With the launch of niche agencies and the consolidation of others by the large marketing communications agencies, the field marketing industry has been in a state of flux in recent years. But what has the outcome been for clients, and which agencies are winning the battle for supremacy?
Media communications outfit Omnicom owns CPM, the parent company to field marketing agency Momentum is IPG. Similarly, Headcount was added to WPP's portfolio in July 2003. But David Foster, chairman and managing director of the agency Raisley, says that although these rank among the bigger players still active in the field marketing industry, many others are opting out of their involvement with the sector. The reason, he believes, is that they are finding out just how difficult it is to integrate non-traditional sales promotion techniques with traditional below the line activities.
Not every marketing group agrees, however. Incepta Marketing Services' division director, Susie Vivian, says: "Incepta agencies have implemented traditional field marketing activities for a number of years, with campaigns largely being planned in-house and then various elements of the implementation being outsourced. The creation of Theatre Brand Experience in 2003 negated the need for this outsourcing and is recognition that this area of the marketing mix is becoming increasingly sophisticated.
"Theatre genuinely complements the products offered by a number of agencies within Incepta Marketing Services and as such we are seeing the merits of joint Incepta agency responses to clients, which cover the multi-disciplines of sales promotion, direct marketing, consumer PR and brand experience."
She adds: "Levels of control throughout a campaign, assured in-field excellence and, perhaps most importantly for clients, greater cost effectiveness due to a more efficient supplier chain, all demonstrate a strong rationale for the development of the agency."
Rob Quinn, managing director of Theatre, cites Heinz as an example of a client enjoying the success of this approach. "We worked with Heinz and promotional agency Dynamo, who handled in-store promotion, as well as market research agency Incepta Marketing Intelligence, on the launch of the special soups campaign," he says.
"It was Heinz's biggest experiential campaign to date, with the aim of getting one million consumers to sample the product, and ran from October through to March."
Agency Closer was born out of a similar demand from clients of its parent company, Billington Cartmell (BCL). Closer's managing director, Karen Evans, says it was set up at the beginning of 2003 in response to the increasing demand from clients for live marketing campaigns. "Traditionally the work would have been outsourced to another field marketing agency but we didn't have control over the quality of the delivery, even if we had creative and strategic input," she explains.
Closer works in conjunction with BCL on several accounts, such as GlaxoSmithKline for its Lucozade and Ribena drinks brands. "For Lucozade, BCL handled the promotional work, outdoor advertising and on pack promotions that tied in with the Lucozade Challenge promotion," says Evans.
"We're also working on a live campaign for Unilever's Dove brand that broke at the end of February. It is running in parallel with a BCL project that ties in with the £10m launch of the 'Real Beauty' campaign. Our interactive roadshow enables customers to join in the debate about stereotypes and we are compiling the largest online photo album of real women."
Despite this co-operative approach, Evans is quick to point out that 60-70% of clients come direct to Closer rather than through BCL. "Independently of BCL we work with (chocolate makers) Green & Black's, for example. For the last three years we have run a sampling campaign at concerts and the conversion to sales has been very good. In the first year they saw a 76% uplift and there was no other marketing activity taking place at the same time so it was entirely attributable to the sampling campaign."
Tanya Sergant, managing director of the Arc UK-owned agency Lime, also maintains that 60% of business comes to it direct. Being part of Arc UK, which sits within the Publicis Groupe, offers clients the advantage of being at the forefront of the integrated marketing industry, says Sergant.
"I think this gives Lime an advantage as it's always been driven by integrated marketers and more strategic thinkers who are better able to integrate a campaign if that's what the client wants.
"I wouldn't want to take anything away from the agencies that specialise in field marketing and sampling, but having a background in integrated marketing adds a dimension that other agencies don't have. I think they are trying to make up the difference, though, and there will be a continued expansion into integrated thinking."
PMI, which counts Universal Studios and Samsung among its clients, doubled in size in 2003 and saw 70% growth in 2004, during which time it won 18 new clients including Nokia and Kodak. Its managing director, Gail Tunesi, disagrees with Sergant's analysis. "The one-stop shop approach created a lot of hype at the time but didn't do justice to our ethos. I think it was massively condescending to tell sophisticated clients to park their business with integrated agencies when they know what they want from a specialist," she says.
"PMI is a purely independent agency and our growth over the last couple of years proves that it's a formula that works. With regards to the experiential divisions cropping up in larger marketing groups, there are two ways they are doing this. The first is to set up their own division in-house, which means diversifying into a new arena. The second is to consolidate through acquisitions of specialists in that field. Both methods face problems. I've heard it be compared to arranged marriages. How the two agencies work together has to be so intrinsic and that's difficult to achieve."
But agencies owned by larger marketing groups claim their clients benefit from greater in-house resources. "One advantage we do have over the competition," says Closer's Evans, "is that we have a creative department and can handle artwork in house, whereas quite a few others outsource it. Potentially this makes us more cost efficient but it also means the creative is more deeply rooted in the wider understanding of the brand.
"It's about control. We have the ability to put our own mark on the creative, the print and production and we are less at the mercy of other people letting us down."
Paul Ephremsen, chief executive of the independently owned agency ID, recognises the importance of bolstering in-house capabilities and recently created the role of senior art director within the agency. "What is important to stress is that we don't want to become an integrated agency. We want to be the top live agency and to do that we need integrated capabilities. We're one of the larger live agencies and if we get the integrated bit right, the upside of being an independent far outweighs the advantages of being part of a larger group because we can remain totally flexible," he says.
"I think the biggest downside to being independent is in terms of the financial resources. Without the financial backing, growth is slower," he adds.
Bruce Burnett, i2i's managing director, goes along with this view. He set up i2i five years ago in conjunction with marketing communications agency the Geoff Howe Group, which owns a 51% share. Clients include coffee brand Dowe Egberts and electronics manufacturer Philips - who recently joined forces to promote the Senseo coffee maker - along with cereal giant Kellogg's.
"When I set up the business I had the option to do it on my own but a lot of major clients look for an agency to be financially robust. So I found a partner company, but one that would give me the freedom to operate as I wanted to," he says. "Being part of a larger group was useful when we set up, and where it continues to help is in investment in new technology. It's good to know we have the backing and can take risks and implement new initiatives."
More important than the latest technology, though, is a good rapport between client and agency. Here the smaller independent agencies have an advantage because there is more input at a senior level. PMI's Tunesi says: "We had a meeting recently where the client requested that members of the board attend regular meetings. I sense a growing frustration among clients because they haven't got the level of service or the focus they were looking for from other agencies and it reinforces for me one of the key reasons we set up PMI."
Nick Adams, director of new agency Sense, which already boasts yoghurt brand Muller as a client, also sees delivery as the key issue. "Few clients will continue an unsatisfactory relationship purely because the agency is part of their main agency. Depth of expertise, quality of project management and personal chemistry will prevail," he says.
Lime's Sergant thinks independent agencies will find it harder to win new business as the market becomes saturated. "As the big groups get bigger, I wonder how easy it will be for smaller agencies to withstand the pressure. I hope they do, I wouldn't want to squeeze them out as I think it's healthy for the market, but the more political relationships there are, the more briefs they won't get a look at," she says.
Burnett from i2i adds: "In terms of pitching we are up against more people and it's more competitive and aggressive. One of the advantages of those within larger networks is they have the resources and can spend time and money on a pitch without having to buy services in. Clients have greater expectations and want a more finished product. But the area is still quite new and there are a lot of companies working on their first experiential campaign."
ID's Ephremsen also remains bullish. "I'm not particularly worried. The main agencies at the top of the field are the independents, the likes of us and RPM. In my view the best agencies are still the independents. If that ever changed and we were playing second fiddle to the offshoots of larger agencies I would be worried and that would be the time to put the 'for sale' board up. But if we focus on keeping our own business in order there is plenty for everyone," he concludes.
SENSE: 'A PRAGMATIC APPROACH TO LIVE COMMUNICATION'
Formerly managing director at Lime, Nick Adams and his partners Bruce Gardner and Richard Adams set up Sense in February 2005. "It was always a career ambition of mine to set up my own agency and Lime provided the perfect grounding in gaining the right experience to launch and run a successful independent agency," says Adams.
Sense's unique selling point, according to Adams, is its common sense approach. "Sense will differ from other agencies by taking a pragmatic approach to live communication - not creating 'sexy' brand experiences for the sake of it, but delivering appropriate activities which fulfil the brand communication and financial objectives."
He adds that the partners' background in integrated, below the line marketing gives them an advantage: "We firstly seek to understand a brand's personality and how it can connect emotionally with the target consumer. Only then do we create live marketing programmes which truly complement the overall communications plan."
Although it is independent, Sense has developed strategic alliances with large marcoms groups such as Zenith Optimedia and is a member of the Live Brand Experience Association.
WHSMITH INSTORE FIELD MARKETING: 'GOLD CREDENTIALS'
Wholly owned by WHSmith Group and employing 400 permanently contracted field staff, Instore Field Marketing operates as a free agent within the retail market, delivering more than 10,000 activities a week in 3,000 retail outlets. Clients include some of the biggest grocery multiples and their suppliers.
"We have solid gold credentials in retailing, which is perhaps what you would expect as we are owned by one of the major high street players, but we can offer our expertise freely to other retail chains," says Instore managing director Richard Finch.
In the five years since it was formed, the firm has grown substantially.
"We're a medium sized agency, supported by industry leading technology, but with the flexibility and speed more commonly associated with smaller companies," says Finch.
He adds that transparency is a priority, and that the agency conducts a customer satisfaction survey to store level each year and feeds the results back to clients. "Almost all our new business is through referral," he says. "I believe this degree of transparency is one of the cornerstones of our relationship with clients. They want to see a return on investment, we want to be judged by our service and results."
ZAK FACTA: 'WE HAVE THE RESOURCES TO DELIVER'
Zak Facta was established by managing director Paul Jeffries in 1994 with a remit to provide creative and effective brand experience roadshows and events. Its long-term clients include Virgin Mobile, Barrs Soft Drinks' Irn Bru, Ovaltine and Sara Lee.
Jeffries believes the agency is unique because it has an in-house build facility that enables it to take a concept from design through to production, planning and on to implementation.
"As everyone knows, it can be difficult to find reliable suppliers. When I had the opportunity to acquire one of our build suppliers I thought it would be a good opportunity to control delivery and ensure quality was up to standard," says Jeffries.
Zak Facta's build division also supplies other agencies in the sector, such as Loewybe and ID. "Because we have an understanding of delivery and implementation of projects for our own clients, we understand what works and what doesn't," he adds.
"Clients and agencies never really fall out about anything other than service but an agency of our size has the resources to deliver."