Skip to Content

Google and 4A’s commissioned a study to explore how brands and agencies can work together to accelerate growth in the year ahead. Marla Kaplowitz, president and CEO of 4A’s, shares her thoughts on the findings and implications for the industry.

In a stylized illustration, two people work together to assemble a life-size puzzle.

In 2020, health care, economic, and social crises disrupted all our plans, prompting brands and agencies to recalibrate their relationships. Those that worked together, focusing on resilience and transformation? They not only weathered the storm, but came out stronger.

This past year, I’ve seen agencies achieve tremendous client satisfaction by leaning into areas where brands critically need support. In a world that remains uncertain, there’s a huge opportunity for brands and agencies to partner and prepare for the year ahead.

To explore this evolving dynamic, we partnered with Google on a new study conducted by Forrester Consulting.

To me, the findings are clear. As we enter another fast-paced year, strong brand-agency partnerships will be instrumental to driving growth and preparing for whatever’s next. Here are some of the key ways agencies can become exceptional strategic partners in 2021 and beyond.

Embrace automation

I’ve heard from some agencies that they’re skeptical about automated solutions, but our study shows that brands are increasingly looking for agencies to inform their automation strategy and vision. A staggering 86% of brands say they’re not very effective at leveraging technology to automate aspects of their marketing, and only 1 in 3 have connected automation to growing revenue. Clearly, there’s a lot of potential for agencies to own and become leaders in this space.

Adopting automation can be game-changing for several reasons. For starters, it enhances brand-agency agility to respond to consumer demand in real time, optimizes campaigns, and improves performance — all of which are increasingly critical as behaviors shift and the path to purchase becomes less linear. More importantly, it frees up time and resources for agencies to focus on the strategic, high-value work and data-driven best practices that deliver the greatest value for their partners.

Brands should empower their agencies to codevelop a vision for automation so they can meet consumers in the moment and get ahead of the curve.

Automation isn’t a cost-cutting exercise, but an opportunity for growth. And there’s never been a better time to experiment, test, and learn, for agencies and brands alike. Right now, brands should empower their agencies to codevelop a vision for automation so that together they can meet consumers in the moment and get ahead of the curve.

Evolve and expand services

Brands are looking for support across the board. For creative services and content production alone, they expect to increase agency work by over 20% in the next three years. To meet these growing needs, I’d advise agencies to not only strengthen their current offerings but consider delivering completely new services as well.

In addition to increased creative resources, agencies should invest further in their insight curation and measurement capabilities. According to our research, nearly half of brands find it challenging to effectively use customer data; 1 in 3 find it challenging to make their insights actionable; and 46% say their inability to measure ROI from marketing initiatives is a top challenge. Agencies can help brands uplevel this skill set, get closer to their customers, and drive business outcomes. Now’s the time to expand or implement data management, analytics, and measurement solutions.

An illustrated tape measure icon pairs with the stat: 46% of brands say their inability to measure ROI from marketing initiatives is a top challenge.

In providing new services, there is clear white space for agencies to diversify their offerings. Take e-commerce, for example. The events of last year drove explosive growth in online shopping, and brands are looking for expanded capabilities to support this increasing consumer preference. The deprecation of third-party cookies and shifts in consumer privacy regulations has led nearly half of brands to reduce their dependence on technologies that use third-party data, and they’re eager for new ideas to deliver personalization at scale. Savvy, forward-looking agencies have already begun investing in or acquiring new first-party data solutions to provide brands with a single view of the customer. In practice, this allows brand-agency partners to work together to understand audiences, identify value, and, crucially, create better customer experiences.

Reimagine compensation models

Brands and agencies are rethinking the agency economic model, from paying for people to paying for platforms and performance.

To me, this shift reflects the increased focus on driving business outcomes coupled with the ongoing struggle for brands to measure ROI. Another recent Forrester Consulting study showed that 51% of brand decision makers in EMEA will prioritize and select future agencies with a track record of helping clients achieve growth, compared to 33% before the pandemic.1

While the most frequently used compensation models are still retainer and project based, both brands and agencies anticipate this will change significantly over the next three years toward licensing- and performance-based options. By working together to develop new, nontraditional compensation models, brands and agencies can strategically align on what works for both of them, presenting greater value and long-term sustainability.

Moving to outcome-based compensation reflects a prioritization of high-value, results-oriented partnerships that drive growth — and that’s good news for agencies, as well as brands.

By developing new compensation models, brands and agencies can strategically align, presenting greater value and long-term sustainability.

It’s clear that brands need strategic agency partners now more than ever to help them keep pace with the rapid acceleration of digital. While agencies should look to develop expertise, invest in tech, and upskill talent, brands can empower them by sharing first-party data and bringing them into strategic conversations sooner. This will help both brand and agency partners be ready, together, for whatever 2021 has in store.

Meet the brand-agency partners who are getting ready together in 2021, and download the research to read more.