Peter Levitan & Co.
The New Business of Advertising
Chances are that we’ve met before or at Advertising Week New York and I handed you the card on the left. Thanks for heading over to this page (and for following instructions.)
Now, here is what you need to do.
Go read my three-part thought-piece on the art of advertising agency brand positioning. That’s where you will find the 24 Ad Agency Positionings I promised.
Is this the best beer TV commercial? Like ever?
Its from Colenso BBDO in Auckland (that’s New Zealand to my geo-challenged American friends.)
https://www.youtube.com/watch?v=Nxic89dnuTk
Is Anyone Interested in Investing In Your Advertising Agency?Way back in 2013, I wrote about Bend, Oregon’s specialist ‘advertising agency’ G5. I wanted to show you, Ms. Agency CEO, that there are advertising agency business models that actually:
Attract high-margin clients
Are more efficient than your project-based approach
Are category specific. This is their pitch: “G5 simplifies digital marketing by delivering best-in-class sites, search, and social for Apartments, Self Storage, and Senior Living properties.”
Are unique in a world of me-too agencies
Leverage the power of marketing tech to help clients and grow your bottom line
And… increase agency valuations. You do wnat to sell someday, right?
Way back in 2013 you had to take my word for it. Not anymore. I was right.
Digital marketing firm G5 has raised $76 million from a private equity firm.
The figure is the largest Oregon investment round this year. According to investment research firm PitchBook, the next highest round was $22 million for the New York and Portland-based biotech firm Schrödinger. Urban Airship raised $21 million and Jama Software raised $20 million.
The Bend-based company offers a digital marketing platform for the apartment, self storage and senior living market segments. Peak Equity Partners, which is taking a majority stake in the company, led the round. CEO Dan Hobin declined to name other investors in the deal.
BEND, Ore. (August 12, 2015) – G5, the leader in maximizing digital marketing effectiveness for the property management sector, today announced the closing of a $76 million investment led by Radnor, Pa. based Peak Equity Partners, a private equity firm focused on the enterprise software market. The investment enables G5 to build on its ten year history of growth and innovation by accelerating feature development of the G5 Marketing Cloud – the most innovative, scalable, and up-to-date digital marketing platform in the property management sector.
When the digital agency G5 was launched in Bend Oregon in 2005 (my agency Citrus had offices in Bend and Portland), I wondered if their SEO oriented business model was going to succeed. As you can see, it did.
G5 is, if anything, a highly focused agency. They chose not to be one of the thousands of “full-service” agencies that are designed to meet virtually any client’s needs and ultimately wind up with a somewhat mushy sales proposition and inefficient business model.
G5 provides software and services directly to the large national property management sector which includes multifamily, senior living, self-storage and student housing. They call their service Digital Experience Management (DXM) and they offer an audacious promise: they promise that they will deliver client properties “within the first five organic SERP listings on Google.” In the active property management category, having a high SERP is a promise that can’t be refused.
G5 works it. In addition to their original SEO service, G5 now offers suites of services that include a Discovery Suite (SEO / SEM): Reputation Suite, Conversion Suite (websites, lead tracking, applicant screening), Retention Suite (CRM) and the Insight Suite (analytics.)
These targeted services allow G5 to pitch a compelling benefit story to prospective clients. Take a look at G5’s Solutions page to see how a set of services can be applied to multiple clients in each of their target categories. Like efficiency? This pitch can be repeated over and over.
What Works?
Add Central Oregon’s outdoor lifestyle and you have a profitable, smart, narrowly focused agency staffed with national talent that gets to live 25 minutes from great skiing. That’s Mt. Bachelor in the background.
… And One To Help Go Get That Car
As an addendum to my Advertising Week Social Club “Dreaming of a Car Account?” interview with Nielsen’s Ian Beavis, I offer some more thoughts on why you should go after a car account.
Not that you didn’t know this but these guys spend big bucks. According to Kantar Media, in 2013’s first quarter alone, automotive manufacturers spent $1,971 billion and $1,381 billion respectively on manufacturer and dealer advertising.
According to Ad Age, General Motors spent $3.59 billion on advertising last year while Toyota spent $2.86. For contrast, Hyundai and Kia spent only $776 million and $1.26 billion.
Again, no surprise that auto accounts use all types of media, which offers agencies of all stripes the opportunity to customize services for manufacturers and dealers. According to Ads24’s most recent Path to Persuasion (P2P) Wave 4: Automotive (passenger cars), “Usually, the most effective media mixes include media formats that play differentiated roles across the Path to Persuasion.”
Just as a reminder… Has anyone not seen Audi’s “Prom”?
https://www.youtube.com/watch?v=ANhmS6QLd5Q
Or, Volkswagen’s “The Force” (with 58 million YouTube views)?
https://www.youtube.com/watch?v=R55e-uHQna0
Or, Kia’s “Hamster Rap”?
Or… Chrysler and Eminem?
https://www.youtube.com/watch?v=SKL254Y_jtc
Toyota has been with Saatchi & Saatchi (nee Dancer, Fitzgerald, Sample) since 1975. Car accounts are hard to move.
“A car account always has been a rite of passage in the world of agencies,” said Jon Bond, co-chairman of Kirshenbaum Bond Senecal & Partners. “It’s like being a made man in the Mafia, but … today, you can get whacked the next week.”
Two of the more interesting questions and answers from my interview with Ian Beavis, EVP Automotive at Nielsen and ex auto CMO point to the fact that agencies can find a wedge service into auto accounts. Go for it boys.
Levitan: A final question. Agencies have a hard time creating a competitive agency brand positioning. Any insights and advice you can give to the agency world on how to be distinctive in this highly competitive category?
Beavis: You rarely hear of an agency being a business solution provider, as it just doesn’t sound cool or creative. A good agency solves a client’s business issues and is a partner. Very few qualify and even fewer truly embrace this challenge.
Levitan: What are the current digital hot buttons at car companies?
Beavis: Quality lead generation and follow up. It is the top priority with all OEMs
So, be smart, be distinctive, be a problem solver… get going.
I’ve been on an interview trip lately. I’ve done a couple of soon to be published interviews with industry leaders for Advertising Week Social Club and Agency Post. More are on the way.
One major point I keep hearing is that advertising agency specialization is key to breaking out of the me-too agency positioning malaise. Specialization is one way to get to a more powerful (i.e. relevant, impactful, efficient) new business program.
In my Advertising Week interview with Ian Beavis, Nielsen’s EVP Automotive, on how agencies can win an auto account, he mentions that most advertising agencies do not act as a business solution partner,
“You rarely hear of an agency being a business solution provider, as it just doesn’t sound cool or creative. A good agency solves a client’s business issues and is a partner. Very few qualify and even fewer truly embrace this challenge.”
In another for Agency Post, Rich Sullivan, the CEO of Alabama’s RedSquare Agency, discusses how RedSquare has specialized in casino marketing with growing success.
I’ll let you know when both of these are published.
On to today. I was looking at a new list of Seattle’s largest agencies and noted that Taphandles, the fourth largest agency in Seattle, specializes in, get this, beer. I’m not sure that I’ve ever heard of Taphandles and I am just down the road in Portland. I was intrigued.
Taphandles’ Twitter profile @taphandles describes the agency as:
“We know beer. Logos, taphandles, signs, displays, package/label/web design, glassware and all things POS… Let us help you sell more beer.”
There are a few things that work with this positioning. A key factor is that Taphandles has zeroed in on a fast growing category. Here are some stats from the Brewers Association.
Taphandles is well positioned to, yes, tap into the market due to its strong support for their beer expert positioning. They started out designing and manufacturing taphandles for most of the major beer brands. I love their concise story that has to grab the attention of beer clients.
“Since we opened our doors in 1999, we have worked with almost every beer brand worldwide, which has given us comprehensive understanding of competitive landscape, and appreciation for what it takes to build a successful brand. This experience makes us uniquely able to help breweries tell their stories effectively through the brands we design, and the merchandise we make.”
Clearly Taphandles has grown into a full-service provider by building on their taphandle design experience. But, there is something instructive here for all agencies.
Pick a growing category, learn it, own it and then you’ll be able to hammer it on your home page.
