New biz soars as clients overhaul DM

Direct agencies are witnessing a new business boom as client companies increasingly seek out their expertise to build a much more robust customer centric experience for consumers.
The move has trigged a 44% increase in the number of CRM and direct marketing reviews in the first half of this year, according to the AAR’s New Business Pulse Survey, with the likes of Halifax, Majestic Wine, Moneysupermarket, National Express, News UK, SSE, Three and DFS hunting new agencies.
The DM market is in sharp contrast to other sectors, with digital advertising pitches down 20% compared to the same period last year, and those for advertising accounts down 10.8%. Integrated pitches were the only other to witness an increase, by a modest 5.5%.
While some may see the rise in DM reviews as bad news – after all, most agencies would rather grow existing clients than go through an expensive pitch process – AAR managing partner Tony Spong believes it is welcome news as there are a number of factors in play.
Spong, who runs the DM and CRM side of the business, said: “Many clients mirrored agencies in setting up separate digital teams five to six years ago in order to develop skills, knowledge and understanding on how best to exploit the opportunity digital innovation was providing across distribution, price and communication models.”
Spong said that brands are now consolidating this knowledge by integrating their on and offline teams and this has been most evident in the area of CRM in its broadest sense.
He explained: “Brands are now looking to adapt their strategy, which in turn will inform the way they store and manage data, which in turn drives the ‘pipe work’ needed to deliver the right message to the right person at the right time.
“The only delay in all of this has been the recession, so the briefs we are seeing have been more or less seeking to address all three areas in one in order to deliver a much more robust customer centric experience for the consumer. I think we should consider this as a sign of confidence that the recession is easing as brands start to spend on ‘cap ex’ infrastructure type projects rather than merely tactical activity to paper over the cracks.”