The Year of the Independent Ad Agency

2025 has been dubbed the year of the independent advertising agency. Join Mark and Lorraine as they discuss the benefits independent agencies offer clients and why remaining independent matters in today’s marketing landscape. Tune in to learn where Innis Maggiore ranks among the growing number of agencies and how your agency can stand out from the crowd.

Join Mark and Lorraine for 30-ish as they discuss all things marketing, advertising, and of course … positioning! 

Transcript

Mark Vandegrift 
Welcome back to another episode of the Brand Shorthand Podcast. I'm your host, Mark Vandegrift, and with me today is our strategy superstar, Lorraine Kessler. Thing one, welcome back to the studio. It's been too long.

Lorraine Kessler
Yeah, it has been. It's fun being on the paddle board.

Mark Vandegrift 
I bet. Well, between my trip to Italy and your travels, we've had to miss a few weeks. What's exciting in your life?

Lorraine Kessler
Yep, that's right. Just being able to stand on the paddle board. How about your life? You had a much more interesting trip.

Mark Vandegrift 
Well, speaking of paddle boards, it was interesting over in Europe at the few places we went, one of the first days was Polignano Amare, which is just south of Bari. And right off the cliffs there, tons of people trying to paddle board. It is the funniest thing to watch them slip slide off that.

Lorraine Kessler
Oh my gosh, you're kidding me.

Mark Vandegrift 
No, it's probably tourists that thought running a paddle board out, you know, there below the cliffs would be fun, but they didn't realize paddle boarding is hard to get the hang of.

Lorraine Kessler
Well, and if it's rough at all, I mean, it's always wicked when you're, you can have the calmest day and then a pontoon goes by speeding or a master craft in my case. And all of sudden you're like, so if there's any wind or it's, it's all different game.

Mark Vandegrift 
yeah, and once it gets wet, once you get wet, it's bad news.

Lorraine Kessler
And then some guy, and then every year there's some new toy, right? We have the guy, I forget what they call those things that have the jet things where he jets out of the water on feet.
like on their feet. You hook it to a jet ski and I forget where you call that. But he's like at least 30 feet above the water, 20 feet above the water with this power propulsion. Looks like something from a Marvel movie. And then this year there was a guy with a hover board who used it both on the land and on the lake. Just like hovered like the cross. I know, not something I'm enjoying.

Mark Vandegrift 
Well, we should probably get started with our topics since we haven't met for a few weeks. Do we even know how to do this anymore?

Lorraine Kessler
wW have a topic? No, we have a topic? thought this was it.

Mark Vandegrift 
Yeah. Well, I saw an article recently and it was kind of fitting because we just celebrated our 50th year last year and we're still independent, as we like to say. And the article dubbed this year, 2025, as the year of independent ad agencies.

Lorraine Kessler
Oh, finally.

Mark Vandegrift
So I thought it might be interesting to discuss a little bit about that and what the value of being independent means. We actually have a client that we know that there's value in them being independent. I think you know who I'm talking about. And it's kind of inside baseball discussion, but it's there's value in being independent. So just for context, I want to give everyone context on where Innis Maggiore fits into the spectrum of ad agencies. And this was at last measure. So we have some updated stats that I'll bring in near the end, but we're in the top 3 % of agencies in the nation. Now how do we get there? Well, there's about 16,000 total agencies or so, plus or minus, maybe 1,000, and we were slotted in around 450, and so that puts us in the top 3 % of agencies, and they do that based on total staff and total revenue. And we've been independent from the beginning. Chuck Innis and Dick Maggiore founded the agency in 1874. So we're 51 years young and still independent. So beyond that tenure, why are we so proud to remain independent? Well, that's what our topic's gonna be today. So to kick off the discussion, I'll give a little bit of an overview of the article that named 2025 as the year of the independent ad agency and some of the key points to it. So number one, big ad agencies are dominating. They have billions and billions of dollars in revenue. They have big clients and they have big prestige. But even more so is they're not just big, they're getting bigger.So they've been merging or acquiring in 2024 alone, 13 major marketing communication agencies, what we call big agencies, made 52 acquisitions. Okay. So I'm not sure how that works out perfectly in math for each one of them, but that means for each of the 13 agencies they each acquired four on average, right? So that's pretty major. I can't even imagine being the COO that has to integrate all those agencies and the cultures and everything else that comes along with it. So the second thing this article brought to mind was these bigger ad agencies are focused on growth. Smaller creative agencies are measuring wins based on clients' success. Now, I don't know why you would you pick growth over client success, but it seems pretty obvious to me who wins in that equation. And what has happened is the smaller agencies are able to use new technology to build and monitor and optimize campaigns. And so a lot of them have the same capability as these bigger players. So there's not necessarily a distinct advantage in being bigger versus being the size we are. We would be considered a medium size agency. They mentioned a study also that revealed 91 % of the brands had moved at least some of their digital marketing operations in-house. So what that's saying is they want 24-7 access to the campaign analytics and saving on other people like these big agencies that charge big bucks just to save on the advertising spend. Imagine putting more toward media instead of spending on big agencies. So the overall kind of tenor of the article was that these big agencies have lost trust with their clients. And that's where these independent agencies have been able to step in with their technological advancements with their focus on clients' successes, with their agility, their nimbleness, you name it, that they have an advantage over them. So I don't know if you were able to look through that article, but let me ask you more generic questions in case you haven't. We are seeing these big agencies, all they care about is acquisition, acquisition, growth, growth, growth. Talk a little bit based on your why remaining an independent agency matters today and why it should matter to our clients.

Lorraine Kessler
Well, you said it from a position standpoint, one of the questions you always ask is where to play, right? Where to play to win. And the independent agencies are able to play in the field that you said it, that these big agencies ignore and don't want to play. They want big clients, the bigger the better. They're big, they want to get bigger. It's all about big, big, big. And 95 % of companies in America are small or if you say 50 employees or less, and startups. Not every startup is going to have Jeff Bezos, know, whoops, but as he just showed off a little.

Mark Vandegrift 
50 million to blow on a wedding in Venice? Is that what we're talking about?

Lorraine Kessler
Yeah, yeah, yeah, oh my God. So, you know, so there's a huge, vast market for clients who need more personal service, more customized services, more agility. more care, more relationship building that they really trust the people they're working with. So, and that hasn't changed since I started the business in 1981 around the same time as Dick, and it really hasn't changed. And so I'll quote Al Rieson, size is not the determinant of success. Focus is. So they're focused on big, they're not gonna handle the little guy. And we're focused on everything else that's been left on the table. And we get to choose what we work on in terms of, you know, who's a great client or can be a good client or will be a good client in the future versus someone who's really not worth the risk. So I think that's why independent agencies will always find a place to be because the desperate need to grow. And I've heard you say that about these big agencies. It can actually be harmful to a business, particularly if it leads to unfocus. And the more, the bigger these agencies get, right? It's like a freight liner. You can't turn a freight liner fast, right? If you see an obstacle ahead, that freight liner is going to need miles to make the turn. But we're like in little high performance speed boats and we're able to, you turn on a dime. So the bigger they get, the harder it is to manage on one hand, bring all those pieces together and have consistency, I think. And then they become more generalist, right? And the generalist is always, well, almost always, I shouldn't use words, but almost always vulnerable to a focus specialist. So you're go to a big, big, big agency where you're the little guy or the medium guy and all you really need is a discrete package of digital and SEO, probably not, right? You're gonna go to a specialist in digital and SEO. And that's kind of how the world works.

Mark Vandegrift 
Yeah, it's interesting because to your point, I'll get new business calls in here and it'll be a couple person firm or 10 person firm. And they'll go, I have to ask you before we even talk, you work with us? And the answer is always, yeah, we work for one person companies up to Microsoft, Disney, Bank of America. We work with clients in China and Europe and Latin America and Canada, we've had clients all over the globe. But we can also work for a one person company. And it's not the size of the company as much as it's the size of the marketing budget. You tell me you have $5 to spend, I'm going to say just don't even spend the five bucks, go get a Starbucks. But if you have sufficient means to invest in your brand, then yeah, we certainly can talk.

Lorraine Kessler
Yeah, we're in perfect, I mean, sometimes say being in the middle is bad, but I think it's great when the middle is filled with a large volume of potential customers who value a lot or care a lot about what you do uniquely for them. And that's make them feel special, have the services they need, have a philosophy as we do positioning that assures them that when we handle their marketing, there's integrity behind it, and they're gonna be saying the right thing to the right audiences at the right time. You know, it's a slam dunk. It's up to us to have people either say no to us or we politely just decline because there's just a great audience for what we do. And most independent audiences.

Mark Vandegrift 
Right. Yeah, well, let's talk about a few of the other benefits. This is, I guess, just a random list, but you could speak to each of these items independently, pun intended. We're based in Canton, Ohio, so we're going to have strong local and regional knowledge. So if your market is in Canton or...Kent and Akron Cleveland or Northeast Ohio or the Midwest. We have that knowledge about how consumers and business buyers operate in this market. And that's not always the case when large holding companies or ad networks come in because they're operating maybe from the coasts, right? And we know an agency in New York or LA cannot even comprehend the culture of Canton, Ohio or Cleveland, Ohio or the Midwest. So maybe speak to the idea of having resident geographical knowledge.

Lorraine Kessler
Well, of course that gives you a leg up. That's an advantage. It can also be a liability. It's an advantage for all the reasons you said. There's a culture that goes along with where you live. There's a lot of these kind of under the current feelings and emotions and kind of just knowing how the people in the communities think. And they do think differently about different things. But it's also gonna be a limitation in that if you go to another market and you have an opportunity they'll be, well, you don't know our market if they're geographically bound. But, you know, I found that if you take culture as a broader thing, right, it doesn't just apply to geography. It also applies to just some key areas or industries that we have experiencing. We were able to work with the SBC, the Southern Bactis Convention which is very distinct culture, very Southern in its origin, very doctrinally strong in its beliefs, in its Christian beliefs, different than other churches or other organizations. And so we were able to mesh with that because culturally we have people who really fit with that. And we're true Northerners as, you know, I used to kid them, well, I'm Southerner too. And they would say, how are you possibly Southern? I'm from South Jersey. It's a little relative. In New Jersey, I'm a Southerner. So, I mean, I think that, you know, what you have to find to do, that can be an advantage, but you don't want to just rest on that. You want to be able to build kind of a skill set and also the wherewithal, kind of a worldliness. I think the fact that you world travel, for example, when you speak fluent German and that you're interested in world things We have many others who have a broader interest. I think that's really important for agency people to tie into different cultures and different understandings.

Mark Vandegrift 
Yeah. Another one that we list usually, and I can see this going both ways, of course, because larger agencies would argue otherwise, but I think it goes to your Freightliner comment, and that's greater innovation and creativity. Now, let me explain that because innovation in our world means adopting new technologies very quickly. So I would say we are set up because of our ability to say, there's a new technology, go investigate it and learn it without having to get all this red tape involved that a larger agency would say, okay, who's gonna be the stakeholder? Who's gonna be the owner of the project? And they get into this process of trying to learn something. And if they go down the wrong road, they're also not able to adapt quickly. So by innovation, I'm speaking to that. And then also on the creativity side, we kind of feel with positioning that we can be as creative as we need to be. But as an independent agency, limiting it to that, our creativity is not restricted by what I would call the large agency norms, right?which to me is winning awards, making sure the account buys more, pays more, whatever. Whereas when we have the focus on our client success, the creativity now is targeted in the right way, I think is the way I wanna say it. What's your comment on that?

Lorraine Kessler
Well, your creativity is in service to the right strategy. I would always say that it plays a servant role, not a master role, although it can lead the strategy to great heights by how it's done. So I mean that in the most humble way. I think what happens is the bigger an organization, I don't care if you're talking about agencies or you're talking about retail, like when I worked with Sears, the bigger the agency, the bigger the business, the more bureaucracy, the more layers. What happens is innovation is stymied. There's a homostasis that happens. And the reason it happens is that mid-level managers and below feel like they have no voice. They don't have a channel to influence and to whisper in the ear of the CEO or whoever the CIO, whatever the powers that be, they don't have a channel at all. And they're often managed by people who are competitive with them, who want to keep their job at their level and keep you at your level. And they're not motivated to really think outside the day and the job that they have. And there's also less ownership of the business in terms of whether it does well or not, they have a less direct influence or feeling connection to the success. If it's that big, you're like, hey, you know, I didn't do much this week and no one figured it out, right? So I still got my paycheck. There's a homostasis that takes place and that's deadly to innovation because you really are not hearing from those who might be closer to the customer, closer to the market, closer even to the technology about what's changing and what we need to do. The companies, some of these big companies have decided because of that, well, we're not going to DIY it, we'll buy it. We'll keep an eye out and we'll go buy a company and then cobble them in because they have this skillset, let's say an SEO or digital or whatever. And we'll bring them in under And what happens is you immediately neutralize that entity. The management just, the bureaucratic way of management is the culture and it can have the same suppressing effect on those partners that you brought in. So they're no longer independent thinkers. So I think like, you know, they need big money, big budget and they're not going to experiment with much else. And our people know in a way that when they create something or a protocol or a procedure, that's the right way to do SEO or to do whatever we do technologically, which is vast and you know more about that than I, that it has a direct line to whether we're successful for clients and our bottom line and their job. So there's just something about that that's more direct and more meaningful.

Mark Vandegrift 
Yeah, another one is an independent agency can develop stronger, more personal relationships. And I think we're kind of special in that way. I don't know if this is true of all independent agencies. But we have clients that have been around for almost the life of the agency, one that's, think, 45 years this year another one, is one of our largest going on 30 years. And what's interesting about that is that's an agency client relationship. So there's a body of knowledge, but added to that, which I think is another level is the tenure of a lot of our associates. Over 50 % of our staff has been here 10 years or longer. And I think one third is 20 years or longer. And so a couple of our account people have been here long enough that they've held that relationship the entire time they've been here. So you imagine knowing an account that well. What's funny is we know more sometimes than the client contacts because the contacts keep switching out at the client. But our account people and some of our creative staff know that account so well. That I think brings value to it. One of the comments We get all the time and one of the major reasons for switching is, Hey, just calling you up because we're on our third, client team in the last year. And we're just tired of constantly switching out. And before they talk about anything else, they want to know how long have your people been there? Like what's your average client relationship length? How long have they been working? We have such a wonderful story to tell. And I think people that love independent agencies and what we would call small business, they stick around for that long because we take care of our own, right? You're not a number at Innis Maggiore, you're a person, you're a valuable staff person, and you're part of the family of Innis Maggiore. Well, that translates into great client relationships and knowing industries and clients, again, far better than sometimes the new client contact might know at the company that we're working with.

Lorraine Kessler
And I like to qualify what it means to be a great relationship agency, because I led client services at Innis Maggiore for 20 years. It's not about beers after work, playing pool, having a lot of fun, going out on dates, schmoozing and playing golf. We've never been a golf agency. Thank heavens.

Mark Vandegrift 
Even though you and I both love golf.

Lorraine Kessler
Right. you know, hey, there was a time, you know, with my 12 handicap and then became a six, I couldn't even step on the course because of the women weren't allowed. So that, and I used to to send my clients and my other agency with the, with the owners. It was really annoying, but that's not the kind of relationship we've built in this majority. The relationship is we really passionately respect you as a person, whoever the contact is. That's number one. We respect what your role is and that helps you respect our work. We respect the fact that our job is to help you improve and to achieve whatever business goals you want to achieve. And so we're focused on building the right relationship by accomplishment, by achieving what needs to be achieved at time and again. And when we're not, we're honest about and sit down and have kind of truth telling about what we think went right, what we think didn't go right. And then...were obligated to know the industry and to keep fresh on it. And I always felt like one of the jobs that we've done as a client service team is we've kind of managed the work for the client. We kind of are the repository of everything that's been done for that client from beginning to end. So when contacts change, we're able, we're there, we're the vault. We can say, this is what happened in this year. These were the decisions that were made. This is why they were made. This is when we changed. Here we are. And we can do that for the next contact while we keep that beautiful record of integrity as to how we got to where we got and where we want to go and why. So we really help manage the client.

Mark Vandegrift 
Earlier, I had suggested 16,000 total agencies. So I'm going to go to an updated stat, supposedly. This one comes from Statista, I think is how you say it. And they just published a report in June that shows the number of ad agencies in the United States from 2007 to 2022. And as of 2022, there were about 15,000 advertising agencies. And that's the highest number between 2007 and 22. So whether there's 15 or 16,000, that's a lot of competition. And it's interesting looking at this number because the average size, now average, not the median, but average is 15 employees. If you were to knock out the top 250 agencies, it goes down to under 10 employees on average.

Lorraine 
That's insane. Yeah.

Mark Vandegrift 
So that indicates most of these firms are freelancers or very boutique firms. You know, they're specialists, as you said. They might be web shops or PR shops or social media shops seems to be a good thing. A design shop, yep. So, and then I found another article that showed the top 250 agency rankings for 2025 based on revenue numbers. And Innis Maggiore is just outside of that top 250. So we might be closer to 300 than we are to 500. I mentioned before, our old data was at 454, I think. So there aren't a lot of large independent agencies. And once you get to our range, even, was, to me, it was interesting to see there aren't a lot of medium independent agencies either. And we have 32 associates, which means we have a lot of specialties in-house, specialists with specialties. So you know our history as well as anyone and how we've approached the market. If you were consulting with another agency, okay, that was independent, just starting up, what would you tell them on how to stand out among this crowd of 15,000 plus agencies?

Lorraine Kessler
Well, I peel back the onion in the pages of history. The greatest agencies were led by thought leaders. So I think thought leadership is absolutely needed. Who's the thought leaders in the firm and how do you define that thought leadership? And they have a clear distinctive philosophy. I Old Lavi was all about image and impression. Birnbach was all about the big idea. Rosser Reeves gave us the USP. Trout and Reeves positioning, Claude Hopkins scientific advertising. So they had an approach and a thought in a way that they looked at the business that helped your business succeed. And for us, it's positioning 21st century stuff. Right? I think it's positioning that's radical. It radically affects every message you put out, regardless of the media format. And it's radical differentiation that also goes deep, deep, deep to become the operating philosophy for the whole, or operating theory, whatever you want to call it, for the entire business.

Lorraine Kessler
If you're going to be about safe, safe auto, safe whatever safe driving, then it affects everything you do from engineering to customer service to the parts, the raw materials you buy, procurement to your marketing, everything. And that is radical differentiation. So it goes much deeper than the USP, which Rosser Reeves was talking mainly about the message of product having a specific selling message. It goes even deeper than I think Trout and Lisa's positioning, which is still a little broader, but still about basically the service of product and what the company promises. But it goes even deeper to become the absolute holy grail that defines the operating system of the entire company. And it informs all four P's of marketing, right? Like I said, product, what it is, what it could be, how it's made, where it's sold, the promotion, the advertising, the tone, where you're seeing the PR, your social, price, whether you're going be luxury, premium, value, or low cost, and the place, where you play to win, what markets or marketplaces, what regions, what channels. These are all informed by radical position. So that's our philosophy. I would, as a buyer, that would be my first question for an ad agency before I even ask what's your long tenure of associates and client relationships. I think that's all great and those are great questions to ask. But my first thing would be what differentiates you in terms of your theory of marketing and how are you holding yourself to that? I don't think many agencies can answer that.

Mark Vandegrift 
I don't know of any actually that we've ever run into, I should say. I'm sure they do that to one degree or another, but it's funny how many agencies we run up against, you go visit their website, and I saw a new one the other day. just north of us here. I had never heard of them. And it said, we're all about the lead conversion.

Lorraine Kessler
We're all about the what?

Mark Vandegrift 
Lead conversion.

Lorraine Kessler
Okay. Like, who isn't? No, we... I mean, if you can take the opposite, it's like, No, we're not about that. We hope you don't have any convergence. I you enjoy spending money with us.

Mark Vandegrift 
Exactly. I knew you were going to say that. was teeing you up. 

Lorraine Kessler
I mean, if you can take the opposite, it's like what?

Mark Vandegrift 
We're not about leads. We're not about conversions.

Lorraine Kessler
No, we're not about that. We hope you don't have any convergence. I you enjoy spending money with us.

Mark Vandegrift 
Yep.Yeah. Yeah, I won't give you the name of them, but let's just say the words lead and conversion were in their name of their company.

Lorraine Kessler
First, it's like kind of old language too, right? Yeah, yeah, it is. Yeah, yeah.

Mark Vandegrift 
Yeah, it is actually. They're gonna start dating themselves. but you know, they didn't ask us so, and we're glad when the competition doesn't do well.

Lorraine Kessler
So if a client was going to interview that agency, the way that they would start is, I saw, that you're all about lead conversion. What's your philosophy for how you create those leads that you stick to? And then how do you, what does a lead conversion mean to you? Because again, this is fungible. People have all these different definitions of lead conversion. which you and I would not accept as a true definition. Yeah.

Mark Vandegrift 
Right. Good. Well, let's wrap up today's episode of the Brand Shorthand Podcast. It's good to be back Lorraine. Thanks for joining us. And thank you for our listeners for joining us. Don't forget to like, subscribe, subscribe, subscribe and share with a friend. And until next time, have an amazing day.