Don’t mind that “black box” called your agency… Or should you?

Without a doubt advertisers have benefited from the agency of record relationship as it has it has evolved over the past 50-60 years of its existence. As with any type of symbiotic relationship it is about perceived and actual benefits to the entities involved in the relationship.

Just as in nature with the shark and pilot fish: The fish eat the shark’s parasites, along with other debris, maintaining the shark’s health and the fish in return receives a meal and protection due to their association with a top ocean predator but are not directly dependent on each other for survival.

Similarly the Agency, at least at the initial genesis of this relationship, provided for the health of the Advertiser/Brand allowing for access to specialized knowledge, services and creative resources that the would otherwise need to be employed by the Advertiser/Brand.

With the rise of the agency conglomerates where the agencies alone are bigger than most Advertiser/Brands they service this is where we depart from the neat Darwinian mutually beneficial relationship. Based on size, complexity and scale the relationship has become in many cases more predatory on the part of the Agency.

The large agency of course that needs to maintain its costs as flat as possible while growing revenue. Even though technology in many cases has made the supply chain much simpler and automated even though the costs have not fallen, become more opaque as to what is really being done and in most cases have increased.

AKA the “Black Box”.

Agencies no longer need to keep an immense production staff available to create print or broadcast pieces most can be produced by very few people using computers and Final Cut Pro, Adobe Premiere or Avid. Often farmed out to freelancers or sub-suppliers…

Not to say that all agencies are out to fleece their clients but it’s an evolution to maintain scale while providing the services and maintaining responsible overhead and revenue. But if this weren’t a common case of services/billing gone wrong we would not be seeing DOJ investigations in regards to bid rigging on RFP’s, serious questions in regards to fraud in programmatic digital services, and even the dropping of advertising on YouTube by advertisers.

Services currently in the news, such as digital programmatic, that are not secret sauce and can be managed easily with platforms such as <a href=”http://www.progmechs.com/what-we-do/” target=”_blank”>Programmatic Mechanics</a> with out the agency desks that have been created to co-opt/control the technology while adding a billable service. But digital is the most recent frontier in secondary post most relationships are vendors serving suppliers or agencies that then in turn often mark these costs up and pass it on to the client.

Don’t pull out the pitch-forks and torches yet!!!

Nor plan a water boarding session with your account rep.

The point of this post is to be vigilant to inefficiencies costs and re-invent continually with improvements, gaining knowledge of what you don’t know and managing the agency relationship. Because probably the worst statements are “I didn’t ask” or “I didn’t know.” The information is out there and so are experts that can help.

3 Questions to ask yourself to start:

• Do I understand my advertising supply-chain and all of the parties involved?
• Do I know all of the entities/processes that touch my materials and act on my behalf or my agencies behalf?
• Are there workflows that I can or should take on to be more efficient, reduce costs or have more control?