scope of work revolves around edits of a TVC, change it.

5. Make the most out of targeting and distribution

By having made-for-platform content at the heart of your comms plan, you will see higher engagement and better business results. This can often mean lower costs, particularly when looking at cost per views (CPVs) for video content. Take this a step further by having content that targets different interests, behaviours and actions. I don’t mean the unnerving ‘follow you around’ type of content, but contextual or interest-based targeting. If someone can relate to your content, it’s more likely to be distinctive and therefore memorable.

So often, comms plans are held back because clients allow unaccountability on the part of creative agencies in relation to point four above. As a result, point five doesn’t happen. These are issues that are immediately addressable, but do require a rethink on how scope of works are briefed. Points one to three may not be aspects on which you’d necessarily brief your creative or media agency. However, many agencies are developing commerce and data capabilities, which can help brands to identify alternative strategies to win in the digital economy.

Surely, that is worth scoping for.

Jonathan Rudd is regional head of digital strategy at Carat. Follow him on Twitter @jrudd_digital.