In this episode of the podcast, editors Marc Iskowitz and Larry Dobrow take listeners behind the scenes to share trends, anecdotes and observations from assembling this year’s Agency 100 issue, the annual bellwether which made its 2019 debut earlier this week. Below is an edited transcript.
Marc Iskowitz: So first, Larry, why don’t you set the stage for people just in terms of all the orchestration that goes into the Agency 100 issue. There is a process to it that people are often curious about but may not be aware of.
Larry Dobrow: It starts in earnest around January, when we sit down and sketch out deadlines, the general idea of what we want to do, how it might be differ from years past, content that should be subtracted, content that should be added. The two of us and our production editor, Kevin Zitzman, sat down probably the first week of January and sketched out the big-picture plan.
After that, it was a matter of reaching out to all the companies that we featured last year but also ones that had expressed interest in [being featured] and saying, “Hey, let’s get your contact information.” And you’d think that’d be a pretty simple, straight-forward step. But then you get about 85 bounce-back emails because—and that’s one of the trends that we’ll talk about later—you know, there’s a lot of movement. People are very much in high demand, people are coming, people are going.
So we launched the Agency A-Z Survey in mid-February, and that’s how we compile the information that goes into the choice of the top 100 firms, the “Ones to Watch” and everything around it. Then the momentum picks up. You start working on the thing and, next thing you know, text is coming in. We worked with maybe 10 freelancers, in addition to everybody on staff.
Iskowitz: It’s a group effort.
Dobrow: And when it finally comes together, it’s kind of a cool thing because what’s the average issue of MM&M? 55 pages? 50 pages? This one checked in at 244, and the idea that a print product can be so anticipated and successful in this day and age, I think is pretty cool and pretty rare. And, I think, it speaks to the vibrancy of the agency business.
Iskowitz: [Editor in chief] Steve Madden was plunking it down on tables earlier today, listening to that satisfying sound that only comes with a piece of print that size.
Dobrow: I don’t think anyone would’ve been really happy unless we could plunk it down on somebody’s foot and hear a bone shattering, but we did okay.
Iskowitz: And since we added the revenue table a few years ago, it’s kind of taken on a financial feel, more of a numbers feel, in line with the trend around data.
Dobrow: It’s funny you bring up the revenue table. The two of us have been working on this issue since we started the revenue table in 2015. Before, we had a list of 100 agencies. They were beautifully written profiles, they were deeply reported and they were—most importantly—independent. But there wasn’t that kind of unifying element, and I think having that listing where—listen, I’m not sure if all of our estimates are 100% in line, but we know that they’re pretty [darn] close, because we always hear from people after the fact saying, “What’s your secret formula?”, which of course we will not be revealing here—but having that one unifying piece of content, to me, took this thing to a different level. And I know that this is something that you really pushed for and that you shepherded all the way through.
Iskowitz: Thank you. It was something that I felt distinguished us amongst our competitive set. The agencies, at the time, [would refuse to share revenue, citing] Sarbanes Oxley. And if you’re going to hide behind a piece of regulation, make it legitimate. I thought that we needed to peel back the onion there and the agencies, to their credit, went along with it—and to your credit, because you’re really on the front lines…helping to facilitate that.
Dobrow: You know, you never want to feel like a bully by saying, “Give us this information, or else!” Ultimatums are stupid; they don’t serve anybody. But at the same time, there were a bunch of companies that weren’t used to being asked anything other than, “So, how was your year?”
A couple of years ago, when we made that question mandatory, we gave everybody an out. Of course, there’s always ways to game an online survey, right? You could stick a zero in where the number should be. But I think that at first it was viewed with some suspicion. Once everybody else saw the end result and that they could put themselves up against the competition—where they were in terms of tiers (there are a bunch of agencies that hit around $20 million and then there’s a little bit of a jump and then there’s another jump around $45-$50 million)—I think that became really one of our selling points with this thing.
Iskowitz: And I thought it was important to include that, but you really made it happen; so kudos to you. And I should qualify my earlier remark by stating that I’m sure there was some legitimate hesitancy in terms of revealing some of that data. Because when you put data out there, especially financial, you have to stand behind it. But those kinds of fears and concerns melted away and gave way to the greater good. Most believed in the necessity of this as a journalistic product, that it was necessary to get that [info] out there.
Dobrow: And again, the Sarbanes Oxley regulation was not an illegitimate excuse, but there was a big distinction between “Here’s the information that we absolutely cannot give” versus “Here’s the information that we don’t want to give.” And I think it always skewed toward the latter.
Iskowitz: Well said. So, speaking about an opening up amongst the agencies, they have also opened up about a lot of trends that they were seeing. What kinds of things jumped out to you in terms of trends across the agency sector?
Dobrow: We always joke about there being kind of a fallback [trend] among agencies in a given year. When I first started writing for this issue [several] years ago as a freelancer, it was, “Well you know, we’re becoming more digital, the business is becoming more digital.” And you heard that about 30 times over the course of however many interviews you did and you started almost making fun of it, right?
That said, I am not making fun of this, but this year’s big trend was AI, it was data. “We are hiring data scientists and we are not finding enough people that have skills there. We are crunching numbers, we are doing things that we never imagined we could do to such great ends for a client.”
The small frustration with that is that case studies are still in relatively light supply, because I think, in many cases, a lot of the things that are being done are pretty deep. They’re very different from what we’ve seen even 18 months ago. So if you’re one of the agencies that does this really well — If you’re W2O, if you’re Wunderman — I’m pretty sure you don’t necessarily want to share your secrets with the universe. Those are the secrets, of course, that we want to write about and share — just for somebody like me, who is genuinely curious in what’s going on and how healthcare marketing is evolving. So we thank those two companies and a couple of the others that were so open about sharing.
Iskowitz: Yeah, if [only] I could be a fly on the wall at those agencies that are able to share case studies versus those that aren’t. But you mentioned W2O, and they did share some nice case studies, in terms of how they’re using analytics in the service of clients and how it really informs their creative; that was really interesting to me, as well.
Tech-forward initiatives — I noticed a lot of agencies proffered those in their talking points, like voice tech, EHRs, mixed reality and AI, even in the service of med ed. You know a technology has crossed over when you see it popping up in med ed, which has always been one of the more conservative branches of marketing.
Dobrow: It’s not about textbooks any more, Marc!
Iskowitz: That’s right, or didactic lectures. Also media — I can’t recall another year when so many agencies said they’re bringing on media capabilities. Because it matters so much how the messaging plays out across channels.
Dobrow: One thing I found — and I’m glad you brought that up; it was probably the next thing I would’ve mentioned. But [in terms of] media, at this point if it’s not inseparable from everything else you’re doing, it should be. I think there was always this kind of reluctance, but “okay, we have to cede some control to media-specific experts”.
To be fair, there are many, many media-only firms that do incredible work. Publicis Health Media is a wonderful firm, as is CMI/Compas. But if you’re one of these mid-to-large-sized agencies, this is the kind of thing where you have to have some idea [of the media strategy] when you’re formulating the work. You can’t just have a “Here’s an asset, let’s shape it and mold it for the digital world” attitude. It doesn’t work like that anymore, so I think agencies have been very nimble in the way they have sought to add that capability.
Iskowitz: And some of the firms that had those media capabilities in-house were Partners + Napier and Merkle.
And another thing I had noticed was agencies stating that they’re looking for clients that want to take a risk. We’ve talked about for years about how healthcare marketing is just waiting to break out of the box and push the envelope in terms of creativity. And if you’re an agency executive, you can sit there and stew in your own frustration about clients that put the handcuffs on, or you can do something about it.
And this year I noticed that there some agencies actually seemed to be changing their position, almost, to say, “We’re only going to go after clients that are willing to take this risk with us,” and, likewise, looking for employees who want to work on risky kinds of work.
When I say “risky,” I don’t mean playing golf in a lightning storm or something. Of course, I’m talking about stuff that pushes the regulatory envelope, and healthcare marketing is not for the faint of heart. It’s more of a rollercoaster ride than some of the other branches of advertising that aren’t regulated. But I saw H4B Chelsea mention this, Rapp Well mention this, going after this different type of client that is willing to be more brave.
Dobrow: I think one of the things that sometimes gets lost in these conversations is that what these companies do, what these agencies do, it’s hard. It’s basically doing something that is hard to do, which is to get somebody’s attention and capture someone’s imagination in an era where there’s no shortage of things that will capture the imagination. It’s all at your fingertips in any given moment. But you have to do that in a context where there’s incredible regulation, [and] where you could be developing a [pipeline] asset and then a regulatory body says, “No, that asset’s not going to make it [to approval].”
There are so many obstacles, so when you look at — I think the way you were phrasing it when we were talking just before was “agencies that want to be a little brave.” I think that’s it. There used to be this kind of mentality where “Okay, let’s be the second person to do something. Somebody else has to be the bold one and then we’ll be right behind them, we’ll knock down the door after they’ve already opened it.”
But now you find, especially with some of the A-list creative shops, they’re saying, “You want to work with us? Here’s what we would like to do. Let’s do this together, let’s figure this out together.” I sense there are still some clients that are still very reluctant. You hear about — not to name names or anything — but you hear about certain clients who want to do something up until the moment they don’t want to do something, which I can only imagine is so incredibly frustrating for a company.
That said, if you’re working with an H4B Chelsea, an Area 23, a Hill Holliday Health, a Havas Tonic, these are agencies that have almost expectations of their clients. Like, “You want to work with us? We’re going to try to do interesting and new and different stuff together. Let’s break some molds.”
Iskowitz: Absolutely. [Along the same lines,] we’ve heard so much about the shift from volume to value in the greater healthcare universe. Agencies seem to be kind of picking up on that, in their own way, in terms of fighting against the commoditization of agency services. I heard the idea of value-based pricing for agency services. Not sure exactly how they would tie those services to value. It’d be tricky in terms of how you measure value. But, Saatchi and Saatchi was one of the ones that mentioned that, providing value in the face of cheap competitors through thought leadership and certain specialized expertise. Healthcare Success mentioned it, too, as did Intouch Solutions. And you always see, in the challenges section of the A-Z survey, shrinking marketing budgets as a top concern, so I have to think that this is a response to that.
Dobrow: It’s a little bit of a pushback. In a way, what we were saying before about bravery kind of fits in here, as well. Agencies, and with very good reason, the best companies, the best agencies have confidence, and they’re saying, “Listen, you don’t buy it right at first? Let’s figure out some kind of a model where we would be rewarded quite well if it works out in the way that everybody wants it to.”
That can only be a good thing. Nobody wants…marketing is not for the meek, doesn’t matter what kind of marketing. It can be a local car retailer ad, 46 minutes after the hour, on the little local break on any network. But you know, I applaud the agencies for having that confidence. I’m not really sure that’s something that traditionally has been there.
Iskowitz: I don’t think so, either, and you have to take your hat off to them, too, because they’re raising all boats when they do things like that, when they make statements like that. We know who the real standout creative agencies are; they seem to be leading the charge here, and I’m noticing other agencies taking more chances. Some of the work that we’re seeing doesn’t look categorical, it doesn’t look like typical pharma work, and I think that’s a good thing for all parties.
Dobrow: Absolutely, and what’s great about that is that it’s across all channels and all genres of marketing. You’re seeing better traditional DTC work; you’re seeing much, much, much better digital work. In every realm, people are pushing it. You’re seeing social media, [where] everybody said, “Okay, we’re not getting the complete set of guidelines that we want that outlines specifically every single thing that we can or can’t do? [Forget] it, let’s do something until someone says we can’t…”
Iskowitz: “…Because we have to be there [on social], because the eyeballs are there. We’re going to work with med-legal and figure this thing out.” And kind of the ultimate expression of that new attitude would be pulling back on certain clients that aren’t willing to go there. And I saw that, too. I saw some agencies saying, “We parted ways with this client or that client.” Sometimes the client was unreasonable, but perhaps some of it was that the client wasn’t able to approve some of the work that [they] were putting forth.
Dobrow: In the profiles, there was a lot of, “You mentioned that you’re no longer working with three clients. Why?” And that’s one of the few times that I went, “Can we go off the record?” and most of the time it was exactly that frustration. “We were busting our heads, we were presenting 72 different things and we got an ‘Eh, I don’t know; maybe?’” And I think fortunately in this new, I would say emboldened atmosphere, agencies can do that. They can say, “You know, we don’t want to work with someone who is going to take the 72 million hours of our brain power and just say, ‘I don’t know, next year.’” Again, that’s a great trend, I really hope that’s the kind of thing that, when you read the entirety of the profiles, that pops out.
Iskowitz: There’s a lot more swagger to this sector now, which is something that we haven’t necessarily seen in the past. So speaking of that, let’s talk about sort of anecdotes, interesting stories and/or up-and-coming agencies that you want to call out. Do you want to start off this segment, too?
Dobrow: Let’s see… You know, it’s funny because, again [with] a lot of this is, you’re [interviewing] somebody working as an agency’s primary mouthpiece, whether formally in a CEO or president role or a director of marketing role. I think a lot of it is how well you tell your story, which is what everyone does; we’re telling our stories and everything else. So I am almost hesitant to say, “Well, if you’re not on this list, you did a lousy job at telling your story. Come back with someone more charismatic next year,” because that’s not the case at all.
With that said, of the people I spoke with I am continually impressed with Area 23, not just from the product that they put out, but with the way that Tim and Renee lead the agency. They’ve really said, “Hey, we work hard here.” I also hear [that from] a lot of people. At the end of each of my calls, I said, “Okay, this is just for my own reporting; it won’t be in the story. [But] who are you looking at right now? Who do you like? Whose people are you trying to get? Where do you want to work if you were working somewhere else?” And Area 23 was cited by a good 30-35% of the people I asked that question to, and that’s pretty unprecedented.
H4B Chelsea has always had a good reputation and they had another really strong year, good leadership, good work. Harrison and Star I think had an excellent year. In the last couple of years, there was sort of this idea that maybe a lot of other people caught up with them in the rare disease realm and maybe they weren’t the only company you’d go to for something like this. Maybe there were a couple of others, but I think they’ve had a really, really good last 18-24 months.
Among smaller agencies, Brick City Greenhouse is doing terrific terrific work. The way they describe it is funny, too, because they say, “We were operating out of a WeWork facility, and then we decided that we didn’t need that facility, [because] every one of our chats is being done via FaceTime.” You know, just based on this, I work [remotely] a lot of the time and there can be this sense of dislocation, almost. They manage, [despite having] people scattered and working from a bunch of different locations, to put out some tremendous work. I think they’re one of the — even though they were [already] in the Top 100 this year — I think that’s one agency you’ll see making a lot of gains over the next year or so.
In the digital realm, Arteric’s doing some terrific work. Hans Kaspersetz, who is their leader, basically he said, “We are software developers who decided to crush it in healthcare marketing,” and I think that coming from that perspective is giving them a big lead in the digital realm. I think Motionstrand is doing some excellent work among those lines.
In the payer world, I think Precision for Value and the larger Precision Value & Health group are doing wonderful work. I’m forgetting so many people, but I think that the idea that there are — if you say, “Hey, who’s doing good?” and I can get to like 50-60 companies without taking a breath, that’s probably a good sign. How about you? Who are you looking at as some of the leaders, movers, shakers? Who impressed you the most in your reporting? You were the poor sap that had to read all of my stuff.
Iskowitz: It was an impressive body of work, let me tell you, and I really wasn’t let down by any of the profiles. But a couple of other things that stood out to me were this kind of — call it a nascent trend — but a trend toward ethical marketing. And I noticed this in the Publicis Health Media profile, where they were talking about how some of their pharma clients are [asking] questions about media placements from an ethical point of view.
And then, one other one, and this one’s kind of geeky but hey, we’re getting it all out there, but revamping internal processes [by] adopting an agile marketing style at work and co-creating with clients. I thought that was interesting, and I noticed that Havas Life mentioned that they’re adapting this new style of internal work that is making their internal processes much more efficient.
Dobrow: Yeah, I don’t want to say that there’s a problem with that, but a lot has to line up, there has to be willingness from the client’s side, there has to be a willingness from the agency’s side. But we’re seeing it line up so much more than we did, and the ones that are doing it are doing it well. Listen, these stories travel. Somebody does something well and they can achieve efficiency and nobody’s pulling out their hair and work products aren’t being saved into older versions and all the stuff that comes with it. That gets around, and I think we’re going to see a lot more of that, I agree.
Iskowitz: It’s also in line with where pharma is going in terms of adapting to the way startups work — working toward t a minimum viable product and failing fast. Those kind of techniques are where the chief digital officers are trying to push their CEOs to go, so it’s interesting to see the agencies following the trend. And also, to be fair, some of them have had these kind of processes in the books for years, but it’s nice to see these trends proliferating across the sector. I’ll defer to you on the up-and-comers; you talked to a lot of the ones in our Ones to Watch section, and you said your peace on that.
Dobrow: Yeah and, again, if we had three hours here I could certainly fill it with “This person’s doing good for this reason. This company’s doing good for this reason.” But it’s amazing how much A) new work is being done, how much innovative work is being done. You know, there’s not anything staid, there’s not anything boring about this. Hey, it makes our jobs a hell of a lot better, right?
You know, it’s not just one model: “And there’s the DTC ad with the nicely modernized kitchen — but not too modern — and the whole family’s coming down [the stairs] and the kid’s got headphones on…” all that garbage is being washed away, and hey, this is good.
Iskowitz: And hey, I’d be remiss if I didn’t mention two other things and that’s, one, the philanthropic efforts amongst a lot of agencies, like Fingerpaint, which really make that a calling card in terms of doing good and doing well; as well as, two, this real emphasis on talent and culture that we’re seeing, and really pulling out all the stops in terms of benefits and getting really creative in terms of recruitment. The agency world really is in the thick of a major talent war, and it just seems like it’s getting more and more competitive every day.
Dobrow: That’s a great point to bring up and I think that the agency that you mentioned, Fingerpaint, is a perfect example of it. Five years ago, they were much smaller than they are now. It has the reputation of a company that’s doing great work but also a really nice place to work, with nice benefits. Let’s be honest, you have the options of a company that will give you a little bit more versus the company that will give you a little bit less. For a lot of people, it becomes a hard calculation like that. The idea that you can do it at several companies here — and I think Fingerpaint is one of them, I think W2O is one of them, Patients and Purpose actually has gotten a lot of good marks in that regard — the fact that you can [have] the same work-life balance at a place that’s doing exciting work with nice people, that’s pretty cool.
Iskowitz: Yes and big agencies like Klick Health and FCB Health New York, they all seem to be doing a great job year after year in terms of recruiting and retaining. There are some marquee names that [get mentioned], and you have to recognize their efforts, as well.
Leonardo Lopez Carreno contributed to this report.