Anyone who’s followed the media and advertising world will notice a disturbance in the force.
I’m not referring to Jedi powers or meta-human strengths, but this one is strong enough to shake the ground beneath the feet of many traditional media agencies.
For decades the ad agency business is dominated by a handful of major players. It’s a lucrative business. They locked in multi-year media contracts in the tune of hundreds of millions of dollars. It’s a big payday.
But something tells me all that’s about to change in the coming years.
And if you haven’t noticed any changes, then you’ve come to the right article.
You have been warned about the media agency fallout
Yes, we’ve been warned by the media outlets and digital watchdogs that conglomerates are gradually losing their foothold to boutique agencies that are more nimble and innovative.
That doesn’t surprise me. In fact, I feel this rebellion is overdue.
Why? For too long agencies have prioritize profit above all else. I’ve participated in a handful of board meetings and 90% of time is spent on figuring out how to squeeze more profit out of the clients / business. But I’m sure this revelation doesn’t shock you.
Yes, a profitable business is a healthy business. And media agencies, or any business for a matter of fact, need to generate profit to stay in the game.
You can’t teach an old dog new tricks
Once you’re in the media game long enough and are set in your ways, it’s difficult to pivot or consider another’s input.
This behavior is quite prevalent across all industries. Sometimes it requires an entire executive leadership team to be replaced before a new perspective can be introduced into the company. Other times, the founder(s) are removed to facilitate change.
What I’m most amused about is the irony of large media agencies. While they preach technology innovation and creative prowess, the people who sit at the top are already having a hard time finding their dentures.
So who really run these agencies? Most of the time, I reckon to say it’s the senior executive teams who either moved up in ranks after years of services or an outsider from another agency.
Here’s one hiring mistake that agencies make. And we can agree to disagree. But in my opinion, the gravest mistake is to hire like-minded people, especially at the senior leadership level.
Why? Because status quo doesn’t inspire change or fuel creativity. It’s just the same thing, but with a younger version.
Show me the money
Major media agencies are driven by owning huge accounts from top brands. These agencies have perfected the art of delivering work and collecting a check, not in the particular order.
They deliver really great work — most seen on your television, Superbowl commercials,
Don’t get me wrong. The agency life can be enjoyable.
I used to work in one of these large media agencies running search marketing for brands like Jeep, Chrysler, etc. It was a fun gig!
But to introduce new concepts, a new way of thinking, and a different mindset — you might have more luck hitting the jackpot in Las Vegas.
And it’s not because change is not welcomed, it’s just takes A LOT to steer an oil tanker in a different direction once the course is set. It can be done. But it’ll take a while.
It is far easier and profitable to stay the course. After all, why change something that’s working. Right?
That is the mindset of the old agency model — yes, the one that I mentioned above is fading away gradually.
Let’s bring in the new generation of media players
Services like brand development, managed media spend, creative services, social media and content development are now more important than ever for any business focused on achieving brand endurance.
There are a handful of individuals who understand the value in delivering value to business and brands.
These individuals see the opportunity to join the game with a significant payout, and the prize is huge.
They launched they own creative ad agency and media agency to fill a gap of brand relevancy and engagement.
Without further ado…
From wine store to sold out seminars, from WWE to mega Disney star, from kickflips and skateboard icon to digital.
Yes, I’m referring to none other than Gary Vaynerchuck,
Dwayne “The Rock” Johnson,
and Tony Hawk.
Gary V’s agency, VaynerMedia is probably the most visible in this bunch.
Dwayne Johnson’s agency is Seven Bucks Production. and Tony Hawk’s agency is D/CAL.
This is significant because of the investments that these people have put into launching their agency. I’m am not going to say they are going all-in. But I would hypothesis that it’s a significant financial commitment.
Additionally, it is safe to say that A LOT of people around the world recognize any of these names — and if you don’t, now you do.
A challenge many boutique agencies face is the lack of brand awareness. But not for these guys. They’ve got that part figured out, haven’t they?
Why are celebs getting into the media agency game
So that brings me to this. Why are these individuals just now getting into the media game?
It wasn’t a matter of IF, but WHEN. They are intelligent individuals who have plenty of successes under their belts. They’ve all gone through trials and tribulations, like many of you have. But they’ve just gone the extra step that allowed them to separate from the “pack.”
They have pivoted and adapted to tides of life, succeeded and failed in their fair share of business ventures, and the most important thing is — they also bleed and their blood is red just like ours. So yes, they are no different than us – at the end of the day. Keep that in perspective as you continue reading.
Nonetheless, it’s worth paying attention to these guys.
Most of the reasons why people like Gary, Tony and Dwayne are getting involved are straight forward.
#1: They are their own brand
They’ve worked their asses off over the decades to build their personal brand.
Mention movies like Jumanji and Moana, people associate it with The Rock. Talk about skateboard legends and Tony Hawk’s name will be in the top 3. Gary’s name will come up in conversations among wine enthusiast.
They’ve put in the hard work. They’ve suffered the growing pains. They are now, in their own right, a brand.
Let’s face it. It will take me months, if I’m lucky, to put my ad agency in front of a brand like Ford to run a sub-portion of their digital media. On the flip side, an agency like D/CAL or Seven Bucks Productions with a celebrity attachment would get a meeting within days.
That’s the power of their brand, and they know it.
#2: It’s easier to attract big brands
When I announced the launch of my ad agency in 2017, I received a healthy amount of congratulations and pleasantries.
And a few leads trickled in from that announcement – so it was great.
But for these guys, big brands are lining up to work with their agency — mainly to leverage the association of stardom.
In my pitch, I talk about the value my agency can add for the brand and show them results and case studies.
Now, imagine a pitch with Dwayne Johnson. I reckon that would be an entirely out of this world experience. Do you dare question how to build your brand in front of The Rock?
Or if you were a sports brand and Tony Hawk pitched you on how to build your brand’s awareness. Would you question his strategy recommendations?
Would you demand for case studies? If you are the VP of Marketing for any major brand, let’s be honest…you’re not there to validate his portfolio and credentials.
The contract is already “signed” before the meeting – because it is desirable to work with an agency who’s founder is a well-respected public figure.
#3: Their reputation is at stake
This is one thing that every entrepreneur, big or small, risks when they launch their business — their reputation.
Yes, people like Gary V., Dwayne Johnson, and Tony Hawk have more to lose than most of us. It’s all relative.
But they know what they’re doing — and importantly surround themselves with the best team.
Increasing your personal brands’ relevance is just as important as helping clients develop theirs.
Let’s take for example Gary Vaynerchuck’s K-Swiss collaboration. He sold out of his sneakers overnight when he announced the release of it. This was more than a product partnership. If we’re willing to push our minds a little, one could consider this was Gary’s way of practicing what he preaches.
How?
He’s a champion for brand awareness. So what better way to prove his point than to leverage his brand to launch a product and put it into the hands of thousands of followers. His reputation was at stake — but of course, it might have already been rigged to win.
#4: Diversifying their personal portfolio
Every savvy financial adviser will advice you to diversify your investments and portfolio — that’s if you have enough to diversify.
And even if these guys are clueless about fiduciary responsibilities, they can surely afford the best financial planner money can hire.
None of them have all their eggs in one basket. Each one has multiple line of investments and businesses.
Dwayne won’t be able to star in movies forever, he knows that. Tony Hawk knew his skateboarding career has an expiration date. Gary V. knows another agency will come along and be as audacious as he.
They are in a position to create multiple streams of revenue to ensure they’re not beholden and victim to sudden shifts by a single industry.
This move is very obvious to everyone — I’m 100% positive.
#5: More lucrative with less effort
A media agency is a lucrative business if run well. Why? With the right team in place and a streamlined process, an ad agency’s profit margin can be north of 30%.
It does take a certain mindset to turn this opportunity into a lucrative operation. But they have what it takes — they’re entrepreneurs at heart.
Everyone has passion projects; those that are not launched to focus on profit. If we can be honest here, a brand agency, ad agency, media agency, whatever you want to call it — it’s a cash-generating machine — especially when you are as well connected and can attract big money like The Rock or Tony Hawk.
Yes, you do need a passionate about branding to even consider investing your time, money, and effort in launching an agency.
It is hard work, but the ROI is clear when clients are excited about your campaigns and your team celebrates a job well done.
At the end of the day, they saw an opportunity, they had the right team, and they went for it. It’s simple as that.
#6: They know the game better than anyone else
Ain’t that the truth!
There are many other successful individuals who have built personal brands — but these guys, I would reckon are next level in this game for now.
What do I mean by that?
Well, they know their audience. They understand what their audience is looking for, the produce content that is relevant (whether it’s movies, seminars, videos, etc) — it doesn’t matter.
They know what people want, have a cross-hair target locked in, and unleashing their best content into the world of hungry consumers.
#7: It’s easier for them to take this risk
One of my pet peeve is hearing celebrities and the rich talk about going all-in, or taking risks, or don’t worry about money, or your time will come.
Truthfully, that’s a load of idealistic crap that needs to stop. When you are sitting on $40M in the bank, it is easy to no worry about money, or going “all-in,” which usually means investing a portion into a new business venture.
Not everyone can take risks without a reasonable backup plan. That would be categorized as being irresponsible and stupid.
Compounding on the ideals are stories we hear about how some entrepreneur lost it all and slept in their car for years, eating ramen, wearing the same clothes, and never gave up — then years later, turned their life around and built a multi-million dollar business.
It does sound heroic and motivational. But it’s unrealistic — because you don’t hear about the people who went all-in and fell flat on their face, with nowhere else to turn to, and ended up on the streets.
There’s both sides of each coin!
When Gary decided to launch his EmpathyWine, he was taking a risk, but it’s calculated and launched with specific objectives in mind. But let’s say the wine idea was a disaster, he won’t be struggling to find money to pay his mortgage.
If Seven Bucks productions went belly up, Dwayne is not going to lose sleep over how many pizzas to eat during his carb load days.
The difference for you and them is The Cushion. And theirs is packed with down feathers for the most comfortable landing if they fall flat on their asses.
Conclusion
In the grand scheme of things, these celebrity agencies are still not commanding a major portion of media dollars.
So if you are an entrepreneur thinking of launching your ad agency, there’s still plenty to go around.
I recommend following their social pages and stay up to date with what they’re talking about. You never know.
You might draw a few nuggets of inspiration and take your business to the next level.
Here’s their social profiles:
Gary Vaynerchuck
Agency:Â https://vaynermedia.com/
Twitter:Â http://twitter.com/vaynermedia
Facebook:Â http://facebook.com/vaynermedia
Instagram:Â https://www.instagram.com/vaynermedia/
Dwayne Johnson
Agency:Â https://sevenbucks.com
Facebook:Â https://www.facebook.com/SevenBucksProd
Instagram:Â https://www.instagram.com/sevenbucksprod
Twitter:Â https://twitter.com/sevenbucksprod
Tony Hawk
Agency:Â https://www.dcalagency.com/
Twitter:Â https://twitter.com/dcalagency
