Though the ubiquitous reach and seemingly boundless resources of a large multinational agency may be alluring, Barbara Bates warns that brands should look for something a little more fitting.

Similar to the conundrum that faced Goldilocks when choosing her bed, one size rarely fits all – and this fable rings particularly true when it comes to communications agencies.

As a marketer’s remit continues to grow, ambitious brands are increasingly looking for the global reach of a large multinational agency, with the fit and feel of an agency half the size. Somewhere not too big and not too small – arguably, just right.

As evidence of this shift, The Holmes Report found mid-sized communications agencies today have a higher growth potential. Mid-sized agencies are experiencing an average fee income growth rate of 6.1% globally – for comparison, the top 10 PR firms are achieving a mere 0.9%. The mid-size band currently enjoys a growth rate more than six and a half times greater than that of the global top 10.

Clearly, there is something to be said about the mid-size agency model.

The decline of AOR and the rise of ‘projectisation’

Not that long ago, an agency of record (AOR) was the norm, and allowed the larger full-scale firms to dominate the industry. But as the digital marketing landscape continues to splinter, the need for specialised expertise has grown, leading brands to a variety of ‘best-of-breed’ agencies. Some refer to this as ‘projectisation’, to which agencies have adapted quickly, and is certainly not exclusive to clients within the technology space – from B2B to B2C, brands are no longer putting all their eggs in one basket.

Naturally, the decline of AOR has opened up opportunities for mid-sized agencies to work with much larger brands; opportunities that were previously out of reach to ‘smaller’ agencies who lacked the resources to cater to the full-suite of enterprise marketing needs. But winning sizeable chunks of business from large clients has encouraged midsize agencies to step outside of their comfort zones and offer a greater breadth of services than ever before.

In the face of a ‘disrupt or be disrupted’ approach to global communications, mid-sized agencies are challenging the status quo and becoming more rounded in the process. Mid-sized agencies should be using size as a weapon. Rather than aspiring to be like the big guys…be better.

Related: Model mania – Ogilvy director on reconsidering your agency relationships »

Challenging the top 10

The key to staying relevant in today’s fragmented media landscape is to be nimble. Agencies willing to think differently and do away with tired, ingrained practices (like time sheets and hourly rates) will attract clients who are equal challengers in their own field.

I believe there are three things that will cement the mid-sized agency as the right size agency, and challenge the dominance of the top 10. Firstly, always remember the enemy of great is ‘good enough’ – mid-sized agencies must up the game and consistently strive for greatness through being in a constant state of beta, attracting the best possible talent and delivering ambitious, adventurous work of high value to our clients.

Secondly, a practical scaling strategy is also required. The great selling point of multinational agencies is often their promise of global collaboration and work that transcends borders. The reality however, is often very different, with a lack of internal communication and clearly defined financial models getting in the way of great work. For example, focus on a single profit and loss statement supported by a model that prioritises the best interests of both clients and people – a single, unified goal.

Lastly, in an era of disruptive technologies, it is not only consumers who are favouring innovation. Businesses, regardless of size or industry, are seeking out agencies with a proven track record of working with disruptors and leaders. Globally there is growing demand for communications that transcends the status quo and goes beyond the ordinary. Brands, particularly in tech, are pushing the boundary of what is possible and are looking for creative agencies that can meet them on their search for something different, something just right for them.

Welcome to the era of mid-size.

Barbara Bates is CEO Hotwire Global

Further Reading:

• Your agency could be breaking privacy laws – spotting the signs and how to respond »
• The usual suspects – simplifying your agency roster and the specialist myth »

Willian Justen de Vasconcellos