The little agencies attracting big dollars

The trade body representing independent media agencies now numbers close to 180 and its members are luring big-spending advertisers away from global media agency groups.

IMAA chief executive Sam Buchanan and chairwoman Jacquie Alley.

Independent media agencies are capturing a growing slice of the advertising market, as big brands look for faster reactions to their marketing challenges.

Trade body Independent Media Agencies Australia marked its five-year anniversary last week, with membership having grown from 20 at the its outset, to 180.

“We thought if we could get to 80 members we would be very happy,” IMAA chief executive Sam Buchanan told The Australian.

The indie media agencies are now responsible for as much as 30-40 per cent of total ad expenditure in Australia.

The size of the ad market in Australia varies depending on who measures it and what is included.

GroupM’s end of 2024 forecast said this year Australia could see $28bn invested in advertising in 2025 after factoring in an expected 3.7 per cent growth.

Mr Buchanan and IMAA chairwoman Jacquie Alley reckons the indie share of digital ad expenditure is over 50 per cent, and its share of total ad expenditure is now over 30 per cent.

About 25 per cent of their membership report billings of $30m or more, meaning all those agencies have earnings in excess of $3m.

Advertisers have certainly taken notice of the growing force, signing up as partners to the trade body to ensure they secure a share of that ad spend. In addition to being IMAA chair, Ms Alley is chief executive of one of the bigger indies, The Media Store (TMS).

“We’ve created an amazing community that I’ve never seen anything like,” she said.

“At industry functions all the indies get together and chat about the common stuff we’re all dealing with.

“I don’t see that happening in many other sectors.

“There’s a beautiful camaraderie and community where we’ve been able to facilitate many things that have helped member’s bottom lines.”

Ms Alley described the response from clients when they see what an indie can bring to the table. “We are so emotionally invested because it’s our business. There’s a care factor that you just can’t explain until you’re in the room with a client and they go, ‘Oh my gosh — they just care more than I’ve ever seen’.”

Mr Buchanan recalled how once having an indie media agency in a pitch for a large client was a rarity. “Indies are no longer the wildcard in a pitch or one you throw in because someone’s cousin works there. We are a must-have hot ticket on a pitch list.”

As to brands making the move from bigger agencies to indies, Ms Alley noted some of those companies might only give part of the business to a smaller agency, not all of it.

Those treading the indie path include automotive brands Honda, KIA, Volkswagen and Suzuki. TMS has had a relationship with Toyota for 24 years.

Other brands with indies include Lululemon, The Iconic and Afterpay.

One observer noting the indie surge has been News Corp Australia’s MD sales Louise Barrett.

“Many of the clients who move like the level of service they get from a smaller agency,” she told The Australian. “They are leaning in when it comes to things like integration and programmatic deals.

“Because there are senior people running those indie agencies, they are able to foster strong relationships with the clients and the clients like it.”

Half Dome is a fast-growing indie, picking off a number of clients who have moved from international groups.

One of them is The Good Guys. The electrical retailer moved to Half Dome after 13 years with Dentsu. The relationship with an indie must be working out, as The Good Guys’ parent, JB Hi-Fi, is now with an another, Nunn Media.

Half Dome co-founder Will Harms told The Australian other recent wins include NBN and training business Online Education Services

“There’s quite a big pitch underway now that’s made up equally of holding co-agencies and indies,” said Mr Harms. “We’ve got an ability to experiment because we’ve got a higher risk tolerance.”