DR: Can you please tell us a bit more about how this investment came about and just what sort of figures we’re talking?
MH: Serendipity! We’d been starting to feel restless about the size of the opportunity in our market, and the limitations of organic growth in moving quickly to develop capability. We started to explore potential funding opportunities that would mean we could accelerate the growth of capabilities our clients want and need, and were introduced to Horizon Capital at the same time. Horizon happened to have already mapped the B2B marketing landscape and identified it as a high-growth area that suffers from a lot of fragmentation in providers. In The Marketing Practice they saw the opportunity to invest in a ‘platform’, and our visions began to align. I can’t share specifically what figures we’ll be investing, partly because it’s not a fixed investment. We’re already finding there’s very strong appetite for joining forces, and the funding won’t be the limiting factor.
DR: How do you intend to use this investment?
MH: In short it’s all about client value. Our founding principles were all about B2B marketing that sells – i.e. delivers genuine, demonstrable growth for clients. We’ve stuck close to that principle, and so our heritage has been in Account-based Marketing and highly targeted demand gen. We feel there’s a big opportunity to apply those principles to greater effect. For example we’ll be enhancing our digital, media and martech offerings, and looking to invest in global scale to build on our presence in the US, Europe and APAC. What our clients want is to be contributing sales growth to their businesses, and to do that on an international scale. That will be our north star.
DR: This isn’t the only major investment in B2B we’re seeing lately. Why do you think B2B is attracting so much investment at present?
MH: B2B tech is growing fast, accelerated by the pandemic. And tech is really the primary source of investment in B2B marketing. As those B2B tech businesses have looked to mature their marketing, it’s brought a plethora of service providers (agencies, consultants, tech and more) who have seen the low bar and the high potential in the market. The result is we’re in a growth market (because people are buying more B2B tech and services), but one that’s highly fragmented. It’s this fragmentation that attracts investors, I think. As well as the state of maturity – though our industry has matured a lot (quality, supply, tech) it’s still got a way to go, and that represents opportunity for investors who can create value from that process.
DR: So, you’re investing a lot in ABM and demand, but what do you think the future of these two things looks like? There’s a lot of talk that the dividing line between the two is just going to keep blurring until they’re just one indistinguishable thing. Is that something you expect?
MH: I love this topic – it creates so much hand-wringing! What I’ve been hearing from conversations with other agencies owners is a bit of a divide between “ABM purists” and what they’d think of as “ABM newbies”. The purists see ABM as all about sales and growth consultancy, strategic 1:1 engagement, rich content. And when the newbies say ABM they normally mean personalised media or other digital engagement. The purists see it as a strategy, the newbies as a tactic or channel. The reality is the two are, rightly, coming closer together. Personally I think it’s a red herring. It all comes down to the end-customer, and the varying degrees of investment you want to put into engaging them. If the tactics you use can be smarter than they were 5 years ago, that’s just a bonus.
DR: In our recent US Agencies Benchmarking Report, you finished seventh in our Top 10 fastest growing agencies list, seventh in our Top 10 rising stars, and sixth in our Top 10 international agencies. So, quite a year all round. We can only assume this investment is going to keep pushing The Marketing Practice up the ranks. What’s the long-term vision for your agency?
MH: A big question! Fundamentally I want our growth to be meaningful. What that means is it’s growth that comes from bringing more value to clients, sticking close to those founding principles, not by just acquiring businesses and taking on any brief. So our strategy is to go even further in ensuring we deliver reliable, outstanding sales outcomes for clients from marketing. We’ll do that by having more tools and capabilities at our disposal, getting smarter by having richer data and insight, and by being able to tackle bigger client challenges through international scale. In 3-5 years’ time we’ll be thinking of ourselves more as a growth platform for our clients, rather than a traditional agency.
DR: According to our recent Trend Tracker, growth marketing is the number one thing agencies and client-side marketers are focusing on this year. How do you see agencies helping clients make growth central to their work?
MH: It goes back to becoming more of a growth platform than an ‘agency’. It starts with understanding and analysing what works when it comes to creating growth through marketing – which is why there’s such a vital focus on data and insight. I talk about TMP needing to bring the best of an agency (creative and comms excellence), with the best of a consultancy (credibility, reliability, integrity) and the best of a tech business (data-driven, scalable).
DR: What’s your expectation for the agency marketplace over the next 12 months? Not just for The Marketing Practice, but in general? For all the doom and gloom, the results of our recent Agencies Benchmarking Reports demonstrates that agencies, for the most part, just continued to grow. Do you expect more of the same? If so, how?
MH: As part of our new investment journey, I’ve probably spoken with 10-15 agency owners or chief execs in the last month or two. All of them are seeing so much growth that their biggest challenge is how they scale to deliver it for clients. I’m sure that will continue, and it’s why I think there’ll continue to be a degree of consolidation as agencies see the opportunity to join forces through a combined platform and a common set of values and principles. That’s my hope, anyway, as it’s what we want to achieve! But the signs are that we aren’t the only ones. But I imagine there’ll also be more partnerships as well, and smart approaches for scaling up such as off-shoring. And, lastly, more collaboration. I started working with a few other agencies recently on a shared Diversity and Inclusion initiative, and it’s been fascinating how much more we can achieve for that sort of cause when partnering. I’m sure the same can apply to client engagements.
