Advertising Age’s 2009 agency rankings by revenue (cut every way imaginable) belies the dramatic transformation our industry is undergoing, even through the worst recession in 75 years.

From my vantage point, the key takeaway is that independently owned Digital/Direct (or as we like to call it, Personalized Marketing) agencies continued to grow faster and take share from the dinosaurs (also known as the publicly traded agency networks).  Some highlights that illustrate the acceleration of this trend are:

• 64% of Digital agencies ranked in the Top 100 U.S. Agencies climbed one or more positions, an average of 10.3 positions, and experienced a 3% average revenue growth; while 59% of non-Digital agencies fell at least one position, an average of 8 positions, and all non-Digital agencies experienced an average 7.5% revenue decline.

• 10 independent agencies moved up an average of 10.3 positions, and experienced  7.3% average revenue growth; while 43 of their networked brethren fell an average of 6.2 positions and all networked agencies experienced a 5.4% average revenue decline.

As Chairman & CEO of one of the beneficiaries and, I would like to believe, accelerators of this secular trend,  I can tell you from my discussions with CMOs, that one of the core issues driving this shift is marketers’ need to continually make their brands more personally relevant to their most important customers and prospects. 

It is here where Digital/Direct agencies, who are independent, have three distinct advantages:

1. They are not saddled with the goal conflict of the networked agencies, who “fight like dogs over the revenue bone” between broadcast, digital and direct.

2. They have purpose-built organizations which are structured to handle the challenges of managing strategic consulting, technology, analytics and creative, disciplines that do not naturally harmonize well.

3. Their independence allows them to attract, retain and incent the best talent in these highly sought after specialties through making the best and the brightest owners with vehicles like options, phantom stock plans and profit interests.

The “Age of the Dinosaurs” is over.

-Chris Kuenne, Chairman and CEO, Rosetta