SoDA

April 16, 2014 08:00 ET

SoDa Report Reveals Changing Face of Client Agency Relationships

NEW YORK, NEW YORK--(Marketwired - April 16, 2014) -

www.SoDAspeaks.com

SoDA, the voice of the digital agency and production community, has released the 2014 edition of The SoDA Report, which includes its annual Digital Marketing Outlook survey of the changes taking places across the industry.

The findings reveal key shifts in marketer/agency relationships, weaknesses in advertiser expertise, and mismatches between what advertisers and agencies believe are most valuable to clients. There are also startling perception differences over clients attempts to transform their business, and disconnects over why clients walk away from agencies.

The research also highlights steep learning curves inside agencies when it comes to acting on data insights, as well as using digital information to propel deeper personalization. As clients increase investment, agencies need to stay ahead in data, mobile and product innovation.

Conducted in partnership with Econsultancy, Digital Marketing Outlook is based on a global sample, evenly split between advertisers and agencies, which represent a total annual marketing spend of $25.4 billion. There were 736 respondents, the majority being senior company decision-makers.

Summary

  • After years of dramatic growth, half of marketers kept digital budgets level in 2014, up from a third in 2013.

  • There was a rise in spend on non-marketing initiatives, including data, mobile and product innovation, with one in three clients increasing these budgets.

  • Nearly 70% of clients believe being seen as an early adopter is key or important to their brand position.

  • Clients are increasingly seeking specialized digital services from agencies rather than looking for a traditional agency of record.

  • Agencies believe advertisers still lack digital talent, with 50% highlighting gaps in paid-, earned- and owned-media strategy and execution.

  • User experience is the biggest gap on the client side with 77% of agency respondents citing it as a weakness.

  • The number of advertisers working with zero agencies has risen for the second successive year, with 13% managing digital in-house (slightly up on 2013).

  • Agency leaders concerned about off-shoring jumped almost 10%, up from 22% in 2013 to 31% in 2014.

  • Agency leaders identifying commoditization of digital product work as a serious problem rose 9% on last year.

Chris Buettner, SoDA executive director and managing editor of The SoDA Report, said: "Increasing levels of sophistication and elaborate in-house digital teams do not have to translate into diminished revenue for digital agencies. The opportunity is in data, mobile and product innovation - areas of high demand."

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