I plead guilty to enjoying a cold beer or two, and I’ve watched with amazement as the decade-long bull market in the craft beer industry shows no signs of abating.
Like many marketing executives, Ken Stellmacher, director of consumer marketing at eye-care insurance giant VSP, is interested in social media. So, last spring, the Rancho Cordova, Calif.-based company issued a broadly worded RFP to a hodgepodge of five digital agencies and public relations shops. In the end, VSP decided to split the difference and pick PR company Lewis and digital creative agency EVB, which together created a campaign, launching this week, that includes blogger outreach and a viral campaign site using Facebook Connect.<br clear="none" /> <br clear="none" /> "We found that different suppliers brought different things to the table, but there wasn't one agency or partner that satisfied all our needs," said Stellmacher. <br clear="none" /> <br clear="none" /> VSP's experience is indicative of the gray area that social media -- like the Web and the rise of paid search before it -- has created in the industry. Agencies of all stripes are retooling to fill the void in one of the hottest growth areas in an otherwise dour marketing landscape, leading to unusual situations like the VSP pitch that pitted PR shops against digital agencies as they contest which will lead social media efforts for brands.<br clear="none" /> <br clear="none" /> "It's like this gigantic Venn diagram where you can't make out the circles anymore," said Ian Schafer, CEO of Deep Focus.<br clear="none" /> <br clear="none" /> The amorphous nature of social media is sowing the confusion. For a brand like Comcast, social media can amount to an extension of customer service, most notably its well-chronicled use of Twitter. For consumer brands like Pepsi and Coke, social media is an engagement tool to be utilized within advertising. For still other brands, social media can mean finding advocates to promote the company, which falls in the realm of corporate communications.<br clear="none" /> <br clear="none" /> The problem is this cuts across the org chart at brands, which typically divide roles into functional specialties. That structure is mirrored on the agency side -- and is holding back companies from adopting social media.<br clear="none" /> <br clear="none" /> "Most organizations and agency structures organize around their own business model rather than what will allow the marketers to be the most successful in social media," said Bryan Wiener, CEO of New York digital shop 360i.<br clear="none" /> <br clear="none" /> For smaller digital shops, social media is a growth opportunity. Unlike larger agencies dependent on big-scale engagements, boutiques can take on the smaller scale assignments that predominate social media. After a slow first half of the year, Poke New York is getting more assignments that amount to consulting work, according to partners Tom Ajello and Michael Kantrow. For last week's unveiling of Dyson's bladeless desk fan, Poke was involved in helping the brand set its social media strategy, but stopped short of producing work.<br clear="none" /> <br clear="none" /> Increasingly, Ajello said, clients want to keep social media execution in-house, providing a need for shops like Poke to give them the expertise to do so. "We have our hands dirtier and in more pots, but more as a consultant," he said. "We're seeing less and less often we'll execute any one thing."<br clear="none" /> <br clear="none" /> That's led some agencies to reorient the type of accounts they pursue. Deep Focus, a digital shop, was primarily an online promotions agency that worked heavily in the entertainment industry. Its social media chops is leading it in a different direction, according to Schafer, as about eight clients are using it as an "engagement agency." It recently was put on Microsoft's roster, for instance, to serve as social media agency for Bing.<br clear="none" /> <br clear="none" /> "Clients are waking up to the fact that either their lead traditional agency doesn't get social media or gets [it] enough to be dangerous, but not enough to be effective," said Schafer. "They know it's important, but that's not where they'll make their money."<br clear="none" /> <br clear="none" /> That's led Deep Focus into competition with upstart social media consulting firms. "There's a hodgepodge of firms who can deliver elements, but ... most are really new, young and underdeveloped," he said.<br clear="none" /> <br clear="none" /> EVB finds its competitive set shifting as it uses social media to provide the "pixie dust" that gets people talking about a brand. What often happens, said CEO Daniel Stein, is clients know they want to do something in social media, but aren't sure what. That puts the shop in a different position in pitches like the one for VSP. "The client doesn't even know who to call with some of this stuff," he said. "You used to know what the [competition] would bring in. Now you have no idea."<br clear="none" /> <br clear="none" /> The landscape will only get more confused as marketers shift budgets, agency executives say. Many of 360i's clients are shifting money out of bought media and into earned media, said Wiener. That's led the agency to build out from its core search-marketing specialty and into social media, which has gone from 5 percent of the shop's business to 20 percent in a year. (360i does social media work for brands like Coke and Reckitt Benckiser.)<br clear="none" /> <br clear="none" /> "There's a lot of dislocation happening," Wiener said. "The media agency doesn't want to lose the budget, so they're building stuff. The creative agency doesn't have the PR and media folks. PR firms are good at planning traditional earned media, but they most likely don't have the people in-house to build the experiences."<br clear="none" /> <br clear="none" /> <a href="http://www.adweek.com" target="_blank">— Nielsen Business Media</a>