Ad Agencies: Don’t Underestimate Your Competition

In today’s Wall Street Journal, Nick Brien, CEO of McCann Worldgroup, said that the ad agency giant’s biggest competition is media companies like Meredith Corp.

 It turns out that Meredith, which does direct marketing and social media for Chrysler, beat out McCann for part of the auto maker’s business.

 “If you don’t recognize who you competition is, you will underestimate them,” Brien told The Journal.

 And in times as intensively competitive as these, you really don’t want to do that.

 Ad agencies aren’t the only ones feeling the heat.  Now PR firms either are – or should be – looking increasing their expertise in social media.

Earlier this month the Dallas Business Journal ran a story by Web Reporter Kerri Panchuk about how the PR landscape has been changed by social media advertising/marketing, and how local PR agencies are responding.

  •  “In our business-to-consumer group, social media is getting to be at least 25 percent of our business,” says Michael Burns, CEO of public relations firm Michael A. Burns & Associates Inc.  “We are diversifying our services based on what our clients want from a PR agency.”
  • James Hering, a principal at The Richards Group, tells the Dallas Business Journal that many of his clients allocate about 70 percent of their marketing budgets to digital and online initiatives.
  • As further confirmation, Michael Crawford, president of a M/C/C, an advertising and PR firm, estimates that 60 percent to 70 percent of his revenue now comes from digital work.

I suspect these Dallas agencies are pretty representative of what’s happening nationally and internationally. 

If your ad agency isn’t getting on board the social-media train, consider these parting words from The Winterberry Group,  a consulting firm that helps advertising and marketing companies grow shareholder value:

“Spending in the online marketing segment is expected to increase to $8 billion by 2012.”

Don Beehler provides public relations consulting services to small- and medium-sized advertising agencies and businesses.

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