Convince and Convert Blog: Digital Marketing for Advertising Agencies and PR Firms

Because of its simplicity and immediacy, Twitter enables brands to win the 1:1 battle with customers and potential customers in ways that even other social media constructs cannot. The density of Eureka! moments on Twitter is quite high, and if brands use it right, it’s the ultimate weapon for turning lemons into lemonade.

Let’s examine two recent personal examples:

Twitter Done Right, Conference Style

Recently, I was a speaker at the ExactTarget Connections conference in Indianapolis. Like all good digital marketing geeks, I was monitoring the Twitter conversation by setting up a search for “#ET08″ (the official conference hashtag) and “Exacttarget” on my Twitellator Pro iphone app. (this can also be done using http://search.twitter.com).

I come across the tweet below from Andrew Eklund, CEO of Ciceron, a Web marketing firm in Minneapolis.

Note that this conference had sold out at 1,200 attendees. A possibly soon to be disappointed Mr. Eklund was headed to the hotel from the airport. However, Dawn DeVirgilio runs the @ExactTarget Twitter account and was also monitoring conference tweets.

She rushed to the registration desk, signed up Mr. Eklund for the conference, and had a name badge and complete registration package ready and waiting by the time he made it to the hotel 15 minutes after his initial tweet.

That’s the power of Twitter-driven customer service.

Twitter Done Right, Reply Style

Social media is all about timeliness. I have an RSS feed of any tweets that mention my name or company name. Apparently, folks at the National Hockey League are doing the same thing.

My recent post about the NHL’s new ad campaign and its missing social media and digital marketing ingredients was answered almost immediately by Mike DiLorenzo, the Director of Corporate Communications for the league:

I then had a very interesting series of email exchanges with Mr. DiLorenzo about the NHL and its future social media plans. Fantastic! Talk about listening and responding with an authentic voice. To think that an NHL executive found my post through Twitter, acknowledged its merit, and then talked to me about it within 18 hours is simply extraordinary.

Twitter Done Wrong, Travel Style

I’ve spoken at a ton of conferences lately, and while I’ve been absolutely blessed with on-time airline travel, I’ve been bedeviled by a series of crappy hotel rooms. The nadir may have been the Westin in Indianapolis, where I must have had the worst room on the property. I sent out this missive via Twitter:

No response whatsoever from the hotel or Westin corporate. Given that nothing incites passion like travel, you’d think social media monitoring would be a MUST for a company like Westin. Evidently not.

I’m no Chris Brogan, Joseph Jaffe, or Jason Falls (yet), but I do have ~475 followers on Twitter (and a 92 on Twitter Grader). That’s 475 people (in theory) that saw me bitch about the Westin in Indianapolis (including at least 15 people who were staying at the same hotel). Can I determine the precise consequences for Westin as a result? No, but I don’t think it’ll help them. And I won’t be back.

Do you have stories of good or bad Twitter usage? Comment ‘em

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The National Hockey League has rolled out a series of compelling TV spots featuring some of the game’s biggest stars.

And while the new commercials - with a theme of “Is This The Year?” will run nationally on Canadian broadcast and U.S. cable television, like so many campaigns, it’s being forced to go it alone.

How About Some Synergy?

Instead of launching an integrated effort, it appears that this is a TV-only exercise (created in-house by the NHL with creative consulting from Y&R).

- A search for “NHL” on Google finds no mention of the campaign in either paid or organic listing.

- The official NHL Facebook page doesn’t mention the campaign, and doesn’t link to the ads.

- The spots are not on YouTube (although they are on the NHL.com site).

- The ads are not specifically touted even on the Web sites of the featured players’ teams.

A Huge Social Media Opportunity

If there’s one sports league that could and should capitalize on social media marketing, it’s the NHL. It’s downright cultish, and very few people are ambivalent toward it. So many easy social media programs could be launched.

Contests to make your own “Is This The Year?” commercial. Contests to describe why this is indeed the year for your team. Guest blog posts from the players in the commercials. Uploading the spots to YouTube, including a “Making Of” video that shows how the innovative commercials were produced. Linking the spots from players’ Facebook pages.

And in the digital marketing realm, campaign elements might include: buying banner ads that include the commercials using rich media, video ads on Hulu.com and other sites, buying PPC ads that link to the spots, and having each team email links to the commercials to their season ticket holders.

The geo-targeted possibilities are enormous, because the NHL actually cut 2 local versions (featuring local stars) for every team in the league, and these spots will roll out soon after the national effort launches.

It’s amazing that the NHL would create what appears to be something like 70 TV commercials, and not back them up with anything in the digital marketing or social media marketing universe except for putting them on their own site.

Do you agree, or am I being too hard on the ice gang? Other examples of missed social media opportunities?

I’m on Twitter @jaybaer
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From Dot Bomb to Dot Boom

Let’s face it. The economy is taking on the distinctive, sickly pallor of a post Mardi Gras Keith Richards.

Generally, recessions hit the advertising business with the ferocity of a rabid wolverine, and the last one trimmed overall ad spending by 9% according to market researchers Veronis Suhler Stevenson. The wolverine in question mauled and devoured online advertising, which plummeted 27% over two years during the last recession.

This time it will be different. Not only will online marketing survive, it may actually thrive during the lean times, continuing its inexorable theft of ad spend from traditional media tactics. Online is far more mature and proven now, and there are five specific reasons why it will be the go-to tactic among increasingly budget-conscious marketers.

Money Talks

First, online is typically less expensive than many other marketing tactics, and a sizable and impactful online effort can be undertaken more quickly and cost-effectively than can an offline campaign.

Wiggle Room

Like an Elizabeth Taylor marriage, online doesn’t require much long-term commitment. PPC ads can go up and down on a day-to-day basis. Email can be sent (or not sent) based on financial considerations. Even banner ads can usually be negotiated with an advantageous cancellation clause of 72 hours or so. Try that with your local TV station or newspaper. Other than keeping your Web site up to date, the only core online tactics that require substantial ongoing effort are organic search optimization, and Web site analytics and testing.

More Juice for the Squeeze

With diminished outbound marketing budgets, companies will shift focus toward increasing revenue from current customers, either through more frequent purchases, or larger ones. Email marketing is the perfect vehicle for communicating with customers and incentivizing additional purchases. Customer lifecycle marketing (persuasively combining email with direct mail, voice mail and text messaging) will gain favor as companies strive to close a higher percentage of a reduced flow of leads.

Waste Not

There is meaningful financial waste associated with advertising to people who have no interest in your product or service. The superior targeting ability of online marketing will enable companies to focus their reduced marketing dollars solely on likely prospects. This will accelerate the trend toward use of behavioral targeting and retargeting in online ad placement.

Behavioral targeting mines a person’s Web page visits and search terms to serve relevant ads. If a prospect reads several pages on Yahoo! about Nissan Altimas and does a search on Yahoo! using a related term, an ad for Valley Nissan dealers can be served up just in time.

Retargeting (a nascent industry led by local company Fetchback) takes the concept one step further, enabling companies to advertise only to people who have visited their Web site previously without making a purchase. With average conversion rates hovering around 2%, this is an ideal way to reach the other 98% that have taken the time to visit your site but haven’t yet converted.

Additionally, search marketing will continue to expand since it is the only tactic (other than Yellow Pages) that puts the marketer in the middle of the consumer’s purchase psychology funnel. I expect heavier bidding on specific, “long tail” search terms that often correlate with greater intent to purchase.

Numbers Don’t Lie

Online marketing of all types offers superior measurability and trackability in comparison to traditional tactics. This is of course due to the Orwellian nature of the Web, where every mouse click is tracked, usually anonymously. While the availability of this data may give you the same creepy feeling you get when gazing upon Joan Rivers, it makes for effective marketing.

When implemented correctly, banner ads, organic search, paid search, blogs and social media, email, lifecycle marketing and all other online marketing tactics provide a user by user scoreboard that can be utilized to ascertain precise return on investment metrics for each campaign.

In this way, online marketing provides companies the ability to test a wide array of tactics, evaluate which generates the best response, and then adjust the marketing program accordingly.

The old saying is “I know half my marketing dollars are wasted. I just don’t know which half.” This problem is even more acute and painful in a down economy when advertising dollars are curtailed. The inherent cost, targeting, and tracking advantages of online marketing make it more likely to succeed (or at least able to minimize losses from a failed campaign). And when a wolverine is at your door, that’s the type of assurance you want from your marketing strategy.

How I help ad agencies & PR firms get better at digital marketing>>
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It used to be that you actually met someone in person first, and then developed and nurtured that relationship into its natural culmination - helping them move.

The Web and social networking has changed that, and now friendships are developed in a variety of digital forums, eventually moving offline and becoming three dimensional.

Below are the Before Social Networking and After Social Networking friendship development scales. Each step in the relationship is measured as a % of how likely you would be to help somebody move.

Do you agree? Is this how your online relationships grow today? PR Firms, is this how you’re developing relationships with reporters and bloggers? Leave a comment.

Before Social Networking Friendship Scale

After Social Networking Friendship Scale

My training and consulting programs for ad agencies and PR firms

I just finished giving a speech at the western region meeting of the National Council for Marketing & Public Relations in Sedona, Arizona. 

NCMPR is the association of community and technical college marketers. A really interesting group that needs to harness social media and work with prospective students on an individual, relevant, highly personal basis. 

While this presentation was specifically for NCMPR, there is a lot of material that will be valuable to anyone looking to launch and maintain a social media and digital marketing program for a mid-sized business or organization. 

Key points in this presentation:

- Media outlets have exploded, causing audience fragmentation

- You have to communicate to audiences individually, because they don’t herd together like the old days

- Using the power of audience segmentation

- Digital marketing is critical in this new hyper-targeted marketing world, because online users identify themselves through their search queries and site usage

- Ways to find prospective community college students (Twitter, Facebook, Blog search, Flickr)

- Web site is the key to translating awareness of your college (or any brand) to action

- Web content needs to be transparent, real, and multi-modal

- Lead acquisition is critical for colleges. Give users multiple call to action options. 

- Secrets to good form design

- Web site testing and optimization basics

- Lead nurturing via personalized follow up and triggered communications

Comments are very much appreciated. Enjoy. 

The demise of email has been greatly exaggerated.

While Jupiter says that overall email volume has dropped from 41 messages per day per U.S. user to 24, the email marketing universe is very much alive and well. The Direct Marketing Association (DMA) projects that $600 million will be spent on email in 2008, driving an astonishing $27 billion in sales. That’s $45.65 in revenue for every dollar spent on email marketing, an ROI figure that’s nearly impossible to match outside of the bottled water and pharmaceutical industries.

But, the increasingly vigorous expectations and demands of email recipients are changing the game. An electrifying survey by Marketing Sherpa in August, 2008 showed that 41% of subscribers believe an email to be spam if it is not of interest - even if it’s email they requested. There’s a Saturday Night Live skit in there somewhere. You meet someone at a party and they end up being boring and irrelevant, so you can click a spam button and they disappear forever.

Targeted = Relevant = Wanted = Successful

Consumer demand for email that meets their specific needs mirrors the surging desire for authentic, 1:1 conversations with brands via social media outlets. Regardless of medium, today’s consumers want to be talked with, not talked at.

This is troublesome for many email marketers who continue to adhere to the longstanding practices of sending an email “blast” or “campaign” to a “list” and hoping that 5% of the recipients take action. This is the definition of surgery with a dull knife, and the patients are starting to revolt.

Further, in many circumstances email may not even be the optimal message delivery mechanism. Text messages, voice mails, good old direct mail, Twitter, and other outlets can be more appropriate and more engaging for consumers at times.

The promise of a hyper-targeted and relevant message, delivered at the right time, to the right person, using the right medium is holy grail marketing, and its the new focus of ExactTarget, the leading email service provider that’s morphed into a robust, centralized messaging system.

(disclosure: I’m an ExactTarget customer and was a speaker at their Connections user conference this week in Indianapolis)

ExactTarget is trumpeting this new era of multi-modal, targeted messaging under the mantra “Subscribers Rule.” Essentially, it’s an umbrella position for “give people what they want, even if it’s a text message in Portuguese at 3 a.m. featuring coupon codes for mittens.”

This notion of 1:1 marketing has of course been the rallying cry for digital marketing since its inception. Historically, the problem has been gathering enough information and insight about your customer base to be able to fashion customized, truly relevant messaging. In the past, you’d have to mine e-commerce data or implement a sweeping audience segmentation study to do it right, and then you’d build an e-mail campaign around it.

Now however, ExactTarget and its burgeoning network of partners are enabling email itself to be used as a segmentation tool. Advanced link tracking, integrations with Web analytics software like Omniture, and a new user-controlled engagement score feature (whereby you assign a numerical weight to subscriber activities like email opens, clicks, purchases) allow the sophisticated marketer to learn a tremendous amount about their audience based on their email-driven behavior, and then use that feedback loop to create and send ever more relevant and timely messages.

Additionally, a thorough program of triggered messages (sent individually based on Web site behavior) can provide tremendous information about a subscriber while simultaneously delivering hyper-relevant and timely information.

I Get Sign Ups With a Little Help From My Friends

A second very interesting opportunity presented by the centralized messaging platform concept is the cross pollination of message delivery vehicles. The most buzz-worthy example is “email opt-in via text” whereby consumers can use short code text messaging to sign up for highly targeted offers and other communication from a brand at point of sale. This could render the physical email opt-in form moot at retailers and restaurants, and would make opt-in immediate (enabling instant couponing, etc.).

Imagine you’re in a check out line at Petsmart and you see a prominent sign that says “for $5 off Iams dog food, text “Iamsdog” to 23907. For $5 off Iams cat food, text “Iamscat” to 23907.” Instantly, the brand knows whether you have a dog, cat or both, has added you to its database, and you get a valuable and relevant coupon immediately. Slick - and not terribly difficult to execute.

Lions vs. Lambs

As this multi-modal, 1:1 marketing gets more prevalent, the software needed to run it and the expertise needed to strategize and manage it are becoming commensurately larger and more complex. Interesting then that ExactTarget is rolling out a formalized partner program (similar to Microsoft, Oracle and other enterprise software companies) that will features specific partner tiers, certifications and other “badges” to distinguish among specific expertise. This should assist clients in selecting the most appropriate agency partner for their 1:1 marketing efforts, and agencies will have a codified program for reselling the software and providing services to augment it.

I’m on Twitter @jaybaer
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I am of a vintage that was shaped by Van Halen’s album (actually a cassette for me) 1984. With Jump, Panama, and Hot for Teacher (a video that joins “Hungry Like the Wolf” in my early teen pantheon), this was a truly epic record - highlighted by David Lee Roth’s bad boy caterwauling. 

And then, he screwed it up. Went solo. Recorded novelty hits like Just a Gigolo and California Girls, which were only slightly more legit than Weird Al Yankovic shlock. 

From 1985 until the inevitable bittersweet reunion tour in 2007, both Roth and his former band mates suffered, never recapturing their former glory (despite the yeoman efforts of Sammy Hagar). 

Internet Marketing is Not a Solo Act

Ultimately, it was proven that David Lee Roth was better as part of a group, than he was a solo artist. And the same is true of your Internet marketing efforts.

Many (and perhaps even most) agencies I talk to are trying to add digital marketing services to their capabilities by hiring their own David Lee Roth. A guru. A turtle-necked Web geek that can do it all. Don’t make that mistake.

Here are 3 reasons why the one man show routine doesn’t work.

1. It’s Unknowable

Digital marketing is a paradigm and a platform, not a job function. You can’t hire somebody who does “digital marketing” the same way you hire a copywriter or an account executive, or an art director. The field of Internet marketing is now far too broad and the nuances too numerous for one person to be able to cover all the bases on a practitioner level.

There is no way I could actually execute on the full array of tactics the way I did in 1995-2002 when the variety of tactics was semi-graspable.

The biggest mistake agencies (and clients) make is believing that the same guru that is designing and/or programming Web sites on your behalf can also handle the marketing of those Web sites. They cannot. The two skill sets are almost opposites.

Web design is a project-based, creative, inward-facing, technology-driven process. Internet marketing is an ongoing, methodical, outward-facing, relationship and message-driven process. Other than a little initial search optimization on recently completed sites, Web designers are not doing Internet marketing.

2. Knowledge in a Silo Cannot Expand

I very much believe that eventually we won’t have digital marketing departments or even digital marketing agencies. As digital (Web, mobile, digital outdoor, etc.) becomes fully integrated into the lives of a majority of the developed world, “digital marketing” will be a component of every campaign.

This convergence is already happening. Public relations and search engine optimization are blending. The growing use of video advertising online. Direct mail campaigns that use personal URLs that lead to individualized landing pages - are those “traditional” tactics, or “digital” tactics?

Eventually, digital won’t be given the special treatment the way it is today. You wouldn’t have a “radio department” and eventually you won’t have a “digital department” either.

If digital will be a part of everything, isn’t it imperative that everyone in your agency (or in-house marketing department) understand digital marketing to some degree?

If you have a guru, it gives EVERY other member of your team a built-in excuse (that you provided) to not have to get up to speed on digital marketing.

3. Asking for Trouble

If you hire a guru to handle all of your digital marketing and centralize that understanding, it creates an operational bottleneck in your organization. It’s not even a hub and spoke model. It’s just hub. Every brainstorm that requires digital thinking requires the guru. Every client meeting. Every pitch. When the guru is sick, the digital effort is grounded.

Plus, how many accounts can the guru work on competently?

It’s an extremely inefficient way to manage your personnel.

Further, since the guru gets to work on all the big accounts (because all the big accounts will want digital marketing), the guru develops quite a resume. Consequently, the guru will be endlessly recruited (perhaps even by your own clients). Eventually, the guru will leave for another opportunity that doesn’t require the ball juggling of an agency, and may include free lunch, stock options, and a big office.

Trust me. The guru will leave.

And then what? When the sum total of your organization’s digital marketing expertise walks out the door, how do you keep providing services to current clients, much less attract new ones? Typically, agencies faced with this scenario try to find Guru 2.0 which of course just perpetuates the problem.

Don’t Be Seduced by the Guru

I know fully embracing and integrating digital marketing is hard. If it wasn’t, I wouldn’t have started a consulting company to assist. The pull of hiring one person to make the pain go away is strong. But don’t fall for it.

Make a plan to distribute responsibility for digital marketing tactics to multiple members of your team. One person handles SEO. One person handles Email. One person handles online media buying. Clearly, once you have a concentration of clients that need digital marketing services from you, you may want to add staff to work on tactical execution. But until then, remember one critical fact:

Internet Marketing is Complicated, But It’s Not Hard

If your staff is bright enough to work for you, they’re bright enough to figure out part of the digital marketing arsenal.

Do you agree? What are your cautionary tales or success stories about Internet marketing gurus? I’d love to hear your comments. Let’s discuss.

Do you need to know whether people on a Web page are clicking on the navigation, the logo, photos, or links in the text? Of course you do. And ideally, you should be tweaking your pages and testing often to maximize results. (that’s why we’re on version 3.2 of the Convince & Convert Web site copy in 9 weeks). 

For specific areas of digital inquiry like this, it can be easier and more useful to utilize specialized software rather than navigate through the massive array of features contained in an enterprise application.

If you need to figure out which elements of a Web page are getting clicks, and measure versions against one another, CrazyEgg is the answer. This simple software program only does a couple things, but it does them exceedingly well in an ultra easy to use fashion that puts it in the same “why isn’t all software this good” category with Basecamp, iphone, and Conceptshare. It’s Web-based (nothing to install), works in just about any browser, and handles analysis quickly.

CrazyEgg also lets you filter out internal usage (for more accurate reporting) by clicking a link in your dashboard or by sending an email to users you don’t want to appear in your reports. 

Web analytics and click stream data at your fingertips

Here’s how CrazyEgg works.

1. Sign up for an account. Fees range from $9 per month to $99 per month for deluxe version, based on how many different Web pages you want to track, and the number of combined monthly visits to those pages.

2. Add tracking code. Paste one simple line of javascript into the HTML of the Web pages you want to track. This should take approximately one minute, and if your Web developer or IT department says differently, they are being difficult and you should immediately bribe them with Red Bull or an XBox game. 

3. Wait for traffic to come. Once you have visits to your Web pages, you’ll be able to access your CrazyEgg reports online instantly. (alerts and other information can also be sent to you via email or RSS).  Reporting is where this system really shines. They offer multiple, highly visual ways to view click stream information that is far more compelling than a spreadsheet. For instance:

OVERLAY

- Clicking [+] for each links shows how many times that link has been clicked, and the more+ link shows you from where each clicker came (and their search term if they come from search). I can see that 16% of the 44 people that clicked “Digital Marketing Blog” from my home page came from Google. It also tracks outbound links, so I can see what other blogs in my “Links We Like” section get clicked.

CONFETTI

- Shows colored dots representing clicks on each link. Every color represents a different referring Web site. This is very useful for visually determining click pattern differences between visitors coming from Google and typing in www.convinceandconvert.com directly, for example. (Orange and Red, respectively)

HEAT MAP

- Perhaps the easiest to grasp and the most awe-inspiring report, the heat map shows frequency of clicks through color variations. Brighter colors = more clicks, so I can tell in one second that the “Digital Marketing Blog” link on the home page gets significantly more clicks than anywhere else on the page. 

If I wanted to see whether I should rename “Digital Marketing Blog” and change it to “Internet Marketing Blog”, I could make that change and then start a new CrazyEgg test. Comparing the before and after results reports is incredibly simple, and telling.

No Excuse for Not Running A/B Web Site Layout Tests

Many agencies and client marketers I speak with believe that methodically testing landing pages (see blog post about landing page testing), shopping carts, and other key Web pages is a huge hassle. It’s not, and CrazyEgg can help you get into a habit of testing.

For agencies, the perceived value of CrazyEgg’s heat maps, etc. is very high for clients and its a system that for $9-$99 per month, I recommend universally.

Have you used CrazyEgg? Something similar? Are you ready to start testing? Leave a comment.

AdWeek announced today that security software maker McAfee has hired Tribal DDB as their agency of record. In addition to digital marketing, the assignment includes TV, print, and outdoor. 

Note that Tribal DDB is the excellent digital marketing sister of DDB. These guys know their stuff. I’ve met a few Tribal DDB folks via my work with ExactTarget. But historically, Tribal DDB has been a large but “regular” digital marketing shop. 

Warning. This is just the beginning

Tribal didn’t just beat out a bunch of other digital firms for this account. They were selected as AOR over big league integrated shops including Young & Rubicam and Dentsu. Wow.

As I’ve been saying (especially in my post “Agencies Wake Up - Digital Shops = Trojan Horse“) digital marketers have a much better handle on ROI, testing and optimization, and audience segmentation than do most of their traditional counterparts. Clients increasingly want to minimize ad risk and are willing to engage in several targeted tactics rather than one huge TV campaign.

If the traditional advertising agency community doesn’t see this win by Tribal DDB as a clear sign that the game is changing, I don’t know what will.

What is your agency doing to be able to compete with digital specialists?

How long will it be before digital agencies being agency of record becomes commonplace, rather than an exception? Leave a comment and let me know what you think. 

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My 5 Workshops that train agencies on Internet marketing

Web services giant Sapient recently fielded a national online digital marketing survey of more than 200 chief marketing officers (CMOs) and senior marketers responsible for managing digital budgets (among other things).

Survey respondents were asked about the top qualities they sought in their advertising and marketing agencies in the coming year.

Sapient’s Top 10 Wish List for Agencies of the Future…and My Comments

1. Greater knowledge of the digital space. With more than a third of marketers surveyed revealing that they are not confident that their current agency is well-positioned to take their brand through the unchartered waters of online digital marketing and interactive advertising, it’s clear that agencies need to have a greater knowledge of the digital space in order to thrive. In fact, nearly half (45 percent) of the respondents have switched agencies (or plan to switch in the next 12 months) for one with greater digital knowledge or have hired an additional digital specialist to handle their interactive campaigns.

This is another in a series of warnings from me that traditional agencies NEED to get uber-competent at digital marketing now. Clients are switching agencies based on digital marketing knowledge. See my post “Wake Up Agencies - Digital Shops = Trojan Horse” for more.

2. More use of “pull interactions.” When trying to engage consumers with their brand, 90 percent of respondents agree that it is becoming increasingly important that their agency uses ‘pull interactions’ such as social media and online communities rather than traditional ‘push’ campaigns.

No question this is true, and it will be even more acute in 2010 when Millennials (who prefer organic sources of information and recommendations) become a larger demographic cohort than Boomers or Gen X. 

3. Leverage virtual communities. An overwhelming 94 percent of respondents expressed interest in leveraging virtual communities (public and private) to understand more about their target audience.

This one is a little fuzzy for me. It sounds like market research using social networks. That can work, but if this list is in order, no way is this #3 for the future of agencies. On a related note, check out Rapleaf. They take a database (your client’s email list, for example) and cross-reference it against all the social networks so you can figure out if you should emphasize MySpace, Facebook, LinkedIn, or something else. Cool, and potentially massively useful. 

4. Agency executives using the technology they are recommending. Ninety-two percent of respondents said it was ‘somewhat’ or ‘very’ important that agency employees use the technologies that they are recommending. For example, it is important that agency executives regularly use Facebook, Flickr, wikis, blogs, etc. in their personal social media mix.

The fact that this even made the list is an indictment of the advertising profession. If you’re going to pitch a social media campaign to a major client, you might want to have a Twitter account (among other things). It’s like SEO firms that aren’t ranked anywhere on Google for their own services. The Emperor has no clothes.

5. Chief Digital Officers make agencies more appealing. Forty-three percent of marketers surveyed said that agencies with chief digital officers are more appealing than those without.

I agree that having somebody in charge of digital strategy in an agency can be beneficial (disclosure: I had this role at Off Madison Ave for nearly 3 years). However, that approach only works if the agency has many digital experts, and just needs someone to steer the ship. Too many small and mid-sized agencies far prey to the “guru syndrom” and hire one Internet guy to handle all digital marketing for their agency. Big mistake. If that guy leaves (and he will), you’re screwed. And, centralizing digital expertise gives the rest of your staff an excuse to not get better at digital marketing. Don’t do this. See my series of training workshops for agencies on how to not get your whole agency competent at digital marketing. 

6. Web 2.0 and social media savvy. Sixty three percent of marketers surveyed said that an agency’s Web 2.0 and social media capabilities are ‘important/very important’ when it comes to agency selection.

Yes. Related to a couple of the points above. However, it’s critical for agencies to have a social media strategy for their clients, not just a random collection of social media tactics. Building a wikipedia page is not a strategy.

7. Agencies that understand consumer behavior. Seventy-six percent of respondents deemed this as an ‘important/very important’ aspect of their agency’s online digital marketing and interactive advertising area of expertise.

Isn’t this what agencies are supposed to be doing now (never mind the future)? This will be a huge determinant on agency winners and losers in the future, because Google and others will take away agencies’ revenue streams that are procedural rather than strategy and creative-driven. See my post about Google looking to crush agencies for scary details. 

8. Demonstrate strategic thinking. Seventy-seven percent of marketers surveyed ranked strategy/brain trust capabilities at the top of their agency wish list.

Yes. See #7. Same thing in my book. 

9. Branding and creative capabilities. Sixty-seven percent of respondents ranked branding at the top of their agency wish list while seventy-six percent ranked creative capabilities as ‘important/very important.’

This one is definitely more future looking than some of the others. At present, especially for the mid market, digital marketing can sometimes be very successful without great branding. But that will change, and agencies MUST get their creative teams comfortable with digital. How do creative directors get away with “I don’t really understand online, so I have our junior art director do that stuff”? Would that work for radio? For outdoor? For magazine? Well guess what, Internet advertising is larger than all three of these media types (U.S. annual spend).

10. Ability to measure success. It’s no surprise that marketers want an agency that can report on where campaigns succeeded, fell short and where they should be fine-tuned. Sixty-five percent ranked analytics at the top of their agency wish list.

This is the secret weapon of digital marketing and what makes it superior to traditional in some ways. Agencies that aren’t using the inherent measurability of interactive marketing to their advantage are missing the boat. The reason digital marketing will thrive in the recession is its targeting and tracking components. 

What do you think? Are there other attributes the agency of the future must have? Jetsons-style flying car? Extreme Wii proficiency? Please leave a comment with your ideas.

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