Why Your Digital Agency Should Become Your Agency of Record
This session, originally presented by C-4 Analytics on the Digital Dealer platform, addresses a critical strategic issue: the diminished strategic role of the traditional advertising agency. The traditional approach, bolted onto a digital world, is failing to deliver optimal results, and it's time to prove to your dealer principal that your native digital agency is better positioned to lead the overall advertising strategy.
The shift is not pending—it’s already happened.
The Irrefutable Data: The Tipping Point Has Passed
All signs point to the inevitable dominance of targeted digital advertising:
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Global Ad Spend: Digital advertising surpassed traditional advertising globally, accounting for 51% of total ad spend in 2019, before the pandemic accelerated the trend.
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Media Consumption: Eyeballs are moving rapidly from network and cable television to Connected TV (CTV). Radio listenership dropped significantly during the pandemic due to decreased commuting.
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Cost Efficiency: While traditional agencies profit from buried commissions on mass media, digital agencies offer transparency and efficiency by targeting in-market shoppers with measurable results.
It's no longer effective to allow an agency that profits from dying broadcast platforms to set a modern strategy.
The Problem: Inertia, Ego, and the Vig
Traditional agencies fight hard to keep their lead-dog status because it protects their revenue, not your dealership sales performance. This inertia is fueled by several factors:
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History: The relationship is decades old, and the agency helped build the business.
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Ego: Dealers enjoy the ego stroke of being seen on TV (e.g., riding a llama) and hearing their spots on the radio.
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The Vig: Traditional agencies rely on buried commissions from high-spend mass media buys, a payment structure that is not transparent in the way digital is.
The Solution: A Digital-First Marketing Plan
To make a data-driven case for change, you must prove that a digital-first strategy is the most efficient path to sales and share growth.
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Build from the Digital Bottom Up: Instead of seeing what is left after feeding traditional media, calculate your budget based on the required digital impression share. Start by owning the bottom of the Google funnel (rebates, deals, and offers), and then move up to "Where should I buy it?" and "Can I afford it?" moments.
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Challenge Traditional Agencies on Efficiency: Use Google's forecasting tools to show your dealer principal the massive disconnect between the cost of mass media and the cost of targeted digital. Digital provides a rev limiter—a measurable ceiling on impressions—while traditional media is an unchecked shotgun approach.
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Compel Action with Data: Show that traditional ads provoke a positive response (like getting her to think about a CR-V), but she then goes to the internet to shop. If your digital strategy isn't strong enough, you are only priming the pump for your competitors to capture the sale.
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Align with Your Agency's Goals: Ensure your digital agency is not conflicted. If your agency is helping your competing on-brand dealer, they cannot help you gain share. You need a partner who will fight to steal the sale for you.
The strategic role of the traditional advertising agency has diminished. It is time for them to move a few chairs down, closer to the crazy uncle, while your native digital agency takes the helm.
Watch the Full Webinar
For a deeper dive into these topics and to hear directly from Rob Stoesser, Vice President of C-4 Analytics, watch the full webinar below.