New media channels and data raise agency profits

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Brands and direct and digital marketers get candid about the challenges and opportunities
Brands and direct and digital marketers get candid about the challenges and opportunities

Larry Franklin, chairman and CEO of Harte-Hanks, said in an earnings call in January that the company has been investing in contact centers and database businesses. These investments will continue in 2012, he said, as the company works to bring new products and services to the marketplace.

Agencies are expected to be more efficient. Acxiom president and CEO Scott Howe said in an earnings call in January that the company is focusing on improving its top management team. “We aspire to increase the speed and efficiency of everything we do, and to update the quality of the senior leadership,” he said. “One way to help the company achieve its goal of being more efficient is to focus on data services this year.” The firm is spending $30 million to build an “enterprise data platform,” which Howe says will help grow the business by expanding the company's leadership in the digital marketing space.

From C-level executives down to account teams and creatives, agencies are continuing to search for talented employees who are creative, understand data and are good with clients. “Talent is an ongoing issue,” Fetherstonhaugh says. “The challenge is finding people with deep quantitative and data skills, who thrive in a brand-oriented environment.”

Building and hiring talented employees is at the center of growing an agency to scale. This can be both a challenge and an opportunity. On the digital agency side, talent is also an issue. HUGE is attracting a lot of account wins, but Shapiro says that the company is careful to make sure that the quality of the work scales with the growth of the agency. “We won't sacrifice quality in order to grow, so finding the best talent in the industry in order to be able to keep on growing at our current rate is a big challenge,” he adds.

This year, direct and digital marketing agencies have the opportunity to attract big business and win clients by putting the building blocks in place to achieve long-term marketing goals. But the challenge is executing an effective program. “Everyone talks a good game, but what separates the winners from the losers is who can truly bring it to scale in a world-class manner,” Williams says.

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