drinking and thinking, the birth of the micro agency

I remember when Sam Adams beer came on the market. It was the first time i had ever heard the term "micro-brewery". They didn't mass produce generic beers. They concentrated on a particular style seeking a niche market. These small businesses recognized the needs of the changing beer drinking consumer.

Over the last decade micro-breweries have become increasingly popular with seemingly every region of the country having several. Portland, Oregon alone has 30. Little by little these micro-breweries have collectively eaten into the market share of the major brewers. What was initially considered a minor irritation is now viewed as a legitimate threat. 

In the last year, we have seen a similar trend in advertising. Let's call it the beginnings of the micro-agency. These are small think tanks formed by some of the top creatives in the industry. To name a few, there is Switzerland, Division of Labor and Orphan. And, these are the ones I'm familiar with. At the moment, I don't see them as threats to the big agencies but they could very quickly be viewed as ones.

These upstarts shouldn't be confused with the boutique agencies. The difference being the goal of these creative collectives is not to become an agency of record. Their interest lies in developing a per project advertising model. As a small elite group they believe there is a need to provide creative branding solutions across every platform. They can do it quicker and more efficiently then the traditional agency model. They can also do it cheaper without sacrificing the quality of the work. Arguably the work may be better. 

Economically, the micro-agencies are work for hire. It may be a broadcast TV commercials or developing a video game or a multi-media 360 campaign. They charge only for the work contracted. No retainers. No overhead costs. No money off the top to holding companies. Their value is placed solely on their individual talents and the product they deliver. As an added bonus to the client, the majority of the funds goes toward the end product. In other words, micro-agencies are adopting a model reflective of production companies. 

In it's infancy it appears as if they are working within traditional shops being hired to help pitch new accounts or problem solve on existing ones. A few of the micro-agencies I've spoken to are looking to collaborate more closely with production companies combining their branding and ideation skills with executional expertise. It makes them more formidable in attracting business. This concept has lots of potential. They're no longer competing agendas. Creative and production are collaborating from the onset. It's a flexible model that can react quickly without the burden of overhead and hierarchy. It is a model built to go direct to client void of the pressure to hold on to the account. The mantra is "just deliver". And if so, you'll eventually be asked back. 

As much as I believe this is may be a viable future model, I also don't believe it will entirely replace big agencies. There are many functions only an AOR with an existing infrastructure can service. At the same time, I also believe the only way to keep pace with the ever evolving ways consumers interact with brands is through a more nimble and flexible approach. There is a need for both models although one needs to grow and build case studies while the other needs to contract and adapt. 

Every grocery store and bar needs to have the Miller Lites and the Sierra Nevadas of the world. It better services the distributors and the consumers. Maybe brands in the future will need to have AOR's as well as a reliable group of micro-agencies. For client it may be a very attractive offer..."Tastes great. Less filling."