There has been a significant shift in the seven years since Victoria Fox – expert in marketing operating models, agency ecosystem design and marketing transformation – joined AAR as CEO.
Even five years ago, marketing operating models were considered a specialist concern, if they were discussed at all. Now, they are at the forefront of the conversation. Every marketer understands that delivering marketing strategy in the late 2020s, especially when built around data and technology, requires both holistic thinking and a willingness to engage with marketing as an interconnected system.
For a long time, people, process, platforms and partners were treated as separate concerns, each with their own project and their own set of solutions. But as marketing moves away from campaigns to an always-on function that analyses data, responds in real time and personalises at scale, silos and bolt-ons are no longer enough. And it’s within this context that agencies have to evolve.
We spoke with Victoria about how marketing has changed, why operating models have become such an important part of the conversation, and what agencies need to do to keep up.
How has the agency’s role changed?
Clients, traditionally, have looked to agencies to act as the connective tissue that papers over internal fragmentation. Structures were siloed and disconnected, and time-pressed marketers leaned on agencies to parachute in and try to stitch things together from the outside. In many ways, this put unfair pressure on agency teams, who might be perceived as not delivering when the real issues lay within the client’s own operating model.
As the industry has matured, however, it has become clear that making model design the agency’s problem is simply unsustainable, and brands are now doing much of the structural work themselves. The impact for agencies is that, rather than stepping in as a supplier, they must become fully enmeshed into an existing – and often flexing – system.
The distinction may seem nuanced, but it requires a completely different way of working. As Victoria explains, agencies now need to encompass a holy trinity – becoming system thinkers, subject matter experts and relationship builders all at once. This is, to say the least, challenging. But get it right, and your agency becomes part of a wider jigsaw puzzle that achieves truly transformative things.
What do good client/agency partnerships actually need?
The best agency partners understand the client’s system before they try to advise within it. Rather than sitting outside the organisation, delivering discrete pieces of work, they act as a genuine extension of the client’s own team.
Victoria is careful to note, however, that this is not entirely the agency’s responsibility. Instead, it is a joint effort. Agencies need to be curious and generous. Clients need to be willing to let their agencies in, giving their time to help them understand their wider goals and challenges. This might be more difficult for organisations that are still mid-transition as they rewire their operating models, keeping some agencies at arm’s length simply because the conditions for closeness haven’t yet been built.
There is also a financial reality to contend with – that is the tension between what is needed and what there is investment for. When agency fees are leanly cut, generosity becomes much harder to sustain – as Victoria puts it, there is “no margin”. The fact remains that short-term financial pressure is often at odds with building the connected operating model we all, as an industry, agree we need.
What enables collaboration between marketing teams and agencies?
For Victoria, the onus is on the client to set the agenda when it comes to collaboration and to build the systems to make it happen – pointing to the naivety of simply asking agencies to do so. Without incentive, there is no reason why, for example, a PR agency would hand over an idea that’s best leveraged by a social agency, because there is no financial driver to do so. Clients have to engineer the right conditions in their agency model for multiple agencies and departments to respond collectively against a joint set of KPI’s.
Do agencies need to reorganise, or just change behaviours?
Victoria is clear in her answer to this question – agencies definitely need to reorganise in response to how brands are rewiring the operating model, in mirror image. It’s not easy, especially as agencies need to do so while serving the old model and against tight budgets.
There is also a tricky “people” element involved. We’re moving to a space where more and more of the “doing” is going to be automated, so the value exchange between agencies and brands will be increasingly about the thinking, not the execution. Previously, however, junior talent has learnt by doing, rising as they gained skills and expertise.
Clearly, we can’t stop bringing in junior talent, or the industry will meet a skills cliff before long – but we do need to train them differently, drawing them into strategic conversations far earlier than we may have become accustomed to.
What does the agency of the future look like?
Asked how she’d design an agency from scratch today, Victoria points to the argument from her speech at the IPA Business Growth Conference.
Our whole industry understands that by 2030, the technology and data explosion that’s been reshaping marketing will have been absorbed into how businesses run, so having a good system will stop being what sets an agency apart. Clients increasingly have that infrastructure themselves.
What they can’t generate from inside their own system is the leap: the decision that isn’t fully backed by the data yet, but changes what the business becomes. So the agency of 2030 will win by being senior, lean and close to the boardroom, understanding the client’s system well enough to work inside it, but independent enough to challenge it and supply the conviction the system alone can’t produce.
Victoria does have a warning for both brand and agency marketers, however. We have to be careful that we’re not building machines towards digital sameness. You may need a really smooth system that takes advantage of all the data and the technology, but you also need a really powerful brand and conviction that separates you from your competitors. We are in danger of doing the first and losing the second.
In the face of such rapid change, agency leaders are tasked with gaining the operational fluency they need not only to reorganise their own structures but to integrate seamlessly within their clients’ systems. It’s this – alongside adapting into senior, lean, systems-thinking teams – that will allow agencies to deliver the high-conviction creative leaps that actually move the dial, and prove their unique value long into the future.
