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Who Should Do The Work?

By Tim Young, President

Would you hire your Advertising Agency to do your Experiential Marketing? Believe it or not, it is true. At least according to the 13th annual IEG/Performance Research Sponsorship Decision-makers Survey published in the IEG Sponsorship Report on April 22, 2013.

According to IEG, it is true based on those marketers that responded to the survey. Of those who responded, 63% said they use an Advertising agency to support their sponsorships, while only 60% use a Marketing agency. Only 23% of companies manage sponsorships entirely in-house. Going back to 2009, that number was nearly 50% who managed everything in-house.

Which type of agencies do you use to support sponsorships?

This raises more questions than answers. It isn’t surprising to see companies shift their work out to an agency with all the downsizing that has taken place since 2009. What is surprising is that somehow, Advertising agencies have become the catch-all group. Advertising agencies have evolved, and now they could encompass the following experts.

  1. Advertising
  2. Strategic Planning
  3. Creative
  4. Digital
  5. Social
  6. Experiential
  7. Sponsorship
  8. Etc.

While many agencies certainly have all these experts, many other clients have dedicated agencies for each of these examples. Few advertising agencies have their arms wrapped around these moving parts. Is it easier to use one agency for everything? Probably. Are you putting your best marketing foot forward in doing so? Probably not.

Facebook went from nothing in 2004 to a bazillion users today. That same year, Google opened its IPO. Twitter was just a glimmer. Experiential marketing was called Promotions. Look how much has changed in the last nine years. Owning and being an expert in these marketing tools is next to impossible.

According to IEG, sponsorship spending is expected to hit $20 billion this year in North America, up 5.5% over last year. Advertising is only expected to grow by 2.6%, so maybe this is just an attempt to keep or hold on to a more significant piece of the pie. As clients evolve, they see a greater need to put their product in front of the people. As we say, you can’t DVR a live event and skip the commercials. So, it could be considered one of the most important strategies you have to market your product.

Go to the experts to help. One of Southport Marketing’s key pillars in its business is to help agencies become experts in this space. Some of our most significant revenue sources are, in fact, agencies and their clients. Delivering actual value by helping blend an advertising strategy with an experiential approach is where clients find value. They lean on us to provide that expert analysis and flawless execution for their clients.

Sports gets 69% of the sponsorship spending this year, but is that the best place to gain quality customer interaction? Festivals only get 4% of the annual sponsorship spend. Ticketed, timed events (sports) are often tricky to activate. Festivals provide a relaxing environment for the consumer. Sponsors can have a much more meaningful conversation with consumers in this setting. It would be similar for the Ad guy to spend his money on NBC or AMC. NBC will reach the masses and cost more, but AMC might be more impactful.

There’s no question that the media is still the big dog and gets the most money to market. So clearly, an Advertising agency should be driving the strategy bus. The best blend is to bring in dedicated experts and fill the other digital, social, and experiential marketing tactics.

Would you hire an Experiential Marketing Agency to do your Advertising?