Get a demo Do I subscribe? News sign-up
Print

Why brands are expanding investment in performance agencies

News, 20 July 2017
Topics

NEW YORK: As big brands move more media budget to digital and the upper funnel becomes more measurable, performance agencies are reaping the rewards.

The change reflects the direct returns that brands now expect to see from every marketing investment. “Clients need to know that a brand-building effort led to a revenue outcome,” Michael Kahn, CEO at Publicis’ performance agency, Performics, told AdExchanger.

Pressure has been building on CMOs to prove that every marketing effort is driving revenue. In tandem, a shift toward ecommerce platforms across the globe has made it easier to compare digital marketing output to sales, Kahn went on to say; a knowledge of what works is now bringing performance considerations into branding.

He added that the agency has a body of “transactional data that can deliver information for creative briefs, geographies and areas of focus,” that has the potential to improve targeting, while ensuring ads are relevant to the consumer when they are at their most receptive.

“It’s using what we’re seeing in the marketplace to drive a performance outcome.”

The glut of first-party data now going to performance agencies has meant that they are well placed to attribute certain content to a transaction. “Engagement metrics tied to purchase is among the most interesting things a brand can look at today,” said Anne Bologna, CSO at iCrossing.

However, getting to the high level discussions has been difficult, with the brands themselves struggling with outdated technology and data necessary for measuring ROI.

“On a scale of one to 10 in this industry, we’re probably at a three in terms of being able to measure full-funnel attribution,” Bologna said. “But the ability for us to get there is accelerating.”

The trend is changing the way some media agencies think of their own roles. Last year, Zenith broadened its offer to help clients organise data, supplement third-party data from partnerships, and optimising a brand’s ad tech stack.

“We’re helping [brands] match data and tech solutions,” Vittorio Bonori, Zenith’s global brand president, told AdExchanger. “We’ve never seen it before.”

Data sourced from AdExchanger; additional content by WARC staff

Topics