Hi there. I'm Matt. Don't hate the player. Hate the game.1

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Jan 19, 2009 | Comments

Who best understands Twitter’s business model? The thousands of bloggers speculating on off-beat ideas, or the founders? Pay a certain agency $200,000 and they’ll give you 50 ideas, but only Jack Dorsey understands the most feasible approach.

Sadly, mature companies continue to choose the expensive route: hiring a marketing agency.

Strategy. Design. Branding. These are not difficult ideas; no certification or technical education needed. Could an employee with three years of tenure produce comparable results?

“But Matt, Agencies are experts in the subject. They can do it so much better and efficiently.” This is definitely true for technical problems (those requiring a degree or special knowledge). But most agencies are not experts. Amex understands Amex’s business better than any agency. It would take years for an agency to absorb all of the tacit knowledge required to produce quality work.

The time and resources needed to conduct appropriate research strain the agency’s absurd business model. Digitas may secure a $200,000 project, but revenue is squeezed by competition and expenses associated with RFPs, SOWs, and business development. Throw in overhead and I have no clue how they make money (check out the underperformance of WPP, Publicis, and Omnicom).

Corporations of the world: train your staff. Hire some digitally savvy employees. Hand expensive strategy and design projects to some motivated entry-level employees. Pay the expensive guys once something technical is needed. The results will be astounding.

Additional Reading:

  1. Agencies are Dead
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  1. Man, this concurs with my thinking. But how do you feel now that *you* work for a firm advising companies? 

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