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THE END OF THE AOR MODEL

Kashi Go Social-Native-142029-20191217

Content created for Kashi Go



Circle Yellow

 

As long as we can remember,
the brand-agency relationship has been a committed marriage.

As a brand, the search for your Agency of Record can take years, multiple RFPs and an entire team deciding the near and long-term values of the partnership.

Unlike your short flings and fun pilots with new vendors here and there, your Agency of Record is around for the long-haul and is expected to know and value your brand’s position and needs just as intimately as you do.

When the marketing and advertising landscape was shaped by traditional, mass approach modes of communication, the Agency of Record model was any brands’ golden ticket to success. However, the average length of an agency relationship has been steadily declining from a high of 7 years to less than half of that today.

Consumers today are more aware of the power of marketing than ever before.

From social media to eCommerce, the ways in which brands connect with consumers have evolved, and the quickly changing on-demand digital landscape has left traditional agencies struggling to keep up with shifting consumer needs and technological advancements at scale.

As a result, many brands have been changing their go-to-market approach as cracks in the traditional brand-agency model have started to show.

In an interview with Social Native, Nick Jacroux, Head of Brand Marketing at CAULIPOWER suggested that agencies can no longer provide a one-stop-shop solution and explains the 3 main reasons the brand has had to rethink its relationship with agencies:

Time

In today’s environment, brands move fast. Most traditional agency partners don’t move as fast as brands can and will. They often have a slow turnaround and for better or worse, we just don’t have time to spare.

Insight

Nobody knows a brand better than those who build it. It’s crazy for any client of any brand to think that the same agency partner is going to get it right every single time.

Cost

Certain groups are better at doing certain things. A traditional creative agency, for instance, can't scale high volumes of UGC content for social. Work needs to be allocated based on skillset to ensure maximum productivity and performance.

Content created for Sony Home Entertainment

Puzzle

Brands must implement thoughtful, innovative strategies to resonate with audiences in meaningful ways. The birth of specialized project-based partnerships and the power of digital communities presents a viable solution.

Direct-to-consumer brands paving the way

With a focus on minimalism, customer experience, and authenticity, beauty brand Glossier’s internal team outsourced their pre-defined requirements on a needs-basis to a mixed selection of specialized vendors rather than turning to a one-stop-shop for all of their needs. Now valued at over $1 billion, it’s clear they’re doing something right.

It is not surprising, then, that some of the other most successful DTC giants of 2019 adopted a similar shop-around approach to brand building over the traditional AOR model.  Casper, Warby Parker, Everlane, and Brandless all opted to work with a variety of smaller specialists from the get-go including Red Antler, Partners & Spade, and Gin Lane rather than limiting themselves to a single Agency of Record.

The rise of project-based partnerships

Agencies must embrace a project-based approach and ditch the safety of a full-service, multi-year contract approach as the landscape continues to evolve and progress at unprecedented rates.

A great example of a brand and agency working together to re-imagine the traditional model and leverage specialized partners to fill gaps is Sony and UM. To promote the release of Angry Birds 2, Sony had two main goals: fill movie theaters for their single-day screening and create high-quality content to use across their paid channels.

The team partnered with Social Native to activate 125 families to go to the movie premiere and create content capturing their experience. UM used UGC to create a video compilation to use across their media buys including Facebook and TV. Such a large scale micro-influencer activation would have been cost and time prohibitive for Sony or UM to run in-house, so bringing in a specialist allowed them to focus on the overarching campaign strategy and execution.

AOR Approach

 

 


AOR Model

 

 

 

Multi-Agency Approach

 Multi-Agency Approach

Sony User Generated Content Example

Content created for Sony

Power of Many Yellow

The strength of many is proving to be more valuable every day.

Specialization for maximum efficiency

Brands no longer have to choose a single agency to allocate their budget to and can embrace the power of multiple perspectives with a project-based approach to their campaigns.

The more partners specialize in the segments of marketing they know best, the better the brand can leverage them to execute specific objectives and goals. By having an open mind, embracing new ways of doing business, and thinking beyond the scope of outdated methods of marketing, both brands and agencies can stay ahead of the curve in 2020.

Litehouse and Crafted Communications are another great example of how successful and lucrative a forward-thinking brand-agency collaboration can be.

By outsourcing branded content creation to Social Native, Crafted Communications helped Litehouse generate a 95% increase in sales during their product promotion.

In an interview with Camille Balfanz, Sr. Brand Manager at Litehouse, she said, By empowering micro-influencers to create authentic content, we were able to fuel our retail promotion with relatable, efficient, and insightful content that showcased our brand and product versatility across all our marketing channels.”

Litehouse User Generated Content Example

Content created for Litehouse

Quote@2x

By empowering micro-influencers to create authentic content, we were able to fuel out retail promotion with relatable, efficient, and insightful content that showcased our brand and product versatility across all of our marketing channels.

—Camille Balfanz, Sr. Brand Manager, Litehouse

Litehouse User Generated Content Example

Content created for Litehouse

Litehouse User Generated Content Example

Content created for Litehouse

Model Evolution



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