Gartner’s Magic Quadrant: Agencies Must Adapt In The Face Of New Competition

Gartner Magic QuadrantPublicis Groupe's Publicis.Sapient platform was a big winner in Gartner Research's ranking of digital agencies, released Friday.

Publicis.Spaients's three digital agency brands, Razorfish, SapientNitro and Digitas LBI were recognized as “Leaders” in the research firm's Magic Quadrant for global digital marketing agencies. Gartner reserves the Leader designation for companies that exhibit both completeness of vision and ability to execute.

Razorfish was rated highly for its ability to adapt, take risks and collaborate, and SapientNitro for its innovation in analytics and digital commerce. DigitasLBI was noted for strategic technology partnerships and in-house media expertise.

Interestingly, Gartner’s quadrant recognizes a number of management consultancies and technology firms that would not at first seem to qualify for the report.

For instance, Deloitte Digital and PwC Digital Services were named as top “Challengers” in the space, due to their strategic business expertise, technology partnerships and multichannel marketing. Accenture was recognized as a “Visionary” on the cusp of market evolution in terms of collaboration and digital commerce.

“The landscape is certainly in flux,” said Gartner analyst Jay Wilson. Traditional agencies, management consultancies and technology firms are all “vying to become the confidant of the CMO,” he said.

On the technology services side, IBM Interactive Experience came out as one of the top four Leaders due to its advanced marketing capabilities, creative talent and ability to service the changing needs of the CMO.

“The traditional agencies will need to evolve from being marketing experts focused on marketing KPIs to business experts focused on business KPIs,” Wilson said. “As the CMO role broadens, [agencies] have to bring different parts of their organizations [that satisfy] different requirements. That’s why you see the consulting firms and tech firms getting a leg up.”

Gartner also highlights the need for greater agility and collaboration among agencies as the agency of record (AOR) model disintegrates. Traditionally very protective of their client relationships, agencies will have to get over that.

“When we talked to clients of these agencies, one of the things they really valued was ‘How well do they collaborate with our other partners?’” Wilson said.

The report also notes that independent agencies are better positioned to thrive than their holding company brethren, as clients curate a stable of outsourced marketing partners. Stand-alone shops are generally more flexible and cooperative.

Finally, on tech investments, Gartner advises digital agencies to take greater financial risk, regardless of whether they can pass those costs along to their clients – something they’ve relied on in the past.

The report analyzed digital agencies with global reach and global annual revenue of at least $175 million. Qualified agencies provide a full service offering across strategy, creative, technology and measurement, and they have acquired at least five new clients in the past year.

 

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