Are the days of dedicated CRM agencies numbered?

Lida (UK) is latest specialist to cease to exist as stand-alone entity.

CRM: decline in specialist agencies (Getty Images)
CRM: decline in specialist agencies (Getty Images)

The first head on the block was OgilvyOne, which merged into its parent company in early 2018 as part of the not-confusingly-named One Ogilvy operating structure.

Later the same year, its WPP stablemate Wunderman joined forces with its (much) older sibling J Walter Thompson to form Wunderman Thompson.

And with the news that Lida has now been rolled into M&C Saatchi, we have reached the point at which three of the six agencies to have scooped Campaign’s Direct or Customer Engagement Agency of the Year award in the past decade have ceased to exist as independent entities. 

So it this a one-way street? Well, not necessarily. For a start, while Lida will no longer exist in the UK, the brand will continue in the US and Australia. Meanwhile, Campaign’s 2016 winner, TMW Unlimited, survived as a stand-alone brand during a 2018 restructure of its parent company Unlimited, while Proximity (2015's winner) has established itself as an network independent from BBDO. 

(The final agency of the six winners is 2010's EHS 4D, now part of Havas Helia – which also continues as a stand-alone brand.)

So what is the right way forward for agencies offering CRM services?

Steve Aldridge

Chief creative officer, Wunderman Thompson UK

The days aren’t numbered just for dedicated CRM agencies. They are numbered for any organisation dedicated to one specialism. In the world we now live and work in, clients don’t have time or budget to manage lots of different specialist agencies. They are looking for a communications and growth partner to take responsibility and deploy expertise where and when it’s needed; from brand creation to the retail experience, multichannel communications, with social, data and tech solutions. What is now needed are experts and specialists within an organisation who can work together and flex their skills across the end-to-end consumer experience.

Chris Mellish

Chief executive, TMW Unlimited

Historically, brands have believed they need one agency for big creative challenges and other agencies to deal with complexity – CRM, digital, social, data etc. But the world has moved on and consumers demand a seamless communications journey. Channels need to work together, much more than matching luggage. Understanding this complexity and balancing it with genuine creativity is what counts. An agency with a heritage in CRM, that has evolved their offering in line with customer behaviour, will today find themselves in pole position – a modern one-stop solution. But if CRM is still all you know, I suspect your days are numbered.

Camilla Kemp

Chief executive, M&C Saatchi

Dedicated CRM is more essential than ever. Dedicated CRM agencies aren’t. Making CRM expertise part of a bigger ecosystem allows for the critical joining-up of understanding how brand impacts customer value and how customer communications and experience impact on the brand. Our experience is that clients increasingly start with the business problem they are looking to solve, rather than the agency specialism. That doesn’t mean marketeers don’t need specialisms; world-class specialist expertise is vital, from influencer marketing to customer communications to sponsorship. They want a partner who understands the total picture and can pull relevant specialisms seamlessly together, as needed.

Michael Frohlich

Chief executive, Ogilvy UK

CRM and customer engagement services require specialist knowledge, with the most powerful experiences being those that are plotted and created whilst thinking end to end. Any successful project requires the input of experts who understand how to build customer relationships, how to use data and how to personalise – but this must all be thought about within the context of the overall experience the customer is receiving. Integration helps ensure that the experiences you create are consistent and streamlined, that they are able to bring data, creativity and tech together in a way that makes the content you build both tailored and engaging.

Chris Pearce

Chief executive, MRM McCann

Far from it – at least not for the good ones! The skills required to successfully acquire a customer, ensure a great first experience and then develop an enduring, memorable and profitable relationship are myriad.  A generalist couldn’t hope to have the depth of resources or be as effective as a specialist. Best-in-class CRM agencies see beauty in data, harness the seeming magic of technology and relish the power of creativity to create meaningful relationships. Does this mean they work in isolation? Of course not. The very best integrate seamlessly with other agency partners to unlock lifetime growth.

Adam Fulford

Chief strategy officer, Proximity London

The short answer is "absolutely". The days of pure-play CRM agencies have long been numbered.  Today, customers want a consistent, relevant experience in any channel they want to engage. Digital, creative and media agencies have increasingly played in this area. Agencies must evolve or die. That’s why TMW has consolidated, Wundermann has merged with JWT, Rapp focuses on individuals, not (just) customers, and at Proximity we deliver connected creativity across every channel. Adtech investment means the future of advertising is personal. Data-driven experiences at scale: the CRM agency’s heartland. While traditional CRM is dead, advertising has never needed those skills more.

Xavier Rees

Chief executive, Havas London and Havas Helia

No. There will always be demand for specialist customer engagement agencies – and the discipline has never been more crucial, nor its influence greater. Lida, sadly, is the latest casualty of "integration" driven not by strategic nous but commercial necessity. In these merged entities, the dominant culture will always win out – the majority of the time in favour of the more established advertising brands and to the detriment of their customer engagement expertise.

As such, I firmly believe in the need to protect specialisms while simultaneously blurring the lines between them. After all, clients buy brands – and they want both generalists and specialists, not one at the expense of the other. Agencies must excel in their discipline, while figuring out how to better collaborate with their partners. You don’t need to merge to do that.

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