How to achieve true integration: the impact of integrated marketing communication on the client/agency relationship

ABSTRACT

Reports from the advertising industry suggest that the pressure to create effective integrated campaigns across the ever-increasing mix of paid, owned and earned media is putting an enormous strain on client/agency relationships. This research identifies the main challenges that an Integrated Marketing Communication (IMC) approach places on this relationship and thereby advances the IMC literature by examining the practical challenges of implementation. Six key issues, developed from academic and industry sources, are presented to advertising experts, through a Delphi study, to stimulate debate and identify areas of agreement. The findings are brought together in a model which presents three main areas that need to be addressed, along with specific recommendations. These topics include the need for clients to provide stronger leadership in defining agency roles and responsibilities, more transparent remuneration systems to encourage teamwork across agencies as well as individual input and an increased emphasis on the strategic contribution from agencies.

KEYWORDS:

• Integrated marketing communication
• client/agency relationships
• integration
• remuneration
• advertising agencies
• media neutrality

Introduction

Integrated Marketing Communication (IMC) is based on the premises of consistency, collegiality and synergy. It requires people to work together, across the client organisation and across the various external stakeholders, so that all brand touch points are integrated, and the customer journey is smooth and effective. This need for collaboration can be seen as fundamental to the four key components of IMC as identified by Kliatchko and Schulz (2015): media neutrality, consumer centricity based on customer insight, co-ordination and consistency across the customer experience and the strategic involvement at board level. Bolman (2015) illustrates the complexity involved, in the Forbes leadership blog, by explaining that ‘the customer experience happens across an increasingly diverse set of brand interaction points throughout sales, marketing, services, engineering and potentially retail’.

This paper explores the pressures being placed on the client/agency relationship to achieve collaboration because industry reports suggest that this relationship is presently at an all-time low, evidenced by a lack of trust and communication. Understanding this relationship is essential as advertising agencies, of all shapes and sizes, play a major role in enabling clients to reap the benefits of IMC. A recent study by IBISWorld (2017) indicates that there are presently 16,212 advertising agencies in the UK, employing 110,100 people and producing revenue of £21bn. Their contribution to the economy is therefore significant and the difficulties that the industry is facing should be of concern to all marketers. Keller (2016) identified the challenges that clients face due to the ever-increasing choice of brand touch points and proposed that client/agency relationships needed to be explored further. Keegan, Rowley, and Tonge (2017) recently produced a comprehensive literature review of client/agency relationships with an emphasis on marketing-in-practice and identified a number of future research themes. First, they call for research that generates good practice knowledge and solutions to challenging issues. They also identify the need to reflect changing marketing communications where clients work with numerous agencies across digital, mobile, and social media platforms and to recognise the increasing role of trust in enabling the co-creation of marketing messages. This paper addresses these issues raised by Keegan et al. (2017) and moves our understanding forward by examining client/agency relationships through the IMC lens.

The paper firstly brings together both the academic and the practitioner literature on IMC and the impact it is having on client/agency relationships to establish the main issues facing the industry and thereby create six questions that need to be addressed. These are shared with a group of senior figures, many of whom having experience from both the client and the agency sides of the communications sector, through a Delphi process, to establish what needs to be done to meet these challenges and move IMC implementation forward.

Literature review

Integrated marketing communications

There is now acceptance by most academics and practitioners that IMC is the most effective process to adopt in the present complex multi-channel digital environment (Child, 2012; Keller, 2016) and there is growing evidence that IMC results in a strong positive impact on brand and financial performance (Luxton, Reid, & Mavondo, 2015; Porcu, Del Barrio-Garcia, & Kitchen, 2017). IMC has recently been described as in its mid-range level of maturity (Kerr & Patti, 2015). This position of agreement and development has emerged from numerous discussions and debates in the literature over the last 25 years on issues such as what IMC means (Luck & Moffatt, 2009), how integration can be achieved (Christensen, Firat, & Cornelissen, 2009; Christensen, Firat, & Trop, 2008; Kitchen, Kim, & Schultz, 2008) and how it can be measured (Schultz & Patti, 2009).

Kliatchko (2008) provided an overview of the development of research from 1990 to 2006 and proposed that discussions had moved on from definitions and justifications to more specific areas such as the relationship between IMC and Branding. He provided the following definition which was built upon this developing knowledge and is still referred to by many researchers in the area (e.g. Johansen & Andersen, 2012; Laurie & Mortimer, 2011; Munoz-Leiva, Porcu, & Del Barrio-Garcia, 2015; Ots & Nyilasy, 2015; Reinold & Tropp, 2012) ‘an audience-driven business process of strategically managing stakeholders, content, channels and results of brand communication programs’ (Kliatchko, 2008, p. 140). Kliatchko and Schulz (2015) provide a useful summary of the four key components of IMC: the use of multiple channels linked with media neutrality, consumer centricity based on extensive data driven customer insight, co-ordination and consistency across the customer experience and the involvement across all business departments at a strategic level. This acknowledgement of the need for IMC to be implemented at a strategic level of an organisation has led to a small but significant linguistic distinction in the literature from IMCs, with an ‘s’ which refers to the integration of different communication methods to IMC, which is a discipline or philosophy (Luck & Moffatt, 2009). Further emphasis of this strategic element has been provided by both Barker (2013) and Kerr and Patti (2015) who have proposed the new terms of Strategic Integrated Communications (SIC) and Strategic Integration (SI), respectively.

The acceptance of an IMC approach is also reflected in the practitioner literature in the UK. For example, Olenski (2012) argues strongly for clients and agencies to acknowledge the importance of IMC and the need for all touch points, both traditional and digital, to be co-ordinated and consistent. In a Forbes blog, a study by Dan (2013) reveals that ‘Integrated Marketing Communications has turned into the area of greatest importance for Chief Marketing Officers (CMOs), who desperately seek a holistic approach to engage consumers’. The study confirms that IMC is making the job of the CMO more complex in terms of control, accountability and measurement, often dealing with many agencies and channels.

IMC and the client/agency relationship

The importance of the client/agency relationship to achieve integration is acknowledged throughout the IMC academic and practitioner literature. Building relationships with external stakeholders, including agencies, is identified as essential at the second level of the Kitchen and Schultz (2000) four-level implementation model. Similarly, Duncan and Moriarity (1998) propose three main levels of implementation with again the acknowledgement of the important role of agencies (Laurie & Mortimer, 2011). Dan (2013) found that most CMOs considered assistance in achieving integration as the most important input they wanted from their agency.

Some of the issues that this relationship faces were identified by Gould, Grein, and Lerman (1999) who looked specifically at IMC and client/agency relationships. They proposed that for the relationship to achieve maximum integration it needed to go further than the traditional client/agency contractual agreement, as proposed by the agency theory, where the client was in control and specified the services required from the agency. It required a more inter-organisational approach where the relationship was seen as a business alliance based on trust and commitment. They proposed that a greater degree of integration would be achieved if there was a high level of collaboration and sharing of information as well as clients having fewer agencies and minimising agency turnover. However, more recent research by Mortimer and Laurie (2019) suggests that the opposite is happening, with agencies being increasingly used as suppliers instead of partners, and a clear shift of power and influence moving towards clients.

A higher level of collaboration and sharing of information would also lead to a stronger shared understanding of IMC. Ots and Nyilasy (2015) used the theory of mental models to identify how different stakeholders had a different perception of IMC and how it needs to be implemented. They found that there were four different models, each of which having a different emphasis on how IMC contributed to budget allocation, communication effectiveness and creative execution. These different mental models resulted in tension and friction between the different stakeholders, both across organisations and within them, and could result in lack of trust and transparency.

It can also be unclear whether it is the client or the agency who has the responsibility of initiating an integrated approach. The work of Kitchen et al. (2004) indicated that it was necessary for clients to encourage their agencies to work in an integrated way. An industry report of note published by the UK Institute of Practitioners in Advertising (IPA) and other industry bodies entitled ‘Magic and Logic’ (Baxter, 2006) concluded that both clients and agencies had joint responsibility to implement an integrated approach. However, Mortimer and Laurie (2017) confirmed that, because IMC needed to be implemented at a strategic level within the organisation, the responsibility sat with the client to take the initiative, although this was hampered by the fact that many clients found the concept difficult to understand.

The working relationship between the agencies themselves is also key for full integration to be achieved. A study by Ewing, De Bussy, and Caruana (2000) found that clients considered one of the main barriers to IMC implementation to be agency politics, as agencies of different disciplines had their own agendas and did not always operate in the best interests of their clients. Grant and McLeod (2007) identified the importance of numerous agencies working together and highlighted the importance of a shared purpose built on trust and personal chemistry in creating a strong network. This approach supports the idea that the relationship needs to be much more than just contractual (Gould et al., 1999).

The strength of the client/agency relationship depends on a certain extent on how clients manage their different agencies; whether they use a lead agency to oversee other agencies, organise them directly or move more work in-house. An IPA guide entitled ‘Agencies Working Better Together’ (2011) states that 80% of clients use either the All Agency model, i.e. organise collaboration of agencies themselves, or the Lead Agency model where one agency takes responsibility for integration across all the agencies. The study found that the All Agency model was popular with large organisations that had the manpower to adopt that role. A study on successful integrated campaigns by R3, a marketing consultancy, identified six different models of Integration and found that all structures could work as long as there was a strong big idea in the centre, roles and expectations were defined clearly from the start and that evaluation methods reflected contribution and accountability across the different agencies (R3, 2015). These results have been used by some to emphasise the importance of integration across all channels and to question the obsession with social media which exists in some parts of the industry (Ritson, 2015).

Whichever way clients are managing their agencies, there is evidence that the present system is not working and that the relationship between clients and agencies is presently at an all-time low with misunderstanding and frustration evident on both sides. Clarity of the problems facing the industry was provided by a comprehensive study by Hall and Partners entitled ‘From Mad Men to Sad Men’, commissioned by IPA (Thomas, 2015). Their results confirmed that agencies are feeling less valued and more like outsiders, being given more tactical work instead of contributing to strategic thinking at board level. Agencies acknowledge the drive towards collaboration with other agencies but find it difficult due to the client not creating the right atmosphere, with either too little or too much controlling from the lead agency. Clients have a different view and accuse agencies of having a narrow perspective and not understanding the bigger picture of customer engagement across numerous touch points. The clients also accuse the agencies of overstating their capabilities in order to get more work, instead of sticking to their specialisms. The Hall and Partners study concluded by identifying the need for clear accountability and fair payment structures.

More recent evidence from the advertising industry suggests that the situation is not improving. Ritson (2017) describes the agency landscape as suffering from a significant lack of trust which is leading to more creative and media-buying work going in-house. Although other colleagues paint a less dramatic picture (Hobbs, 2017), there does seem to be a general acceptance that the industry needs to urgently act to rebuild a supportive and collaborative environment.

This discussion has highlighted some of the strains that IMC has imposed on the client/agency relationship. The need for clarification in this area has led to the creation of our first research question.

Q1:

What role should clients take to enable collaboration and integration across their various communication agencies?

Another tenet of IMC which challenges existing agency relationships is media neutrality. Kliatchko (2008) recognised that for a truly media neutral planning model to be adopted, where creative ideas can come from any individual and any element of the mix can take the lead, it is necessary for agency compensation systems to move away from commission to alternative models such as fee-based arrangements to provide transparent performance measures and a clear reward for agency contribution. The customer journey has become more complicated with many clients using Paid media to encourage customers to visit their Owned space as well as stimulating Earned media activity (POE model) (Stephen & Galak, 2012), and the interplay between the different elements needs to be assessed with agencies from different disciplines working together to integrate messages and media (Green, 2011; Pessin & Weaver, 2014).

This need for collaboration and co-ordination between agencies has created problems in identifying a remuneration system which identifies individual agency contributions as well as teamwork and pays for them appropriately. There has been a gradual shift away from commission-based payment due to the array of agencies that are being employed and the drive towards media neutrality (Lace, 2000, 2003). These systems have been replaced by some element of performance related payment as well as fees based on time allocation. Lace (2003) argued that time-based payments are not necessarily the right approach to achieve media neutral planning because they recognise activity and time spent rather than providing a reward for ideas or creativity. It also encourages an agency to ask for more responsibility instead of working with other agencies which may have different specialisms. He suggested that a more holistic approach based on payment by results can measure performance at brand level, strategic thinking and working within teams, thereby encouraging more integration. A more recent study by Child (2012) indicated that this trend has continued with collaboration among multiple agencies increasingly being evaluated separately. The study found that up until 2009, less than 1% of agency evaluations measured ‘collaboration with other agencies’ as a discrete deliverable and this increased to over a quarter of evaluations examined in 2011. A WARC Best Practice paper (2018) described remuneration as ‘a long-standing tension’ and suggested that a shared performance-related fee may help to achieve integration.

In order to provide some clarity in this area, the following two questions have been put forward:

Q2:

How does the present agency remuneration system need to change to facilitate integration of communication?

Q3:

What demands does the combination of paid, owned and earned media have on the present agency structure?

The importance of building trust and respect between clients and agencies as they work on longer term strategic projects is identified as key. The ‘chemistry’ between agency and client staff is still seen as the most important consideration when clients are choosing agencies (Dan, 2013). Frequent changes of staff on both the client and agency side must, therefore, be considered a threat to a successful long-term relationship (Eagle & Kitchen, 2000). The Marketing Director of Homebase, a large DIY chain in the UK, stated that brands want a long-term relationship from their agencies because internal marketing staff move often (average every 18 months), and it is, therefore, important for the agency to provide consistency (Carlton, 2014). Consistency is even more difficult when agencies are under pressure to be flexible which has led to the majority of agencies investing more in freelance staff than permanent staff (Knox, 2015). A recent study revealed that 55% of agencies found that recruiting and retaining talented staff was more challenging than in the previous year (Harwood, 2017). The importance of long-term relationships is explored in the following question.

Q4:

How can the long-term orientation of integration ever work when there is a high mobility of staff across agencies and client organisations?

The acceptance that IMC is a strategic process which needs to be implemented at board level within an organisation is well established. Kliatchko and Schultz (2015) state that ‘IMC issues have become “C-suite” challenges’ (p. 2), a term used to refer to an organisation’s most senior executives. With the Chief Executive Officer’s (CEO) support, obstacles such as changing existing organisational structures and corporate cultural issues can be addressed. Porcu et al. (2017) also acknowledge the important role that senior management have in orchestrating vertical and horizontal alignment within the client organisation as well as with external stakeholders.

This support is crucial because many marketers feel that they are not performing a strategic role within their organisation and do not have the power to influence change (Chartered Institute of Marketing report, 2017). This is backed up by a study by Mortimer and Laurie (2017) which concluded that many marketing departments were suffering from both a low level of control and a low level of trust within their own organisations.

The growing emphasis on technical expertise to interpret and control the amount of data available is complicating matters further. Carlton (2014) suggested that agencies have a role to play here by providing justification and explanations in an appropriate format for boardroom members to assimilate and discuss quickly. They need to understand the client’s world better and look at the wider customer experience which is closely linked with technology and business transformation programmes (Thomas, 2015). The present trend of replacing CMOs with Chief Growth Officers (CGOs) with greater responsibility over the customer experience is a reflection of this trend (Campaign, 2018). Clarity in addressing this challenge is sought by forming the following question.

Q5:

How can true integration of communication be achieved when the marketing function has a diminishing influence at C- suite level in the client organisation?

Lastly, it was felt that in such a dynamic and complex environment it was important to identify the main issues facing client/agency relationships in the future as perceived by the participants and to ensure that all issues had been identified. Question 6 was, therefore, as follows:

Q6:

What do you see as the main challenges for client/agency relationships and structure in the future, as integration of communication becomes more essential?

Methodology

In order to explore these research questions, it was important to reach people with the appropriate knowledge and experience in the marketing communications industry. It was, therefore, decided to undertake a Delphi study. This method was initially created by the RAND Corporation for forecasting (Cuhls, 2003; Wakefield & Watson, 2014). Von der Gracht (2012) notes that during the past 60 years, the Delphi multi-round survey procedure has been widely and successfully used to aggregate expert opinions on future developments and incidents. In the marketing communications area, the Delphi method has been identified as a useful tool for undertaking research in public relations (Wakefield & Watson, 2014), advertising (Richards & Curran, 2002), social media communication (Dickinson-Delaporte & Kerr, 2014; Linke & Zerfass, 2012) and the future of IMC education (Kerr, 2009). Most recently, Kerr and Patti (2015) have undertaken a Delphi study to examine how SIC is a key element of IMC.

The main advantage of this approach is that it enables the researcher to gather the views of an expert panel, a group of people who are often in demanding jobs with little time to participate in research. Gläser and Laudel (2006, cited by Linke and Zerfass, 2012) define experts as persons with special knowledge about a certain matter and privileged access to that information. The Delphi technique enables these people to contribute to a discussion and debate anonymously and with equal status, in short spurts of time and without leaving their desks (Hsu & Sandford, 2007; Yousuf, 2007). Wakefield and Watson (2014) refer to it as a ‘virtual focus group’ (p. 579). The creation of the expert panel is obviously key to the success of the study. When selecting these respondents, the five basic criteria, put forward by Tersine and Riggs (1976), were followed: they needed to have a good knowledge of the subject, have proven experience in the area, be able to contribute in an objective and rational manner, have the time available to participate and be prepared to give up that time to take part fully.

The number of participants to be enrolled on a Delphi study can vary depending on the homogeneity of the group. Tersine and Riggs (1976) propose that between 10 and 15 participants should be sufficient for a homogeneous group and most studies seem to adopt this guideline (e.g. Kerr, 2009; Richards & Curran, 2002). Because of the expert knowledge required of the participants, their selection normally follows a purposive sampling approach, with suitable people being identified and directly contacted, although a snowballing approach is also considered appropriate (Wakefield & Watson, 2014). In this study, the researchers identified 48 people within their professional network who held senior positions in the communications industry and had the appropriate extensive experience and knowledge to contribute to the debate. A quota sampling approach was adopted to ensure contributions from both the client and the agency side of the industry and thereby present a balanced discussion, although it became evident that many of the participants had worked on both sides of the industry. Twenty-nine recruitment emails were sent out explaining the purpose of the study, the amount of commitment required and the expected timescale to minimise the amount of fall-out during the process, an important aspect of a Delphi study (Cuhls, 2003; Von der Gracht, 2012).

From the 29 invitations, 26 people agreed to take part, 17 respondents completed waves one and two of the study, and eight responded to the third wave. The LinkedIn data of the respondents demonstrates the following profile for the sample: seven CEO/‘Head of’/MDs, eight Global Directors and two Partners. All respondents have international experience and in addition, 15 self-report in their LinkedIn career profiles of experience working in both client and agency roles. The details of each respondent are provided in Table 1.

Table 1. Profile of respondents.

Type of organisation	Job title
Client – FMCG	Director Global Brand
Client – FMCG	International Marketing Director
Client – Toiletries	Global Brand Director
Client – Drinks	Global Senior Communications Manager
Client – hospitality	Head of Marketing
Client – not for profit	Head of Marketing and Corporate Comms
Industry trade association	CEO
Communication agency	CEO
Creative agency	Strategic Director
Creative agency: digital and direct	Managing Director
Digital marketing agency	CEO
PR agency	CEO
Media agency	Managing Director
Media agency	Global Client Services Director
Advertising agency	Head of Client Services
Agency	Business Partner
Agency	Planning Director

The Delphi process consists of a series of communications between the researcher and the participants, referred to by many as waves, with two waves being seen as the minimum and three waves the most effective (Wakefield & Watson, 2014). The aim of the first round is to explore diversity in responses, while the aim of the second round is to collect opinions and feelings into a more objective format (Wakefield and Watson, 2014).

The first wave can adopt an open-ended or more structured procedure. An open-ended approach is where a general subject is provided and participants then identify the main issues to be discussed. Rowe and Wright (1999) state that this approach is ‘ideal’, but conclude that ‘most commonly, Round One is structured in order to make the application of the procedure simpler…’ (p. 355) and this structure is normally built up from the literature (Cuhls, 2003). A more structured approach was adopted in the first wave of this study, to minimise the number of rounds and thereby decrease the dropout rate.

The first wave consisted of six open-ended questions (see Table 2) that were built up from the academic and practitioner literature, and communicated through the use of the Bristol Online Survey (BOS) system, with a link being sent out by email.

Table 2. Six questions sent out in Wave 1 communication.

1. What role should clients take to enable collaboration and integration across their various communication agencies?

2. How does the present agency remuneration system need to change to facilitate integration of communication?

3. What demands does the combination of paid, owned and earned media have on the present agency structure?

4. How can the long-term orientation of integration ever work when there is a high mobility of staff across agencies and client organisations?

5. How can true integration of communication be achieved when the marketing function has a diminishing influence at C level in the client organisation?

6. What do you see as the main challenges for client/agency relationships and structure in the future, as integration of communication becomes more essential?

Respondents were encouraged to provide their views and opinions on these questions and this feedback was analysed by two independent researchers to identify statements that best represented the variety of themes that emerged. These statements can be seen in Tables 3–8. The respondents were asked to read this list of statements for each question in Wave 2 and rank their level of agreement on a Likert scale ranging from strongly agree to strongly disagree. They also had the opportunity to comment. A linear scale was applied to the responses ranging from a minimum value of −2 for ‘Strongly Disagree’ to a maximum of +2 for ‘Strongly Agree’. These values were used to calculate a mean value for each statement allowing them to be ranked in order of ‘most agreed with’ statement. (Tersine & Riggs, 1976). This final ranked list was then sent out in Wave 3 for the participants to view and comment on further if they felt necessary. Standard deviation has been included in the result table to provide some insight into the spread of responses received for each statement and should not be considered as a measure of consensus (Schmidt, 1997).

Table 3. Question 1 statement.

Q1: What role should clients take to enable collaboration and integration across their various communication agencies?	Mean Ranking (−2 to +2)	Std Dev.
Clients need to take full responsibility for defining roles and responsibilities for all agencies involved.	1.65	0.59
The most important element of the client’s engagement is the quality of the brief; without a quality co-scripted brief, it never starts off on the right track.	1.53	0.7
Clients should ensure cross agency collaboration is a metric against which each agency’s success will be measured (and for which they would receive incentive).	1.12	0.68
Clients own the budget and with this responsibility comes the role of leadership in detailing the direction a brand wishes to pursue.	1.12	1.08
The client should be the one initiating integrated meetings/workshops where internal key stakeholders and relevant consultants/agencies sit around ‘the same table’, at least during the start-up phase.	1.00	1.03
Clients should take responsibility, as all too often clients just throw the ‘integration grenade’ and stand back to see what happens.	1.00	0.91
Clients should have dedicated experienced Product or Project owners, who know how to manage teams and are focused on delivery and not distracted by other priorities.	0.82	0.86
Clients should create an anonymous agency peer review system, where each agency reviews the collaboration skills of the others.	−0.29	1.23

Table 4. Question 2 statements.

Q2: How does the present agency remuneration system need to change to facilitate integration of communication?	Mean Ranking (−2 to +2)	Std Dev.
Final payment should be linked to tracked results against KPIs in the market.	0.65	0.97
The over reliance on procurement ‘specialist’ still remains a barrier to getting the best out of client/agency relationship.	0.65	1.23
There needs to be clear roles and responsibility for each channel and a separate fee for overall integration/coordination.	0.53	1.04
Increasingly Performance Related Pay – with maybe an element of a ‘group bonus’ across all agencies involved if overall objectives are achieved.	0.41	0.84
Fee structures should be based on Full-Time Equivalent + agreed o/head and profit margins as the base.	0.39	1.25
We don’t need to change remuneration system, it is about working processes and clear KPIs for each agency.	−0.10	1.14
The remuneration should be split: 50% on domain expertise 25% on joint campaign approach 25% on joint campaign success in market.	−0.11	1.05
The present agency remuneration system should move from being predominantly retainer based to become more project orientated so that all partners get paid directly from the client.	−0.35	1.23

Table 5. Question 3 statements.

Q3: What demands does the combination of paid, owned and earned media have on the present agency structure?	Mean Ranking (−2 to +2)	STD. Dev.
Good creative thinking is required regardless of media type if brands are to achieve their objectives.	1.65	0.48
It has little or no effect on a good integrated agency. The POE mix is just a question of channel. Great ideas and great content should be able to be blown out across channels.	1.18	1.04
As many agencies’ output will affect the media earned (content, PR, social, media, etc.) it is key that they all receive the accolades and compensation fairly.	1.17	0.6
It will require some more traditional agencies to upskill in certain areas of tech, social, data, search and PR – and this need to keep deepening skills will never stop in today’s world.	1.12	0.83
There needs to be clarity on who is allowed to do what to stop interagency combat for work.	1.00	1.08
This new ecosystem of POE is forcing agencies to reform around consumer impact and influence vs old measures like awareness and reach.	0.81	0.95
An agency cannot be best in all. So it forces towards a multi-agency set-up.	0.72	0.87
The emerging accountability and performance of messaging strategies are new KPIs for many agencies.	0.35	1.03
Understanding the inter-relationships and impact of POE touch points on one another is a difficult science.	0.29	1.23

Table 6. Question 4 statements.

Q4: How can the long-term orientation of integration ever work when there is a high mobility of staff across agencies and client organisations?	Mean Ranking (−2 to +2)	Std. Dev.
Ultimately it comes back to having clearly defined roles and responsibilities and agreed rules of engagement laid out that can be picked up and understood by anyone.	1.53	0.5
Integration can always work if the will is there from the top to make it happen.	1.29	0.82
The best relationships are inculcated into the culture and structure of both client and agency, and ultimately results speak for themselves – but it is a constant challenge.	1.18	0.92
Talent mobility is a reality that we need to embrace, agencies have to get better looking at talent retention programmes from professional but also lifestyle angle.	1.18	0.62
I think mobility can only be a good thing – too many client marketers have a limited breadth of experience.	0.65	0.97
Company cultures need to focus on the customer at all times, then any individual is not wholly responsible for integration.	0.15	1.08
Create a new award to recognise long-term orientation of integration in Cannes.	−0.06	0.97

Table 7. Question 5 statements.

Q5: How can true integration of communication be achieved when the marketing function has a diminishing influence at C level in the client organisation?	Mean Ranking (−2 to +2)	STD. Dev.
By offering strong strategic support and great understanding of the clients’ businesses, agencies can support the marketing people and regain the trust as partners at a higher level.	1.41	0.91
This is cyclical – as there is a return of confidence and growth the need for differentiation and customer focus will again increase – but it will be a shared responsibility across C-suite.	0.82	0.51
It is not diminishing as we are increasingly seeing marketing led CEO’s at the helm.	0.59	0.6
Integration at a communications level should not be too affected – it has more of an effect on the roll out of any broader brand idea across the business.	0.28	0.93
Marketers are now able to measure and analyse at an incredibly deep level thanks to the growth of digital comms, and agencies and marketers should use these insights and data to prove their value.	0.00	1.28

Table 8. Question 6 statement.

Q6: What do you see as the main challenges for client/agency relationships and structure in the future, as integration of communication becomes more essential?	Mean Ranking (−2 to +2)	STD. Dev.
Big challenges will lie in clients and agencies being nimble, and flexible, yet maintaining an appetite for risk and trial in the face of data and over-analysis. Risk and failure need to be accepted as part of building learning.	1.35	0.59
Agencies must adapt to support comms delivery at a greater range of touchpoints – not purely traditional marketing ones.	1.29	0.46
The main challenge is to Think ‘always on’. Stop thinking in campaigns.	1.00	0.94
The future is not only in integrated agencies, but in integrated teams. These will be multi agency, multi-client and multi specialists, where a team isn’t defined by the companies but by the talent.	0.94	1.03
For the agencies it is important to bring in young talents that are digital natives and passionate about new media, so that the offer can be broadened in a natural way.	0.94	0.54
An immediate change could be the expansion of procurement teams with true marketing services experience so fair and transparent negotiations can be had and sensible working structures put in place.	0.76	1.0
A belief that all of our agencies need to be integrated all of the time … is foolish – in that it makes no one agency accountable – and unproductive – in that agencies spend more time integrating than doing the work. The client should be more selective in terms of who does what and in which phase of the process.	0.65	1.13
It is necessary for clients to limit in-house solutions because they limit the ability to innovate and to achieve the highest level of creativity.	0.47	1.09
The main challenge is for clients to stop seeing integration as a means to cost saving.	0.41	1.09
As automated media buying takes hold, clients are looking for ways to pull that function in-house which will only challenge the integrated model again.	0.00	0.84

Findings

The findings for each of the six questions are presented in Tables 3–8 with the mean value of agreement and standard deviation for each statement. These tables are accompanied by a short discussion and overview for each question where emphasis is placed on the statements that have received the strongest agreement or disagreement and comments from participants if they assist in understanding the results. The wave and identity of participant is provided.

Q1.

What role should clients take to enable collaboration and integration across their various communication agencies?

The results, shown in Table 3, indicate a strong agreement that clients need to take a more prominent role in encouraging and assisting agencies to work together. There is clear recognition that it is the responsibility of the client to take the lead and to create the right structure and environment for collaboration and integration to take place across its agencies. One participant commented ‘…the key word for me in the statements is “responsibility”. Without it there is often uncertainty and a lack of clarity which is never a good way to go about business’ (Wave 3: agency). Another participant acknowledged that it is a challenging job and commented ‘clients need to take leadership role in cross agency collaboration – and that requires experienced competent client managers – and that is a skill that needs to be learnt/taught’ (Wave 2: client). One suggestion put forward to facilitate that was for the client to ensure that all roles and responsibilities were clearly defined right from the beginning. It was also felt important to bring the agencies together in meetings and workshops so that they can meet face to face in order to create a team mentality. Such team dynamics may also be encouraged by building in some type of metric to acknowledge and reward cross agency collaboration as well as have dedicated product and project owners who could focus on managing the agency teams. Although these proposals may sound sensible, it was identified by one participant as unrealistic; ‘Clients can also lead integrated processes but business reality is usually that they don’t have the overhead to do this’ (Wave 3: agency). Other comments suggest that some clients start off with these good intentions but they are not continued throughout the project. For example, one participant stated ‘Once assigned, clients often leave partners to “work it out” re scope which only leads to confusion and quickly leads to a silo approach. Healthy integrated partnerships are transparent, with clear swim lanes defined’ (Wave 1: agency).

The role of a clear co-scripted brief in providing clarity and direction was also supported strongly by the panel. This was justified by one participant by stating ‘They should get their agencies and suppliers working together on a campaign from the earliest stages of planning’ (Wave 1: agency). This can then lead to a buy-in and commitment from the agencies involved.

The idea of using an anonymous agency peer review system was less popular. One participant referred to it as ‘some mafia way of measuring behaviour’ (Wave 2: client). A respondent in Wave 3 commented ‘the final idea of anonymous agency peer review should probably be nearer to −2 as this is a very bad idea and would breed mistrust’ (Wave 3: client). Another stated that a peer review system could work if it was not anonymous and all views were out in the open (Wave 2: agency).

Q2

How does the present agency remuneration system need to change to facilitate integration of communication?

The results of this question are presented in Table 4. The lower mean rankings and higher standard deviations indicate that there were many different views on this topic. In fact, this question created the widest spread of responses. As one participant put it ‘I think the lack of strong feelings regarding the statements is revealing. We’d all like a better remuneration system but no-one can quite put their finger on what that might look like’ (Wave 3: agency). Another participant illustrated the challenge by questioning how an agency should be paid when they have done good executional work which has failed due to the poor creative idea that was provided to them from the lead agency. He concluded that ‘this can get quite complicated unless managed quite tightly’ (Wave 3: agency). There was also some agreement that flexibility was needed and a ‘one-fix-all’ may not be appropriate. As one respondent put it ‘It made me realise that remuneration models need to be considered case by case’ (Wave 2: agency) and ‘How the client wants to work is the biggest influence over the model that will best work for them and the agency’ (Wave 2: agency). An attempt by one participant to suggest a particular formula for dividing remuneration into three sections was not popular. The proposal to move away from retainers also received little support.

Two statements attracted higher levels of agreement and were further qualified in the Wave 3 responses. The first was the need for payment to be linked to KPIs with some acknowledgement of overall integration, perhaps in the form of a group bonus, as well as individual agency contributions linked to achievement of overall objectives. ‘Final payment can be linked to KPI’s but you need to establish up front the payment structure. Is an agency held responsible for their thinking or their execution? Or both?’ (Wave 3: agency). This statement links back to Question 1 in identifying the need for clarity at the beginning so that agencies know what work they have been assigned to do and what they are being paid for.

The second statement related to specialist procurement agencies and their role. There was concern about the increasing role of procurement specialism which was considered by some as an obstruction to creating a good relationship. One participant stated ‘The procurement specialist has a lot of use. It separates content from money. However, the specialist should be truly knowledgeable’ (Wave 3: client).

Q3.

What demands does the combination of paid, owned and earned media have on the present agency structure?

This question created a lot of different views and opinions, which is reflected in the list of statements that was created, as shown in Table 5. It is an issue which seems to be at the core of agency collaboration and which is creating many of the challenges facing the industry and its present structure. The panel felt strongly that creativity is at the heart of any campaign or project and that a good creative idea should be flexible enough to be ‘blown out’ across these different channels. As one participant put it ‘a great idea is only great if it can stretch across multiple channels’ (Wave 3: agency). Although this may be reasonably straightforward if the work is being done in one integrated agency, if it is spread across numerous agencies there is a need to establish exactly who is responsible for what and to identify what impact various elements have had on measurable outputs such as earned media with acknowledgement for all contributions. This lack of clarity in terms of responsibility can lead to agencies fighting for a larger share of the work, despite it being outside of their specialist area which is obviously of concern to specialist agencies, leading to conflict rather than collaboration. Again, the issue links back to the identification of clear roles and responsibilities as discussed in Question 1.

Understanding the relationships between these channels and how they should be measured is still perceived by some of our participants as difficult. One participant stated that there were ‘too many fluffy measures used around consumer impact without a real science’ (Wave 2).

Q4.

How can the long-term orientation of integration ever work when there is a high mobility of staff across agencies and client organisations?

Table 6 indicates that mobility of staff is an ongoing topic for discussion. As one participant put it ‘it is something that we have had to accept and adapt to as best we can’ (Wave 2: agency). The panel strongly agreed that it is important to have defined roles and responsibilities so that there are clear expectations and new staff can pick up from their predecessor easily. There is also a recognition that strategic integration has to come from the top of the organisation and that the support and leadership of top management is key in ensuring that an integrative approach continues despite personnel changes and this should be reflected in the customer-focused culture of both the client and agency organisations. It was generally agreed that agencies should do more to keep their best staff although some participants felt that mobility of staff was a positive phenomenon. One participant stated that lack of mobility ‘stops the supply of oxygen to organisations which in turn leads to stagnation long term’ (Wave 2: agency). The idea of creating a new award at the annual Cannes Lions Festival of Creativity for long-term orientation did not create strong feelings in either direction.

Q5.

How can true integration of communication be achieved when the marketing function has a diminishing influence at C level in the client organisation?

This question seemed less controversial than others, resulting in a smaller number of statements being required to summarise opinion, as shown in Table 7. There was a strong agreement that it is a responsibility of agencies to provide their marketing counterparts with strategic support so that they can establish more influence at C-suite level within their organisation and a recognition that this is where marketing decisions are going to be made in the future. One of the participants stated that ‘It is down to agencies to connect well with individuals of influence within their client’s business’ (Wave 3: agency). Another respondent suggested that ‘Marketing departments need to start marketing themselves a little more internally’ (Wave 3: agency). One participant considered the challenge of being heard at C-suite level to be a joint one stating ‘This is a task of the agencies and the marketing team to prove to the C-suite the importance of communications. Like every department, your presence at the top table should be earned rather than given.’ (Wave 2: agency). Against this backdrop, there is also some agreement that there is an increase in marketing-led CEOs and a growing appreciation of Marketing at the C-suite level. As one participant put it ‘I think the supposition underestimates the knowledge/understanding of current C-suite. They are much more customer focused than ever in increasingly competitive markets’ (Wave 2: client).

Q6.

What do you see as the main challenges for client/agency relationships and structure in the future, as integration of communication becomes more essential?

This question identified a number of different future challenges with reference to the present client/agency structure that are clearly from the agency and client perspective, as shown in Table 8. First, it is predicted that agencies will need to be more flexible and able to respond quickly to the needs of clients and yet still be courageous and try out new ideas. This flexibility may come from the formation of integrated teams where people are recognised by their talent rather than their allegiance to an organisation. There was some agreement that not all agencies have to be integrated because it can be a distraction and clients need to make decisions and allocate work clearly. Other issues identified are the present use of procurement teams and the need for them to have more marketing services experience and the need to continually attract new talent to the industry, particularly with digital knowledge, so that all touch points can be explored. One participant felt strongly about procurement and suggested ‘at all costs keep procurement people out – no marketer with a passion will want to become a procurement specialist’ (Wave 2: client).

Discussion and implications

This study presents a unique window into the world of experienced marketers, on the client and agency side of this global and dynamic industry, and provides an insight into ‘marketing-as-practice’ in terms of what they identify as the main issues facing the client/agency relationship when adopting an IMC approach to communications and how they need to be addressed. These challenges have been created to some extent by the need to obtain media neutrality across the ever-expanding media options, including paid, owned and earned media (Kliatchko & Schulz, 2015). A recent study by Robinson (2017) illustrates how young people are continually media multi-tasking and therefore campaigns must communicate a cohesive narrative across the different media. For this to be achieved, a higher level of co-operation and collaboration is needed across all the different agencies, e.g. full service, digital, creative, PR, direct marketing and media. Perhaps not surprisingly, the overall issue is getting people from different companies with different agendas and cultures to work together as a team to reach an agreed goal, people who are often more familiar with competing for business than for collaborating with each other.

An analysis of the findings has led to the identification of three main themes with recommendations for creating the right client/agency relationships for IMC implementation, as shown in Figure 1. These recommendations, with one exception of note, are based on the IMC philosophy of collaboration and cooperation and are thereby proposed to be the responsibility of both clients and agencies.

Figure 1. Three main challenges of client/agency relationship for IMC.

One of the strongest findings from this study is that clients have a duty to identify the roles and responsibilities of all parties as early as possible and facilitate a strong team spirit between themselves and their various agencies to minimise in-fighting and create trust and collaboration. Suggestions to achieve this include the need for ongoing strong management by the client of the project to facilitate team work, e.g. face-to-face meetings between agencies and frequent informal communication. Another recommendation is for the brief to be co-created. This idea of the agency shaping the relationship with the client is recognised by Beverland, Farrelly, and Woodhatch (2007) who examined pro-activity in the client/agency relationship and found that clients like their agencies to be pro-active in terms of coming up with new ideas, particularly from a strategic perspective. This may be suggesting solutions that are over budget or a little unexpected. Clients welcome that initiative and it can provide agencies with a source of differentiation.

This team approach links in with the agency theory which proposes that for full integration between a client and an agency to be achieved the relationship needs to be more of a business alliance than a traditional client/agency contractual agreement (Gould et al., 1999). More recent work into client/agency relationships and co-creation support the importance of collaboration. Hughes, Vafeas, and Hilton (2018) recently examined resource integration between clients and agencies at the different stages of the creative process. The study indicates that the creation of the brief is sometimes a joint co-creation between both parties and such activity leads to increasing trust and buy-in. The framework Hughes et al. (2018) produces may be useful in identifying the resources that the different parties are expected to provide at different stages of the project.

However, not all clients are the same. Diaz-Mendez and Saren (2018) also took a Service-Dominant logic approach to the client/agency relationship and examined how the characteristics of the client can affect the actor-to-actor collaboration. They identified four types of clients that can vary in levels of knowledge and collaboration and propose that it is the clients who have a high degree of knowledge and a positive attitude towards collaboration that will maximise the value co-creation with their advertising agencies and create the level of trust needed for such a relationship. This work supports our findings that all client/agency relationships are different and any proposed guidelines need to build in flexibility and not propose a one-fits-all approach.

A strong collaborative relationship between the client and agency would seem to be the ideal scenario for the implementation of IMC (Levin & Lobo, 2011). However, it may be unrealistic when applied to the common multiple agency structure, as numerous agencies require a greater degree of clarity in terms of job roles and responsibilities, placing increasing emphasis on the role of the project manager. A study by Caplin (2016) identified that clients in the major markets had an average of 24 agencies working for them, and it is predicted that these numbers will increase, making the leadership role challenging for clients. The R3 report (2015) stated that this role requires the use of both hard and soft skills, e.g. diplomacy as well as strong decision-making, so that roles and responsibilities are defined, and conflict and infighting are reduced. This clear allocation of tasks is also essential to minimise disruption caused by staff mobility and to assist in fair payment of services.

The identification of roles and responsibilities is closely linked to the remuneration issue. The need for collaboration and cooperation between the agencies has increased as a result of the escalation in the number of media channels available and the way in which paid, owned and earned media interact with each other. For collaboration across the agencies to work successfully, it is essential to have a remuneration structure which establishes clear transparent, accountability and relevant performance and payment systems at the beginning of the project. Such a structure needs to recognise and reward three activities: individual agency contributions, cross agency collaboration and the overall success of a project. Our results indicate that there is a lack of consensus on the best way of achieving this, but there is strong support for some type of shared performance related fee alongside the KPIs to encourage collaboration. This may be achieved in some way by the identification of the operant resources being supplied by each actor at the various stages of the process, as put forward by Hughes et al. (2018). The remuneration system is fundamental to the success of running effective IMC projects and therefore deserves more attention both from the industry and from academia.

Our panel identified that creativity is still the central force of the relationship, and agencies must ensure that they provide the big ideas that ignite these long-running projects. However, an important characteristic of IMC is its strategic focus (Kliatchko & Schulz, 2015), and there needs to be an IMC culture coming down from the top of both client and agency organisations to maintain this focus and ensure that creativity is not just at the communications level but at the corporate level, with strategic ideas that will have an influence across how the client organisation goes about its business and how the customer experiences that company and that brand (Kerr & Patti, 2015; Thomas, 2015). Such an approach will keep the agencies involved in the boardroom discussions (Dan, 2013). Clients now have access to considerable behavioural data that has not previously been available so they are in a stronger position to make informed decisions, which means that agencies need to clearly identify what their contribution is. Beverland et al. (2007) endorse the importance of ‘strategic reflection’. These findings also support those of the Forrester Report (2010) which suggested that the future role of agencies will be providing ‘ideas, interaction and intelligence’.

Conclusions, limitations and future research

The purpose of this study is twofold. First, it is to bring together academic and practitioner literature and identify the main challenges presently facing the client/agency relationship through the lens of IMC. Secondly, its contribution is to capture the views of highly experienced marketers from both sides of the industry and, through idea generation and debate, identify some recommendations to address these challenges. This is important because IMC is recognised as having a strong and positive impact on brand and financial performance. The application of the agency theory and our knowledge of co-creation reinforce the fact that working together creates synergy and added value. However, the advertising industry is struggling to create the right collaborative and supportive structure that is needed to enable an integrated approach to be fully adopted. There is a breakdown of understanding and empathy which is leading to a lack of trust on both sides. This is mainly due to the expansion of brand touch points which have created complex communications projects that involve numerous agencies with various parts to play. This breakdown has led to more work going in house and to the role of agencies being examined.

This study has brought together the views of experienced clients and agencies to provide some recommendations to these challenges. The findings identify a dilemma within the industry in that, on the one hand, there are calls for flexibility and adaptability and, on the other hand, there is a requirement for clear rules and procedures. Although it must be acknowledged that every client/agency relationship is different, and therefore flexibility is important, agreement has been reached over some key proposals to address the obstacles being faced and these have been summarised under three main headings: Relationship Management, Media Neutrality & Remuneration and Strategic Focus.

There are some limitations of the study that need to be recognised. The Delphi approach is considered the best tool to bring together time-poor executives and it was successful in generating a discussion of this complex topic and obtaining a broad level of agreement among experts around the six identified topic areas. Because the study was designed around three waves to minimise dropout rates, it was not feasible to measure levels of consensus. Indeed, the lower number of comments received in Wave 3 confirmed our concerns in this regard. To address this, it is planned to conduct some qualitative interviews to explore some of these issues further. This study has also brought together the views of both agencies and clients rather than make a comparison between them. This approach was undertaken for two reasons. First, the number of participants, as is often the case for such studies, was relatively small and therefore it was felt inappropriate to make comparisons. Secondly, it was found that many of the participants had worked on both the agency and client sides of the organisation, and therefore it could not be assumed that their views necessarily belonged to either group. However, it would be interesting, perhaps in a larger quantitative study, to compare the views of the agencies and clients to identify areas of conflict and agreement.

Other areas for future research have also been identified. Although remuneration is seen as a key sticking point in terms of encouraging collaboration and trust between partners, there is very little academic research undertaken in this area which needs to be addressed. Some case studies on successful client/agency relationships that created strong integrated work would also be useful. A recent article by the Vice-President of Marketing for Lufthansa stated that their latest successful campaign was achieved due to ‘the long-term relationships the airline fostered with its agencies, based on trust, openness and understanding each other’s motivations’ (Rogers, 2018). He describes how they worked together on the brief with a clear common vision, despite there being a number of agencies involved. A close examination of this type of successful relationship in terms of allocation of responsibilities, communication, remuneration, etc. would provide some clear and practical guidelines for organisations to follow. Trust has been identified as a necessary ingredient for these relationships to work, but it seems hard to achieve if some of the basics such as transparency and clarity of purpose are not evident from the beginning. Some progress is already taking place in the practitioner literature on creating strong case studies, but they are sparse in the academic discussions.

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Notes on contributors

Sally Laurie

Sally Laurie is Marketing and Entrepreneurship Deputy Subject Leader and Course Leader for BA Fashion Marketing at the University of Northampton, UK. Her particular research interests are in professional practice within the communication industries and the management of integrated marketing communications, and she has published in both practitioner and academic journals including the Journal of Marketing Management and European Journal of Marketing. Sally is a University of Northampton fellow in learning and teaching and has a prevailing interest in the embedding of transferable skills and employability skills within undergraduate education.

Kathleen Mortimer

Kathleen Mortimer is an Associate Professor in Marketing Communications at the University of Northampton, UK. Her research area is in advertising and consumer behaviour. More specifically, she has written in the area of services advertising, integrated marketing communications and advertising regulation. Her work has been published in numerous scholarly journals including Journal of Services Marketing, European Journal of Marketing and Journal of Marketing Management. Kathleen is a former Deputy Editor of the Journal of Marketing Communications and the Chair of the Marketing Communications SIG for the Academy of Marketing.