Brands Still Need Agencies for Social

Mike Mikho is the manager of business development at Big Fuel. Follow him on Twitter @mikemikho.

As someone who leads business development for a pure-play social media agency, I must disagree with Digiday’s “Brands Go It Alone in Social” article. While it may be true that many brands are taking day-to-day social media responsibilities in-house and using agencies mainly for creative executions, my qualm comes from the notion that it’s indicative of the natural maturation of social and that building an in-house team is a fraction of the price of retaining an agency. This is not so.

My experience at Big Fuel has shown me that more and more brands are looking for full-service social solutions from agencies, and the recent proliferation of social media shops is a direct response to demand.

Consider that the world’s largest brands trust their media buying, creative ideation, digital marketing and, often, PR to agencies. Of course, how the responsibilities are split between brand and agency vary by case, but in large part, companies have seen the value of letting experts do the heavy lifting. Also consider what an agency is actually charging. Brands are billed for working hours, so a fully allocated agency member who bills $100 an hour is costing a brand only $800 per day, not $2,400 per day as the aforementioned article suggests.

Now, consider the cost of replicating that value in-house. Staffing a full team means searching for, interviewing, negotiating salaries and providing benefits to team leads, strategists, analysts, community managers, content managers, tech developers, art directors and more. You also have to equip that team with the tools to succeed: a space to work, computers, printers, software and the wide range of tools that are necessary for social media research, management and analytics. Hiring an agency allows a brand to tap into best-in-class thinking and execution with almost no overhead, and they pay only for the work being done. Can those relationships get expensive? Hell yes they can, but they typically constitute only 2 percent to 5 percent of a brand’s overall marketing budget. The brands spending millions on social media are the ones spending hundreds of millions on everything else.

As you weigh the costs, bear in mind the return. When you hire a team that focuses solely on social, you don’t get traditional or digital thinking applied to social channels; you get truly social thinking. That means an understanding of how a social audience behaves and how to measurably drive business and marketing goals in a way that resonates with consumers — from major campaigns to daily posting. Can a brand accumulate that sort of talent in-house? Absolutely, but it’s not easy to find a team of people with extensive experience in strategic social thinking, unless you’re looking at a social media agency’s roster.

Many would argue that keeping day-to-day social media activity in-house means a more synergistic relationship with the rest of the in-house teams, as well as a faster communications stream. I can’t say that’s wrong, but if your agency doesn’t act as a seamless extension of your brand team that operates at a high level of speed and efficiency, you should fire them anyway. Any social media agency worth a major brand’s attention will be used to mixing quickly with others because of how often they have to interface with marketing, PR, crisis management and customer service groups. Furthermore, no group of people has more reason to develop a nimble company culture than a social media agency because of how quickly news escalates and deflates in the social space.

I’m not trying to argue that every brand should hire a social media agency. As with all things, agencies aren’t right for everyone. I simply believe that the natural development of social as a marketing medium means more demand for agencies, not less. I also believe that the cost/benefit ratio is typically favorable for brands, as we’ve seen with every other agency type. So I don’t anticipate my agency or my competitors will face any attrition — as long as consumers post, tweet, pin and like, we’ll be there to help brands get the most out of it.

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