rz gartner reprint

4/20/2016 Gartner Reprint

http://www.gartner.com/doc/reprints?id=131OP1B3&ct=160322&st=sb 1/31

LICENSED FORDISTRIBUTION

(http://www.gartner.com/home)

Magic Quadrant for Global Digital Marketing Agencies22 March 2016 | ID:G00273473

Analyst(s): Jay Wilson, Martin Kihn, Jennifer Polk, Simon J. Yates

SummaryAs marketing leaders are handed more responsibility — for transformative businessstrategies, differentiated customer experiences and revenue generation — they often seekagency support in achieving their goals.

Market Definition/DescriptionThis document was revised on 24 March 2016. The document you are viewing is thecorrected version. For more information, see the Corrections

(http://www.gartner.com/technology/about/policies/current_corrections.jsp) page ongartner.com.

This Magic Quadrant focuses on global digital marketing agencies that are strategically andcreatively led.

The definition of a global digital marketing agency has become amorphous. The "digital"qualifier has fallen away — digital marketing is now marketing in a digital world. In this world,traditional agencies with "Madison Avenue pedigrees" compete with technology providers andmanagement consultants to become the chief marketing officer's (CMO's) most-trustedstrategic advisor and tactical executioner.

For this year's Magic Quadrant, we looked at firms that focus on strategizing, creating,executing and measuring customer‐facing digital experiences across the customer journey.For consideration, providers needed to demonstrate an ability to deliver comprehensivestrategic services, creative and content services, technology implementation, measurement,and analytics — and a close alignment with the marketing needs of global brands, whoseleaders seek those specific competencies when choosing a marketing service partner.

Magic QuadrantFigure 1. Magic Quadrant for Global Digital Marketing Agencies

http://www.gartner.com/home

http://www.gartner.com/technology/about/policies/current_corrections.jsp



Source: Gartner (March 2016)

Vendor Strengths and Cautions

Accenture Interactive

Accenture Interactive is a Visionary with continued impressive growth. It participates in manyof the same pitches as Leaders in this evaluation, and it continues to build its capabilities,particularly in digital commerce and customer experience — two areas experiencing highdemand. Accenture Interactive counts UBS, Meliá Hotels International and Celebrity Cruisesas key clients.

STRENGTHS



Digital commerce: Accenture Interactive earns a significant portion of its revenue fromdigital commerce initiatives, forging strong relationships with partners such as SAP Hybris,which named it Global Partner of the Year for two years running. Additional investments,like the acquisition of European commerce firm Brightstep in 2015, add to AccentureInteractive's capabilities.

Large-scale, long-term client relationships: With multiyear, multimillion dollar contractsstrengthened by C-level client relationships, Accenture Interactive's engagements tend to belong term and strategically focused. As such, it's less prone to the cyclical churn of clientsthat characterizes much of the marketing service landscape, enabling investment in people,process and technology — a traditional weak spot for many agencies.

Collaboration: Clients laud Accenture Interactive for its collaborative ability to addressbusiness challenges and assimilate into client culture — no small task for a firm with strongconsulting roots. While Accenture Interactive's processes are viewed as rigid, its staff winspraise for ensuring that processes work within the context of a client's organization. Clientssurveyed indicate that this collaborative approach — apparent during the pitch process —continues through to delivery.

CAUTIONS

Consistent staffing and quality assurance: Some clients surveyed for this researchreported inconsistent quality of staffing and issues with quality assurance that requiredattention.

Creative services: Accenture Interactive's creative capabilities are growing but aren't yetviewed by clients as on par with market Leaders. It has yet to win significant industryrecognition for creative leadership — most of its awards are for technology successes.

AKQA

AKQA (part of WPP) remains a Leader. The firm is known for innovative digital brandexperiences and multichannel marketing campaigns, particularly for automotive, travel andretail clients. Campaigns are fueled by AKQA's creative leadership, content strategy andprogrammatic media capabilities. While AKQA offers traditional and digital marketingservices, the agency now focuses as much on upstream services, like experience design andbusiness transformation. With the 2015 acquisition of H-Art in Italy and a new office inGothenburg, Sweden, the firm's global footprint is growing.

STRENGTHS

Experience design: AKQA is adept at experience design initiatives that fundamentallychange how customers engage with brands. For example, it created IDx for Nissan,enabling consumers to configure cars using Oculus Rift goggles. The firm also created anacclaimed Dyson 360 Eye brand experience featuring a mobile application and connectionto the Internet of Things (IoT).



Business transformation: AKQA leads "Ignition" sessions with clients, bridging the gapbetween marketing and technology to create platforms for growth. One example was theF1 Access platform for Formula One, a subscription-based service for racing superfans,allowing them to view real-time data on the driver and car performance during races, whichgenerated a new revenue stream for the brand.

Expanded data analytics: AKQA grew its data and analytics capabilities in 2015, addingskilled staff and creating personalized, data-driven storytelling to boost campaign resultsfor clients like Nike.

CAUTIONS

Global reach: Global revenue is concentrated in North America and Western Europe. WhileAKQA has a global presence, its financial results don't show significant revenue or growth inkey regions, such as Asia/Pacific.

Turning data analysis into insight: Client references cite issues with AKQA's analytics andinsights. While AKQA has added talent and tools, clients struggle with strategic oversightaround back-end reporting, as well as its articulation of data insights and analysis.

Cognizant

Cognizant is a new entrant and a Niche Player. Cognizant has growing marketing capabilitiesin all industries, and it is very strong in financial services and healthcare, which account forthe majority of its 2015 revenue. In 2014, Cognizant acquired several agencies that deepenedits expertise and client roster. These agencies include Cadient, a digital marketing agencyserving the healthcare industry; TriZetto, a healthcare software company; and Odecee, atechnology company in the Australia/New Zealand region with expertise and clients in thefinancial services, insurance, healthcare, logistics and communications industries.

STRENGTHS

Advanced analytic capabilities: Cognizant adroitly implements advanced analytics toinform brand experience design, and develops Web and mobile apps to enable digitalcommerce and transform business strategy.

Industry-specific technology: Cognizant leads with innovations that can be applied acrossmultiple industries, including personalization (HealthActivate and targetSERV), experientialmarketing (Immerse), and an insights and analytics platform (Reveal).

Expert client service: Cognizant's clients cite the firm's proactive thinking, responsiveness,flexibility and integration — both internally and with client teams — which is especiallyimportant as digital marketing engagements grow in complexity and expand into otherparts of the business.

CAUTIONS



Lacking creative leadership: Cognizant has a data-intensive approach to solvingchallenges and a background in technology, backed by continued focus on hiringcandidates with IT experience. However, it lacks creative leadership relative to competitors.

Prescribed mindset: Clients cite Cognizant as "doing what was requested." While thisapproach may work within conservative industries like healthcare and financial services,marketing leaders increasingly expect an agency to challenge their thinking.

Deloitte Digital

Deloitte Digital is a Challenger this year. Building on its data and analytics expertise — and ahighly integrated relationship with Deloitte's other capabilities — the firm continues to grow.New customer acquisition was strong in 2015, with more than 100 client additions to analready healthy roster that includes Pepsi and Toyota. With a staff of more than 6,300,Deloitte Digital also acquired several firms in 2015: Swedish agency Mobiento helpedestablish an operational beachhead in the Nordic region, LRA Worldwide provided customerexperience measurement, and Stratosfera and Digital One in Poland opened markets inEastern Europe.

STRENGTHS

Business transformation expertise: Deloitte Digital's references laud the agency's ability tooffer specific strategic, technical and business transformation expertise across a widerange of industries. The firm has a huge base of business consulting clients to provideinsight into the business and marketing transformation needs of the market.

Quantitative rigor: Deloitte Digital is well-known for its expertise in marketing analytics,media mix and attribution modeling. Deloitte Digital's clients note increasing capabilities incustomer experience, digital commerce, and multichannel marketing built on analytical andresults-oriented methodologies.

Partner relationships and recognition: With such a diverse and distributed client base,Deloitte Digital requires deep and broad technology partnerships. The firm boasts a stronglist of platform partners like Adobe, Google, Oracle and SAP — along with analytics-basedpartners like Medallia and Nielsen, and innovation partners like Singularity University.

CAUTIONS

Creative credentials: Although Deloitte Digital reports that it has made some key hires andinvestments in the past year to fortify its creative capabilities, it continues to competehead-on with Leaders with stronger and more frequent competitive mentions. Referenceclients submitted by all agencies report considering Deloitte Digital only about one-third asoften as Leaders for creatively led agency engagements .

Consulting-based culture: Building on its business consulting and system integrationlegacy, Deloitte Digital excels in applying repeatable methodologies to projects — which is astrength and a challenge. Clients report challenges with global communication and



coordination, as well as with moving resources across projects .

DigitasLBi

DigitasLBi (part of Publicis Groupe) moves into the Leaders quadrant for the first time bysupplementing its data-driven rigor with renewed strategic and creative heft. As competitorsstep up their strategic consulting capabilities, DigitasLBi is keeping pace with its vision of"Networked Brands," its channel-agnostic approach to building meaningful customerexperiences.

STRENGTHS

Networked Brands: DigitasLBi pioneered data-driven targeting and measurement before itwas in vogue, but it lacked the vision or capability to transform brands. Throughinvestments in talent and strategic partnerships, DigitasLBi proves it can orchestrate thoseassets to drive world-class business transformation. Its "Every Day, Care" campaign forWhirlpool embodies this approach.

Strategic partnerships: In addition to its significant investment in its proprietary IDIOMbehavioral data platform, DigitasLBi has strong relationships with technology partners likeOracle, Adobe and SAP Hybris; data and analytics partners like Rentrak, xAd and comScore;and content publishers like Vice and BuzzFeed. It continues to focus on diversity andinclusion partnerships with the likes of Girls Who Code and The 3% Conference.

Media savvy: While many digital agencies rely on network partners for media planning andbuying, DigitasLBi keeps that expertise in-house, resulting in four Adweek Media Plan OfThe Year honors for its Taco Bell and American Express work.

CAUTIONS

Ability to execute: DigitasLBi historically takes on complex marketing challenges as a leadagency. As its vision expands, the Ability to Execute on that vision is met with mixedreviews by clients. While clients rank DigitasLBi second only to SapientNitro in terms of thecomplexity of challenges it takes on, its Ability to Execute solutions against thosechallenges is viewed as inconsistent.

Creative: DigitasLBi is viewed by some clients as more strategically focused and data-focused, which may impede creative excellence. Indeed, DigitasLBi ranks significantly lowerthan its peers in the Leaders quadrant in terms of creativity.

FCB

FCB (formerly Draftfcb) is a Challenger. FCB has a background in consumer advertising andbehavioral data-driven marketing. It continues to focus on delivering brand strategy, contentand execution to both drive behavior change and impact client business.

STRENGTHS



Global investments: FCB is investing in its business across global markets. It appointed anew management team to FCB Greater China, and it continues to improve its creativeproducts in the Indian market. FCB also recently rebranded FCB South Africa to FCB Africato expand business beyond South Africa's borders.

Shopper engagement services: FCB has a legacy in services like shopper marketing, and itis extending its capabilities to design and execute experiences that engage shoppersacross online and offline touchpoints. This is increasingly important to the retailer andother industries that maintain a physical presence.

New business wins: With several major wins in the last year, including the global accountfor Levi's and BMW in the U.K. (which left a creative agency relationship dating back nearly40 years), FCB is proving its mettle. It's also leveraging its network, winning Bank ofMontreal in Toronto through the partnership between its Montreal and Chicago offices, aswell as winning the Volkswagen business in Shanghai.

CAUTIONS

Service integration: Clients are demanding tighter integration of FCB's offerings, which ledFCB Toronto to combine its digital and brand teams into one strategy department, andcould lead to reorganization in other FCB offices to address client demands.

Digital transformation: FCB is lesser-known for business strategy, digital transformation oruser experience design — service offerings that competitors are focusing on and thatmarketers are increasingly expecting from their agencies.

Havas Worldwide

Havas Worldwide, a Niche Player, is a global agency network with about 11,000 employees in75 countries. Clients include Durex, Air France and TD Ameritrade, which came onboard toleverage Havas Worldwide's customer experience expertise. The agency focused onmanagement, creative and innovation hires in 2015, and continues to work to strengthen thecohesion of its network.

STRENGTHS

Global scale: Havas Worldwide boasts a strong global network, and it continues to invest ininternational leadership for its management and creative teams, particularly in Europe andAsia/Pacific. It launched a specialist digital unit, Ecselis, in the U.K. to forge tighter bondsamong media, data and creative.

Strategy and integration: In selecting Havas Worldwide as its agency of record in 2016,Moen cited Havas Worldwide's strategic insights and ability to assimilate to its culture.

Account management: Client references mention the agency's hands-on accountmanagement as a differentiator.

CAUTIONS



Brand recognition and cohesion: Despite Havas Worldwide's size and scale, clients rarelymention it as being among their agency consideration set. Its global network may sufferfrom historically siloed units that lack strong brand connection with the larger organization.

Culture and creativity : Havas Worldwide recognizes its recent weaknesses in creativeinnovation and leadership, which are at least partially due to its networked operating model.According to CEO Andrew Benett, the agency is addressing this by creating 35 "HavasVillages" across the network to bring together its various disciplines in one location andimprove collaboration.

IBM Interactive Experience

IBM Interactive Experience (IBM iX) is a Leader, with more than 10,000 staff worldwide. It wasrecognized by Advertising Age (Ad Age) as the world's largest digital agency network in 2015.IBM's global footprint, sector-specific technology expertise and Design Thinking approach tocustomer-centric marketing make IBM iX a formidable competitor to more traditionalagencies that it meets during the pitch process.

STRENGTHS

Customer-first approach: IBM iX delivers solutions to CMOs who are increasingly taskedwith differentiating their products through improved customer experience. The DesignThinking approach starts with the customer and comes to life through experiences thatsolve problems for customers while driving business results. Its partnership with theAtlanta Falcons to transform the fans' experiences at the new Atlanta stadium (scheduledto open in 2017) should be of interest to entertainment and retail brands.

Digital commerce and emerging technologies: With long-standing expertise in digitalcommerce, IBM iX focuses strongly on advanced marketing organizations. IBM Watson'scognitive capabilities are increasingly relevant to marketers that want to understand andpredict consumer behavior, and IBM's ongoing acquisitions of software providers likeStrongLoop foresee the impact of IoT on IBM iX's marketing clients.

Creative momentum: Through strategic hires, IBM iX is improving client perceptions of itscreative capabilities, which we noted as a Caution in the previous year's Magic Quadrant.IBM iX has recently acquired three independent agencies noted for their creativecapabilities. Client references rank creative highly at IBM iX, eclipsing some agenciestraditionally viewed as creative strongholds.

CAUTIONS

Cost of service: Although IBM iX offers a range of pricing alternatives and serves a broadrange of clients of various sizes, segments and industries, its services are primarily pricedand structured for large-enterprise clients. Even clients with large budgets noted the needto justify the premium price point internally.



Technology partnerships: Because of IBM iX's roots in technology, clients have historicallynoted that the agency is quick to recommend IBM technology solutions. However, IBM iXdemonstrates that it is rapidly adding to its roster of technology partnerships in an effort tooffer clients the right solution based on their needs.

iCrossing

iCrossing (part of Hearst) is a Leader with expertise in performance media, along with agrowing presence in user experience design, technology development and advancedanalytics. It maintains a mission of "unleashing potential," with an emphasis on engagementthrough the use of data, design, content and technology. iCrossing notably offers aproprietary "strategy, development and activation framework" under the metaphor of "BrandOS." Many of its deepest client relationships, including LG and Toyota, focus on technologyservices; iCrossing provides consultative technical strategy, development andimplementation, in addition to creative services.

STRENGTHS

Specialized technologies: iCrossing built its own in-house version of a data managementplatform for marketing and advertising, called the "Starscape Data Platform." This givesclients access to a managed tool for data integration and audience discovery, as well asintegrations with execution partners, such as Facebook Exchange and Lotame. (However,clients should demand flexible deployment and contract terms to avoid lock-in.)

Performance marketing prowess: With its roots as a leading search engine marketingshop, iCrossing takes a results-oriented approach to marketing and advertising programsthat resonate with performance marketers.

Content-driven customer engagement: As part of a content and media company, iCrossinghas greater depth and facility than competitors in the creation of compelling, shareablecontent for clients such as TD Bank and Avon.

CAUTIONS

Creative and strategic services: Although delivering interesting creative ideas for clients,such as Voya's "Born to Save" campaign, iCrossing is not noted for its above-the-line brand-building expertise. Clients give it relatively lower scores for creative and strategic services,indicating it has work to do to be seen as a go-to partner for breakthrough ideas.

Media ties: Although integrated with media providers outside of Hearst, iCrossing naturallytouts its parent as a benefit, particularly its use of proprietary data from 300 million userson Hearst's global digital properties. On the other hand, tight ties between media buyingand selling agents always raise the potential for conflicts, which clients should scrutinize.

Isobar



Isobar (part of Dentsu) is a Leader. Having overcome the challenges it faced during itsnetwork's consolidation of digital units, Isobar now delivers a unified brand and service to itsclients. As a function of its more than 70 local offices, Isobar services a larger percentage ofsmaller and midsize businesses, along with Fortune 500 clients, than do many of itscompetitors.

STRENGTHS

Global reach, and diverse services and customers: Headquartered in London, Isobar'sglobal footprint is impressive, with revenue balanced across North America (25%), LatinAmerica (13%), EMEA (32%) and Asia/Pacific (30%). Marketers engage Isobar nearlyequally for strategy, creative, technology, media (in Brazil and China), campaignmanagement and digital commerce.

Client satisfaction: Nearly across the board — from strategy through creative, data andanalytics — Isobar's clients ranked the agency highly. Clients lauded Isobar's transparency,flexibility and organizational listening skills, which seem to permeate from managementdown to the front lines. Isobar's 95% client retention rate reflects those strengths.

Innovation: With a solid network of partnerships, including Adobe, Amazon, SAP Hybris andDemandware, Isobar wins client kudos for its technical expertise, without sacrificingcreativity. It serves as the digital agency of record with Lego, a marketing innovationexemplar, in the U.S. Isobar's development of the Chevrolet CoDriver virtual reality programis indicative of the agency's innovative approach.

CAUTIONS

Ability to adapt: Isobar is agile and fast-moving, and it has developed rigorous processes toscale its program execution. Clients mentioned challenges in Isobar's ability to work withinternal resources and client partner companies that move at a different pace or thatadhere to different processes.

Brand recognition: Perhaps because it targets clients beyond the CMO organization, oftenselling straight into the CEO and CIO roles, Isobar is less frequently mentioned by itscompetitors as a threat, and it isn't frequently mentioned by those competitors' clients aspart of their consideration set.

Mirum

Mirum, part of the J. Walter Thompson Company (JWT), enters the Magic Quadrant this yearas a Visionary. It boasts a sizable staff of 1,880 dedicated to digital marketing businessservices across North America, Latin America, Western Europe and Asia/Pacific. Mirum'sservices focus on business transformation, marketing innovation and commerce — what itcalls "the intersection of creative and technology." The firm has an impressive client list andlong-standing relationships, including HSBC, Qualcomm and MasterCard, as well as newercustomers, such as Asus, Dubai Tourism, and Johnson & Johnson.

STRENGTHS



STRENGTHSCustomer experience (CX) and user experience (UX) design expertise: Customerreferences cite CX and UX design skills — and deep development and technology expertise— as reasons for using Mirum. The firm's technology expertise is supported by strongcreative and digital commerce capabilities that appeal to brands delivering digitalexperiences into local markets.

Innovation leadership: Combined creative and technical skills allow Mirum and its clientsto push the marketing innovation envelope. Examples include insurer Manulife'sManulifeMOVE program (customers wear fitness trackers and synchronize them with theManulifeMOVE mobile app to be rewarded for healthy living choices); and Soundcheck, anoriginal content platform partnership between Walmart and Unilever.

Speed and consistent quality: Mirum's references point to the firm's speed and consistentquality. With its sizable staff, Mirum can dedicate resources to get projects done right andon time.

CAUTIONS

The challenge of scale: Despite Mirum's large staff, the technical and creative talentrequired to sustain a cutting-edge image is hard to find and expensive to retain. The agencycontinues to expand globally by building and extending current client relationships, whichmay impede other firms' ability to buy its services.

Narrow focus: Mirum's clients look for specific, creative project engagements that drivepurchase. As such, the firm risks being labeled as a "specialist" agency and missing out onopportunities to grow its business in more mainstream projects.

MRM//McCann

MRM//McCann, a Challenger, has more than 3,200 employees worldwide (almost 2,000 areoutside of North America). That said, the company reports that North American businessrepresents about 60% of its revenue. MRM//McCann focuses on "creating connectedexperiences throughout the customer journey," attracting clients seeking digital models thatuse customer experience and the empowered consumer as central themes. Recentacquisitions include e-commerce service/solution provider Optaros, enabling MRM//McCannto connect clients' customer experiences with digital commerce transactions.

STRENGTHS

Data and creative: Clients laud MRM//McCann's commitment to measurementmethodology. This year, clients also note the firm's top creative talent — an improvementfrom their feedback last year. All clients surveyed plan to maintain or increase theirinvestment in MRM//McCann in 2016.

Customer centricity: Clients appreciate MRM//McCann's process of unearthing the contextof customer journeys, which helps define successful "moments that matter." Together withthe firm's focus on measurement and innovation, this process consistently delivers



customer-centric marketing.

Production capacity: MRM//McCann is an integrated global agency with offices throughoutthe Americas, Europe and Asia/Pacific, including two offshore digital production facilities.The MRM//McCann Buenos Aires digital production center boasts 300 skilled staff and fullintegration within the MRM//McCann global network. In Bucharest, Romania,MRM//McCann has more than 100 staff dedicated to software development and qualityassurance.

CAUTIONS

Staffing imbalance: In Asia/Pacific, a staff of 600 (18% of the total) generates only 8% ofthe revenue. Whether MRM//McCann is forward-investing in a stronger Asia/Pacificpresence — or simply generates more revenue from fewer staff in North America —potential clients should look closely at staffing allocations to ensure consistent delivery ofservices.

Creative talent and edge: As noted earlier, references were impressed with improvementsin MRM//McCann's talent and creative edge, but the perception persists that the agency stilllags with regard to design and creative talent when compared with category Leaders andthose with whom it competes for business.

OgilvyOne Worldwide

OgilvyOne Worldwide (formerly profiled as Ogilvy & Mather, part of WPP) moves into theLeaders quadrant this year; it was the only traditional marketing firm to do so. The agency issuccessfully evolving its products and services to keep pace with market demands, includingmaking significant investments acquiring technology service providers and expanding itsglobal footprint. Client relationships show the breadth and depth of OgilvyOne Worldwide'scapabilities, from its work with Kimberly-Clark on global digital marketing and digital businesstransformation, to engagements with Famous Footwear, analyzing the customer journey touncover loyalty and revenue opportunities.

STRENGTHS

Technology investments: Not only did OgilvyOne hire a new CTO, the agency also madeseveral strategic acquisitions: Verticurl, a marketing automation provider; Bottle Rocket, amobile application developer; and PennyWise Solutions, an India-based Web developer.OgilvyOne Worldwide also formed H&O, an in-house digital production company.

Increased global capabilities: OgilvyOne expanded its footprint in Africa, Brazil and theMiddle East. The agency also diversified financial results, showing that North Americarepresents just 45% of its 2014 digital marketing revenue. Its work with Nestlé, where it has29 market assignments as lead agency, is indicative of this strength.



Proprietary processes: OgilvyOne's planning tool (Data-inspired, Always-On, ValuableExperiences [DAVE]) offers improved service delivery for designing digital experiencesusing data and analytics — from planning through measurement and optimization.

CAUTIONS

Innovation and design: OgilvyOne faces competition from agencies pushing hard intoinnovation and technological leadership. Clients rarely report innovation, design ordevelopment as reasons for choosing OgilvyOne.

Changing organizational structure: While 90% of OgilvyOne's business is digital, includingits fully integrated Neo@Ogilvy unit, it also taps into other business units, such asDigital@Ogilvy, which have their own digital expertise and support other parts of WPP.

Possible

Possible (part of WPP) is a digitally focused Niche Player with about 1,500 staffers in 23global locations. Possible positions itself as a nimble alternative player in the market. Keyareas of depth include content marketing, mobile design, content management and digitalcommerce services. Possible is a certified Amazon creative and technology consultingpartner. The agency made several high-level and specialist hires in 2015 that demonstrate itscommitment to global growth. Notable clients include Starbucks, St-Germain ("Vive theDaylife") and Burt's Bees.

STRENGTHS

Customer experience design: Possible continues to build out well-regarded digital designcapabilities. It offers design services for apps and digital experiences, including productsand services. A standout example is JetBlue's popular mobile app.

Content marketing: Possible's content creation and social marketing engagements grewthis past year. It partnered with Mindshare to launch Content+, an integrated platform todistribute snippets of text and images it calls "microcontent." Innovative executions includea campaign for Microsoft's OneNote that invited millennial co-creators to share successstories.

Global presence: Based in Seattle, Possible's organizational structure allows it to allocatesenior and specialized talent across geographies to adapt to client needs. Clients give theagency high scores for its flexibility and willingness to collaborate.

CAUTIONS

Limited awareness: Although no longer a new brand, Possible faces challengesestablishing itself within a competitive landscape. Its ongoing project is to maintainmomentum while gaining more breakthrough cross-channel client success stories.

Executional Focus: Possible's public posture has evolved from competing with Leaders to anarrower position as a nimble Niche Player. This approach means Possible is seen as anexecutional rather than strategic partner, and client references give the agency lower



relative scores for strategic services.

PwC Digital Services

PwC Digital Services is a Challenger appearing in the Magic Quadrant for the first time,following a 2014 reorganization that combined multiple previously acquired entitiesrebranded as PwC Digital Services. The resulting entity combines the marketing expertise of adigital agency with the business transformation and industry expertise of a consulting firm.Having made six agency acquisitions in the previous seven years, PwC made three moreacquisitions in 2015 to support the digital marketing services business: iBROWS, Nealite andCinovate.

STRENGTHS

Ability to leverage existing C-level relationships from a large installed base of businessconsulting clients: PwC generates more than $34 billion a year in revenue and has officesin 157 countries. Many of its clients have invested in business transformation initiatives.PwC Digital Services has the ability to leverage these relationships to sell digital services.

Process and delivery expertise: Clients acknowledged PwC Digital Services' sales processand solutions in delivering complex digital experiences. This is an important capability inthe market, as clients move beyond traditional marketing communications projects to morecomplex initiatives that cross channels and customer experiences. References cited thefirm's ability to understand and effectively scope project needs and execution as strengths.Recent hires boost the firm's creative capabilities.

Demonstration of integrated capabilities: In 2015, PwC Digital Services opened 29Experience Centers. It has staffed the Experience Centers with more than 3,000 creative,technical and process professionals. These centers showcase the firm's integratedapproach that combines the creative work of an agency with the strategic and processexpertise of a business consultancy.

CAUTIONS

Creative limitations: Clients appreciate PwC's creative capabilities, but creative executionwasn't a core strength when compared with the Leaders. Case studies cited by PwCfocused on business process improvement as opposed to creatively innovative use casesthat define the cutting edge of customer experience and marketing. PwC's examplesfocused on using digital and mobile solutions to improve traditional processes, whileLeaders were focused on transformational redesign of customer experiences.

No focus on marketers or digital marketing: Gartner believes that digital marketing is animportant part of digital business transformation. PwC claims that it does not serve themarketer in digital service activities or projects.

Razorfish



Razorfish (part of Publicis Groupe) is a Leader. It's also one of the first agencies built to focussolely on digital, and it continues to lead the industry for its vision and Ability to Execute. Thefirm's ongoing investment in talent, technology and strong partnerships coalesces to meet itsclients' complex marketing challenges.

STRENGTHS

Vision: Razorfish recognizes the threat posed by traditional consultancies and investsheavily in its own capacities to bring a transformative vision to senior client leaders.Through a combination of talent, technology and traditional agency skill sets, like media,clients praise Razorfish for its ability to bring its visions to life and tie them to measurablebusiness results.

Risk and innovation: Clients praise Razorfish's ability to gain senior management buy-in andtake risks. The agency's work in emerging technologies is notable — including virtual realityshowroom experiences for Audi and dynamic video content for Nike. Razorfish is piloting ashopping experience called "Third Channel," and it is considering artificial intelligence (AI)technology offerings from Microsoft's Project Oxford and IBM Watson to improve one-to-one customer interactions.

Collaboration: Clients give Razorfish high marks for its collaborative approach, whichremains consistently strong from the initial pitch through consulting and execution. Theagency's ability to integrate into an organization is a core strength. Clients also praise theagency's ability to work within tight timelines with little friction.

CAUTIONS

Price: Razorfish is a premium-priced provider that may be out of the reach of manymarketers. That said, nearly 20% of its clients have less than 2,500 employees, so thelimitations are more a function of budget than company size. Indeed, well-funded, smallerdigital disrupters, like Spotify and car2go, are clients, signaling Razorfish's role as aninnovation partner for organizations of all sizes and stages of evolution.

Staffing clarity: Some clients mentioned a need for greater transparency into staffingstructures, and report challenges with obtaining consistent levels of staffing to scaleprograms.

R/GA

R/GA (part of Interpublic), a Leader, is a full-service strategic and marketing partner to CMOsfor global brands such as Nike, Samsung, Google and McCormick. R/GA is expanding itsglobal reach with offices throughout EMEA and Asia/Pacific. The agency positions itself as atrusted advisor to major brands, crafting product and experience design solutions that gobeyond promotional campaigns. In keeping with its entertainment industry roots, R/GA ismore adept than most of its competitors at executing digital-first concepts, includingtechnology development and startup incubation.

STRENGTHS



STRENGTHSCreative depth: R/GA often delivers engaging, provocative work for its clients. It'sparticularly adroit at developing and delivering digital services, such as L'Oreal's "MySignature Beauty," and creating fresh TV and video content for clients — notably, standoutBeats by Dre spots launched in late 2014.

Strategic thinking: R/GA has notable success as a strategic partner to brands focused onthe customer journey and technology innovation (it hosts a startup Accelerator program).Clients rate the agency highly for strategic services.

Execution capabilities: Only a handful of agencies have the depth of digital-first design andproduction resources offered by R/GA. The agency is capable of impressive cross-channelexecutions, including the Ad Council's "Love Has No Labels" anti-bias work, and itsconnected-device-driven cycling campaign for Equinox.

CAUTIONS

Collaboration model: Although reference clients generally praised R/GA's collaborativeapproach, some said the agency could do more to integrate with internal teams, such as IT.

Increasing competition: The agency landscape is getting increasingly crowded as well-funded competitors from adjacent categories set R/GA's home territory in their sights.

SapientNitro

SapientNitro, a Leader, was acquired by Publicis Groupe at the beginning of 2015, creating theholding company's digital-centered Publicis.Sapient platform, which also includes DigitasLBi,Razorfish and Sapient Consulting. SapientNitro is well-regarded for its innovative, strategicapproach to customer experience design, called "Storyscaping." It has the creative,technological and analytical chops to deliver efficiently against that approach through its"Agile-based" project delivery methodology.

STRENGTHS

Strategic vision: SapientNitro has marketing foresight combined with creative executionunmatched by most competitors, as demonstrated by work that is equally recognized bycreative and technology award juries. As the number of customer touchpoints, connectedchannels and marketing technologies grows, SapientNitro continues to develop andexecute increasingly complex engagements, as it did with a connected ecosystem forRegions Bank.

Innovation in analytics: The agency, recognizing the challenges that clients face inmeasuring CX investment ROI, developed a Return on Experience methodology thatunderstands physical and in-venue — not just digital — behavior by using emergingtechnologies like sensors, while investing in emotional insights analytics to betterunderstand the customer journey. Recognizing the need for companies to transform by



using service design, agility and developmental operations as core competitive advantages,the agency developed models, methods and tools to help clients like Marks & Spencer buildcompetencies in these critical areas.

Digital commerce and retail: SapientNitro has long-term, successful relationships withAdobe, Sitecore, Oracle, IBM and Demandware, and it was named "Most Innovative Partnerof the Year" by SAP Hybris. Its Connected Retail Lab envisions the store of the future,whereby a connected customer experience is fueled by emerging technologies.

CAUTIONS

Minding the fundamentals: While SapientNitro is clearly investing in innovative datatechnologies, clients rate their own satisfaction with those services lower than we wouldexpect, perhaps indicating resources are focused on what's next versus what's needed now.

Overambitious: Clients indicate that SapientNitro, at times, brings forth proposals that arebeyond the current budgetary and operational capabilities of the client organization.

VML

VML (part of the WPP) is a Niche Player with 2,500 staffers in 26 locations, including EMEAand Asia/Pacific. It focuses on three core practice areas: Strategy and Intelligence, Marketingand Advertising, and Platforms and Experiences. Major clients include Kellogg, Kimberly-Clark, Colgate, Motorola and Wendy's. The firm has enhanced its project management andinstitutional process flows to ensure consistent global delivery, and it has developed what itcalls the "Efficient Design, Graceful Execution (EDGE)" methodology, applying agiletechniques to creative experience design. One way this effort is paying off is with anincreasingly diverse portfolio of work across multiple markets.

STRENGTHS

Client engagement: Clients continue to praise VML's people for their integrity, "can-doattitude," and ability to deliver on time and within budget. The agency reports 92% retentionamong clients and gets high scores from references for "collaboration."

Growth strategy: As a somewhat less-known player in the agency "big leagues," VMLcontinues to raise its profile through global expansion and well-chosen partnerships, and byenhancing its own ability to deliver multichannel creative and technology programs.

Partnership depth: VML is adept at developing and managing meaningful strategicpartnerships across a range of disciplines, including creative, content, analytics andtechnology. Notable partners include Adobe, Acquia, Sitecore and Microsoft.

CAUTIONS

Global consistency: As VML continues to expand its global footprint, it must maintaindelivery quality and its own rigorous service standards. Clients reporting some inconsistentdelivery in 2015 point to the need for ongoing vigilance.



Challenging clients: Praised for its flexibility and collaboration, VML may at times need tohone its ability to challenge clients and press for bolder ideas. Although creativity can be atwo-way street, some clients said they wished VML would "push us harder" to innovate.

Wieden+Kennedy

Wieden+Kennedy (W+K), one of the few remaining independent agencies in this year's MagicQuadrant, remains a Visionary. W+K stands out for its continued creative leadership,combined with its ability to successfully integrate and execute traditional and digitalmarketing campaigns. While the agency has earned numerous accolades for its creative, ithas not expanded into strategic services or data and analytics with the passion or pace of itspeers.

STRENGTHS

Creative culture: W+K maintains a creative culture that produces galvanizing ideas andaward-winning advertising and marketing campaigns, such as the Nike World Cupadvertising campaign and multichannel execution.

Technology/brand utility: W+K demonstrates an ability to use technology to develop brandexperiences that support campaign executions, such as the Old Spice adventure campaign.

Flexibility: W+K builds its capabilities around "brand purpose," maintaining a flexibleoffering to meet the needs of its clients, which is increasingly important among marketingagencies.

CAUTIONS

Small global footprint: W+K lacks the global scale of competitors. It has a micro network ofglobal offices (and growing global revenue), but it lacks a presence in emerging regions likethe Middle East, Africa, and Central and Eastern Europe, where competitors are expandingtheir footprint.

Limited data capabilities: W+K's focus on data and analytics is limited to social listeningand monitoring, and campaign tracking and measurement, despite data becoming a crucialpart of marketing in a digital age. This places the firm at a clear disadvantage versuscompetitors that invest in this area.

Narrow focus: W+K is recognized more for creative, content and advertising than for CXdesign and development. As marketing's responsibility for CX increases, W+K may need toincrease investment and emphasize its capabilities in these areas.

Wunderman

Wunderman (part of WPP) remains a Challenger. The firm focuses on combining creativityand data-driven insight to develop global campaigns, content and user experiences.Wunderman serves all industries and is growing in both the B2B and B2C sectors.Wunderman's approach to delivering business transformation lies in using customer data to



inform strategy and design, more so than in technical deployments. In addition to providingtraditional and digital marketing services, Wunderman also offers CRM strategy, analysis andexecution as a service to clients like GSK and Microsoft.

STRENGTHS

Leadership investment: Wunderman is making strategic hires around the globe, bringingnew leadership and dedication to the business overall and in key regions.

Data investments: Data makes up 20% of Wunderman's revenue and fuels the agency'scapabilities across data services, data management, analytics, measurement, reporting andconsumer engagement. Wunderman also applies a data-driven approach to insight andcreative, called "Collision," through access to KBM Group data assets, data frompartnerships with other WPP agencies and companies like Apple, Twitter and Facebook fordata matching, and investment in Zipline, its data management platform.

Global scale: Clients cite Wunderman's global scale as an asset for speed ofimplementation. The recent acquisition of Phantasia (a digital marketing agency in Peru), apartnership with Conversocial in the Middle East, and a majority stake in ABS Creative inEurope extend Wunderman's worldwide offerings.

CAUTIONS

New leadership: With new North American leadership, Wunderman and its clients need tocarefully monitor consistent service delivery and execution as the team adjusts.

Lack of recognition: Despite its success, size and scale, Wunderman lacks the industryreputation and prominence of other agencies of similar size.

Vendors Added and Dropped

We review and adjust our inclusion criteria for Magic Quadrants as markets change. As aresult of these adjustments, the mix of vendors in any Magic Quadrant may change over time.A vendor's appearance in a Magic Quadrant one year and not the next does not necessarilyindicate that we have changed our opinion of that vendor. It may be a reflection of a change inthe market and, therefore, changed evaluation criteria, or of a change of focus by that vendor.

Added

Cognizant was added as a result of its increasing focus on, and revenue from, marketingservices and the strength of its global reach and technology capabilities.

PwC Digital Services is a growing digital marketing service provider, and it is increasinglymentioned as a core competitor alongside other traditional consultancies.

Mirum, part of JWT, was launched in early 2015 and brings together 11 digital units to form aglobal network of digital marketing service providers.

Dropped



Rosetta, a participant in the previous global digital marketing Magic Quadrant, is part ofRazorfish this year.

Meredith Xcelerated Marketing (MXM) was dropped from this Magic Quadrant because itsestimated revenue did not meet our inclusion criterion of $175 million.

Inclusion and Exclusion CriteriaTo be included in this Magic Quadrant, global digital marketing agencies must meet specificcriteria, of which two have been updated from the previous Magic Quadrant. First, weincreased the minimum annual global revenue to $175 million to account for the changingmarket landscape. Second, we required providers to demonstrate global capabilities in threegeographic regions (not just two), because cementing that success outside of North Americaand Europe is increasingly critical for global marketers. The criteria include the following:

Revenue: Providers in this evaluation must have a global revenue of at least $175 millionfor digital marketing services.

Core business: Providers in this evaluation are marketing agencies focused on strategizing,creating, distributing and measuring customer-facing digital experiences across thecustomer journey. They create and manage digital experiences that drive awareness,consideration, conversion and advocacy across all digital channels. As such, providersserve as lead digital agency or digital agency of record for at least three enterprise clients.

Full-service provider: Providers in this evaluation must offer the following criticalcapabilities: strategic services (business, marketing and/or brand strategy); contentdevelopment and creative services; technology implementation; and measurement andanalytics. Agencies under consideration must demonstrate a comprehensive track recorddelivering these capabilities to their clients across paid, owned and earned digital media,including website, social media, email, mobile, paid search and digital advertising channels.

Global reach: Providers in this evaluation must have a global reach. They must havedeveloped communications solutions to engage audiences in at least three global regions,with resources and staffing on the ground in those regions.

Five new clients: Providers in this evaluation must have acquired at least five new clients inthe past 12 months (which may include new engagements within a different business unitof an existing client). Client acquisition costs in this sector are high, and the ability to growbusiness in an existing account is a bellwether of success.

Evaluation Criteria

Ability to Execute



Product/Service: We looked at the strength of a provider's full-service, cross-disciplineofferings, and for seamless integration across the following core competencies: strategic andcreative services, experience design, application development (with related systemintegration skills), analytics, program management and media planning/buying services.

Overall Viability: An assessment of a provider's overall financial health or, in cases in which aprovider is a corporate subsidiary, its financial and practical success as a business unit. Welooked at a provider's overall commitment to digital marketing services, and to the likelihoodof the organization continuing to offer and invest in related products, services andtechnologies.

Sales Execution/Pricing: We evaluated a provider's capacity for global business developmentand for its ability to manage a global brand. We also assessed the provider's billing modelflexibility (for example, fixed price, time and materials [T&M], retainer, performance-based,and/or fees for equity billing). Finally, we looked for a provider's demonstrated track record ofcross-selling services for greater wallet share among major accounts.

Market Responsiveness/Record: We evaluated a provider's marketing service agility, andlooked at its history of acquisition, alliances and new hires in digital, social and mobile. Wealso looked at the provider's ability to leverage the rising demand for business strategy anddigital business transformation services.

Marketing Execution: We looked for evidence of the provider's digital thought leadership aspart of its marketing program execution. We investigated a provider's ability to deftly integratesocial, mobile and other digital marketing technologies into the larger marketing strategy.

Customer Experience: We looked for evidence of sustained client relationships and any keyclient losses in the past two to three years. We corroborated this evidence with feedbackfrom references, Gartner inquiries and other client-facing interactions, including via ourparticipation at Gartner conferences and other industry events.

Operations: We assessed how a provider staffed projects from a global pool of resources, aswell as looked at provider flexibility and client accommodation related to managing talent. Wealso looked at a provider's willingness to invest in the tools and technology required for agile,efficient management of skilled agency talent.

Table 1. Ability to Execute Evaluation Criteria

Evaluation Criteria Weighting

Product or Service High

Overall Viability High

Sales Execution/Pricing High



Market Responsiveness/Record High

Marketing Execution High

Customer Experience High

Operations High


Completeness of Vision

Market Understanding: Here we looked at a provider's strategic understanding of the fullmarketing mix driving the client's business, as evidenced by the depth of thought leadershipand strategic services across the customer journey. As disruptive technologies andcompetitors enter the market, we also looked at a provider's ability to think beyondpromotional tactics and address opportunities and challenges within traditionally siloed clientorganizations, like e-commerce and product development. Finally, we looked at a provider'sability to understand customer demands and shape (or enhance) market changes with theiradded vision.

Marketing Strategy: The provider's go-to-market strategy should align with emerging trendsand the overall direction of the market for digital agency services. We considered the vendor'sability to create and distribute clear, differentiated messaging across digital channels — andits capacity to educate the market and provide thought leadership around emerging practicesand technologies.

Sales Strategy: This criterion examines a vendor's ability to secure new client wins within thepast 12 months. This is not a volume business; profitability depends on the ability to developlong-term relationships. Hence, we looked at the provider's ability to sell and grow longer-termrelationships versus the provider's ability to score one-off wins.

Offering (Product) Strategy: Here we evaluated a provider's capability mix. We specificallyinvestigated how well this mix incorporated multidisciplinary services into an integratedoffering, from strategic services to the underlying components that drive the engagement,including creative services, technology build-outs, measurement and program management.We also asked client references about the provider's skill and ability to transition theirengagements from strategy to implementation.

Business Model: We assessed the strength of a provider's business model relative to itsfinancial engagement with clients — from T&M and fixed-price structures to performance-based agreements. Today, traditional agencies (that is, those borne from creative roots)



compete side-by-side with technology-driven system integrators. By perfecting their approachto scope and pricing, these data-focused firms force less-disciplined agencies to applygreater structure and rigor to their own client financial engagements.

Vertical/Industry Strategy: We examined the strength of a provider's investments in industryapplications of digital marketing as a means of differentiating its client's brand. We alsolooked at how a provider approached a vertical market: with a mere point of view or with acustomized offering infused with industry knowledge in its delivery.

Innovation: We reviewed a provider's ability to push clients to take risks, couched by amethodology that can put boundaries on risk through techniques such as pilots orindependent R&D efforts. We also looked at how agencies fund a portion of their own R&Dwith partners, universities or their own research labs. We did so, with the understanding thatproviders in this industry rarely have an independent R&D budget, and must often fundinnovation through billable work — leaving an agency vulnerable as new technologiesencroach into its core competencies.

Geographic Strategy: We examined a provider's operational investments beyond itsheadquarters location, in parallel with an exploration of the firm's capacity to execute globallyin a virtual world. We did so aware that providers in this market are global players; most haveyears of experience designing and implementing global brand awareness campaigns. Yet,while many providers can point to North America and Europe as driving global effortshistorically, here we looked at a provider's experience within such key nations as Brazil,Russia, India and China, as well as within emerging economies.

Table 2. Completeness of Vision Evaluation Criteria

Evaluation Criteria Weighting

Market Understanding High

Marketing Strategy Medium

Sales Strategy High

Offering (Product) Strategy High

Business Model High

Vertical/Industry Strategy High

Innovation High



Geographic Strategy High


Quadrant Descriptions

Leaders

Leaders possess deep, broad capabilities across all competencies — most notably related tostrategic services (which include business strategy and digital business transformationskills). Leaders implement comprehensive, effective solutions that leverage sizableinvestments in creative talent and marketing technology. While Leaders have attributes offast followers, they invest their own R&D dollars to set market direction. As a result, Leadersare the providers to watch in the ongoing evolution and transformation of marketing in adigital world.

Leaders maintain a viable business, regardless of the global economy. Leaders extend theirclient relationships far beyond marketing promotions, often appearing on competitive bidsoutside their primary sector (for example, management consulting, production ideation andproduct development RFQs). Leaders help their clients develop digital marketing platformsdesigned for systemic growth and scale; they do so by harnessing their own significantexpertise, implementing digital marketing programs driven by data and analytics.

Challengers

Challengers have a proven ability to execute their current offering but haven't yet executed adigital marketing vision on the scale of the Leaders. Challengers can become Leaders if theirvision develops and they implement client engagements that move the market forward. Assuch, it's not uncommon for large end-user clients to move their engagements betweenChallengers and Leaders as their needs shift from management consulting, to productideation and to promotional plan execution.

Challengers deliver exceptional work but tend toward reticence with regard to pushing clientsto take business risks (as opposed to promotional risks). Whereas Leaders aren't afraid tochallenge clients out of their comfort zone, Challengers are less likely to do so. Challengersmay have a global staffing model in progress, but it is still in need of refinement. Withstrategic services embedded typically in marketing and promotional tactics, Challengersoften lack the kind of consulting power in which the Leaders have invested, as evidenced byLeaders' recruitment of business strategists from top management consulting firms toaddress digital business transformation.

Visionaries



Visionaries align with the market's evolution but lack a proven depth and breadth of services— or a demonstrated execution of their marketing vision through deeper client engagements.Visionaries are often strong in creative services, UX, search, analytics and performance. WhileVisionaries have a robust portfolio of skills, they apply resources and talents to brand- andidentity-building, marketing promotions, advertising or public relations. Many lack thebusiness strategy expertise we find among the Leaders.

Visionaries often introduce new technology, services or business models, but without thesolid financial strength, service and support — or more sophisticated sales models andpartner/alliance programs — required for ongoing client benefit or viability. Visionaries canbecome Challengers or Leaders, provided they increase the breadth and depth of their serviceoffering beyond promotional marketing.

Niche Players

Niche Players may demonstrate proven prowess in a specific market segment, or they havelimited ability to innovate or outperform other providers. Some Niche Players focus on aparticular marketing function or geographic region; they may be choosing to maintain whatthey do well to avoid the risk-taking attributes of Visionaries and/or Leaders. Niche Playersare often new market entrants; they can also be organizations opting to focus on a core set ofofferings. Alternatively, they may be struggling to acquire clients seeking providers withleadership or visionary qualities. Niche Players, because of a more limited view of marketing,typically excel at their core competency. They have adequate functionality, limitedimplementation and support capabilities, and a relatively limited customer base comparedwith Leaders, Challengers and Visionaries.

ContextThis Magic Quadrant analyzes digital marketing agencies that compete on the global stage.Agencies were evaluated on how well they are executing their vision for digital marketingthrough client references, as well as investments in their people, methodology and R&D.

Market Overview

The Traditional Agency Model Is Broken

In 2016, CMOs are rethinking their brands' dependence on external marketing agencies. Manyaren't convinced that external firms are the right allies to take into battle, highlighting acontinued trend among CMOs to build internal marketing capabilities or even establish in-house agencies. The reason for this shift is twofold. First, CMOs want creativity as a coretenet of their own teams. In May 2015, Chobani CMO Peter McGuinness told Digiday, "Themore you outsource, the less of a creative culture you have." In October 2015, Brad Jakeman,

1

2



president of PepsiCo's global beverage group, went further, shaking the agency world with hisassertion that unless it innovates, the traditional agency model "is not going to bend, it'sgoing to break."

For their part, agencies rightly critique marketers' ineffective briefing processes and the useof the agency pitch to score spec work, which drives up costs on both sides, according to EveReiter, VP of Global Supply Management at American Express.

Indeed, the selection process greatly influences the client/agency relationship success.Marketers (not procurement alone) must invest time and effort to fully vet an agency, takingcare to clearly illuminate business goals and challenges. In doing so, the agency can properlyvet them in return. Agency selection left largely to procurement, and beholden to stringentprocess versus open conversation, neutralizes a critical element of a successful creativepartnership — the ability to challenge each other.

To help their clients compete in today's global and digital marketplace, agencies need torethink traditional models of engagement and execution. Three rounds of creative review maybe three rounds too late for relevance to today's always-on consumer. Outdated staffingmodels may create scope creep, or worse (for agencies), dollars left on the table.

The Leaders in this Magic Quadrant are finding ways to disrupt themselves from within —through, for example, more flexible compensation models — and deliver newfound agility totheir clients.

Agility Reigns

Customer touchpoints, channels and technologies (as well as CEO priorities) continuallychange; successful marketers and agencies must adapt to thrive.

Our Leaders' clients express an appreciation for agility. Words like "collaborative," "flexible"and "responsive" rise to the top of agency superlatives. CMOs also value an agency'swillingness to assimilate and respect their organization's culture — while pushing it toovercome internal inertia and grow its own vision.

As marketers rely on ever-growing rosters of technology and marketing partners, a leadagency's ability to collaborate with and lead those partners is critical — and is a key point ofpositive or negative differentiation in agencies' client reference surveys. The traditionalconcept of an agency of record is dying, and territorialism is a liability.

As for agency process, clients value it to the extent that it drives progress without impedingagility. Our Leaders consistently utilize respected, established, agile methodologies built toadapt to circumstances when required.

This desire for agility increases the appeal of smaller, independent agencies not covered inthis Magic Quadrant. Increasingly, we see some of the best traction on delivering agilitycoming from regional or boutique agencies, which are able to deliver an attractive balance of

3

4



strategy, creative and technology, but lack the global reach required by many marketers. Inmany ways, the pairing of a smaller, agile agency with an equally dynamic, upstart marketerpresents great risk to ad industry stalwarts and their clients. Those clients would be remiss innot looking beyond the large global networks.

What's Next?

We asked Magic Quadrant agencies for their take on the challenges and opportunities thatmarketers will face in the coming year. Through a wide range of detailed responses, three keythemes emerged:

Customer experience primacy and the move to continuous engagement — Successfulmarketers are already moving away from episodic, campaign-centric thinking to continuousengagement with customers (see "Synchronize Campaigns and Continuous EngagementWith Two-Speed Marketing" ). Innovation in customer journey mapping and experiencedesign is critical, and it can't be done within a narrow view of your industry alone. Yourcustomers' experience with your product will be compared with their last, best experiencewith a brand, even if that brand is in an entirely different category. This dynamic isespecially true as greater customer buying power erodes traditional differentiation andcompetitive buying options (see "Customer Experience Is the New Competitive Battlefield").

A focus on business outcomes, not marketing key performance indicators (KPIs) — Agenciesneed to help their clients rethink marketing's larger role in driving business results beyondjust marketing metrics (see "How to Develop an Effective Marketing Dashboard" ). As such,agencies must evolve their roles from marketing experts to business consultants. Whilethis trend favors the traditional management consultant players in this Magic Quadrant, themore creatively focused firms are investing in this capability, providing them an advantage.Advances in business intelligence, particularly machine learning and predictive analytics,favor the technology-centric agencies. A successful marketer will find an agency thatstrikes the right balance between consultative strength, creative storytelling fueled by data,and technological know-how.

Connected customers and commerce — Agencies will need the technical capabilities tointegrate new channels, media formats and connected things (including mobile, IoT andvirtual reality, to name a few) into a customer experience increasing in complexity. Brandsseeking to embed commerce across all customer touchpoints, online and offline, seekagencies that can deliver that capability seamlessly (see "Digital Commerce Is PrimeCandidate for Innovation in 2016" ).

Agencies to Watch

The following agencies aren't included in this Magic Quadrant due to limited revenue or globalreach, but they are experiencing significant growth and industry accolades, while challengingthe traditional agency business model:



Huge — This Brooklyn-based agency is a leader in mobile marketing, and it offers full-service capabilities. Its collaborative approach (using small, interdisciplinary teams)addresses the demand for agility in agency partners. The Drum recognized Huge's growinginternational presence by naming it the U.K.'s fastest-growing agency.

360i — Part of the Dentsu Aegis Network, 360i is a full-service digital agency focusing ondata-driven media and content. Named as the OMMA Agency of the Year three yearsrunning, 360i ranked seventh on Ad Age's 2016 A-List, and it earned accolades from Digidayas Best Content Marketing Agency. It posted double-digit revenue growth in 2015, poweredin part by a twofold increase in work with distiller Pernod Ricard.

Organic — Organic provides a full range of services — from advertising and socialmarketing campaigns to website and mobile app development. Its dynamic creativeplatform, Organism, leverages data and programmatic to deliver personalized experiencesto individuals. Its global-branded platform for Hilton helped drive significant increases inconversion rates and loyalty program enrollment. In 2015, Organic added AT&T, Wells Fargo,MetLife and Cars.com to its roster.

72andSunny — With its focus on cultural relevance, 72andSunny continues its run as one ofthe hottest shops around, placing fifth in Ad Age's 2016 Agency A-List — and named by FastCo. as one of 2015's Most Innovative Companies. Part of that innovation includes its stellarcollaborative capabilities. Part of MDC Partners, 72andSunny experienced a 33% jump inrevenue and 27% jump in staffing in 2015 — and added new business from Axe, MillerCoorsand General Mills. The firm continues to do more work with Google than any other agency.

Critical Mass — Part of Omnicom Group, Critical Mass is a full-service experience designagency with offices worldwide, including a recently launched presence in Brazil. In late2015, it acquired Zocalo Group, adding heft to its social and word-of-mouth capabilities.Critical Mass' work with forward-thinking fashion brands like Adidas and Guccicomplements its relationships with more traditional clients like Citi and HP Inc. Clientspraise the firm's high-quality work, as well as the insight of its strategists, creative/UXprofessionals, technologists and program managers.

EvidenceThis Magic Quadrant followed Gartner methodology for vendor evaluation, including a vendorsurvey, vendor briefs, vendor-provided references and conversations with Gartner end-userclients. It also includes material assembled by the Gartner Secondary Research Service (SRS)team from published sources. The authors wish to recognize the contributions of SRSresearchers Rahul Sharma, Aparna Bajaj, Pooja Daga, Sourish Chatterjee, ShailendraUpadhyay and Aditi Rastogi . They also wish to recognize project management and writingsupport services provided by Lauren Abel and Barbara Sibley.

5

6

1



D. Gianatasio. "What the In-House Agency Boom Means for CMOs and Outside Shops."(http://www.adweek.com/news/advertising-branding/what-house-agency-boom-means-cmos-and-outside-shops-168593) Adweek. 16 December 2015.

T. Dua. "Chobani CMO: The More You Outsource, the Less Creative You Get.(http://digiday.com/brands/chobani-cmo-outsource-less-creative-get/) " Digiday. 18 May 2015.

E.J. Schultz. "PepsiCo Exec Has Tough Words for Agencies." (http://adage.com/article/special-report-ana-annual-meeting-2015/agencies-fire-ana-convention/300942/) Ad Age. 15 October2015.

J. Neff. "The CMO's Guide to Agency Procurement." (http://adage.com/article/cmo-strategy/cmo-s-guide-agency-procurement/298536/) Ad Age. 13 May 2015.

L. Stein. "360i Is No. 7 on Ad Age's 2016 Agency A-List." (http://adage.com/article/special-report-agency-alist-2016/360i-7-ad-age-s-2016-agency-a-list/302228/) Ad Age. 25 January 2016.

M. Morrison. "72andSunny Is No. 5 on Ad Age's 2016 Agency A-List."(http://adage.com/article/special-report-agency-alist-2016/72andsunny-5-ad-age-s-2016-agency-a-list/302245/) Ad Age. 25 January 2016.

Evaluation Criteria Definitions

Ability to Execute

Product/Service: Core goods and services offered by the vendor for the defined market. Thisincludes current product/service capabilities, quality, feature sets, skills and so on, whetheroffered natively or through OEM agreements/partnerships as defined in the market definitionand detailed in the subcriteria.

Overall Viability: Viability includes an assessment of the overall organization's financialhealth, the financial and practical success of the business unit, and the likelihood that theindividual business unit will continue investing in the product, will continue offering theproduct and will advance the state of the art within the organization's portfolio of products.

Sales Execution/Pricing: The vendor's capabilities in all presales activities and the structurethat supports them. This includes deal management, pricing and negotiation, presalessupport, and the overall effectiveness of the sales channel.

Market Responsiveness/Record: Ability to respond, change direction, be flexible and achievecompetitive success as opportunities develop, competitors act, customer needs evolve andmarket dynamics change. This criterion also considers the vendor's history ofresponsiveness.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designed todeliver the organization's message to influence the market, promote the brand and business,increase awareness of the products, and establish a positive identification with the

1

2

3

4

5

6

http://www.adweek.com/news/advertising-branding/what-house-agency-boom-means-cmos-and-outside-shops-168593

http://digiday.com/brands/chobani-cmo-outsource-less-creative-get/

http://adage.com/article/special-report-ana-annual-meeting-2015/agencies-fire-ana-convention/300942/

http://adage.com/article/cmo-strategy/cmo-s-guide-agency-procurement/298536/

http://adage.com/article/special-report-agency-alist-2016/360i-7-ad-age-s-2016-agency-a-list/302228/

http://adage.com/article/special-report-agency-alist-2016/72andsunny-5-ad-age-s-2016-agency-a-list/302245/



product/brand and organization in the minds of buyers. This "mind share" can be driven by acombination of publicity, promotional initiatives, thought leadership, word of mouth and salesactivities.

Customer Experience: Relationships, products and services/programs that enable clients tobe successful with the products evaluated. Specifically, this includes the ways customersreceive technical support or account support. This can also include ancillary tools, customersupport programs (and the quality thereof), availability of user groups, service-levelagreements and so on.

Operations: The ability of the organization to meet its goals and commitments. Factorsinclude the quality of the organizational structure, including skills, experiences, programs,systems and other vehicles that enable the organization to operate effectively and efficientlyon an ongoing basis.

Completeness of Vision

Market Understanding: Ability of the vendor to understand buyers' wants and needs and totranslate those into products and services. Vendors that show the highest degree of visionlisten to and understand buyers' wants and needs, and can shape or enhance those with theiradded vision.

Marketing Strategy: A clear, differentiated set of messages consistently communicatedthroughout the organization and externalized through the website, advertising, customerprograms and positioning statements.

Sales Strategy: The strategy for selling products that uses the appropriate network of directand indirect sales, marketing, service, and communication affiliates that extend the scopeand depth of market reach, skills, expertise, technologies, services and the customer base.

Offering (Product) Strategy: The vendor's approach to product development and delivery thatemphasizes differentiation, functionality, methodology and feature sets as they map tocurrent and future requirements.

Business Model: The soundness and logic of the vendor's underlying business proposition.

Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings tomeet the specific needs of individual market segments, including vertical markets.

Innovation: Direct, related, complementary and synergistic layouts of resources, expertise orcapital for investment, consolidation, defensive or pre-emptive purposes.

Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meetthe specific needs of geographies outside the "home" or native geography, either directly orthrough partners, channels and subsidiaries as appropriate for that geography and market.



(http://gtnr.it/1KsfgQX)© 2016 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner,Inc. or its affiliates. This publication may not be reproduced or distributed in any form without Gartner'sprior written permission. If you are authorized to access this publication, your use of it is subject to the

Usage Guidelines for Gartner Services (/technology/about/policies/usage_guidelines.jsp) posted ongartner.com. The information contained in this publication has been obtained from sources believed to bereliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of suchinformation and shall have no liability for errors, omissions or inadequacies in such information. Thispublication consists of the opinions of Gartner's research organization and should not be construed asstatements of fact. The opinions expressed herein are subject to change without notice. Gartner providesinformation technology research and advisory services to a wide range of technology consumers,manufacturers and sellers, and may have client relationships with, and derive revenues from, companiesdiscussed herein. Although Gartner research may include a discussion of related legal issues, Gartner doesnot provide legal advice or services and its research should not be construed or used as such. Gartner is apublic company, and its shareholders may include firms and funds that have financial interests in entitiescovered in Gartner research. Gartner's Board of Directors may include senior managers of these firms orfunds. Gartner research is produced independently by its research organization without input or influencefrom these firms, funds or their managers. For further information on the independence and integrity of

Gartner research, see "Guiding Principles on Independence and Objectivity.(/technology/about/ombudsman/omb_guide2.jsp)"

About (http://www.gartner.com/technology/about.jsp)

Careers (http://www.gartner.com/technology/careers/)

Newsroom (http://www.gartner.com/newsroom/)

Policies (http://www.gartner.com/technology/about/policies/guidelines_ov.jsp)

Privacy (http://www.gartner.com/privacy)

Site Index (http://www.gartner.com/technology/site-index.jsp)

IT Glossary (http://www.gartner.com/it-glossary/)

Contact Gartner (http://www.gartner.com/technology/contact/contact_gartner.jsp)

http://www.gartner.com/technology/about/policies/usage_guidelines.jsp

http://www.gartner.com/technology/about/ombudsman/omb_guide2.jsp

http://www.gartner.com/technology/about.jsp

http://www.gartner.com/technology/careers/

http://www.gartner.com/newsroom/

http://www.gartner.com/technology/about/policies/guidelines_ov.jsp

http://www.gartner.com/privacy

http://www.gartner.com/technology/site-index.jsp

http://www.gartner.com/it-glossary/

http://www.gartner.com/technology/contact/contact_gartner.jsp

rz gartner reprint

Documents