Marketing Agency/Client Service-For-Service Provision in an Age of Digital Transformation

Abstract

ABSTRACTPurpose: To explore changes in agency/client value co-creation, at a time when digital transformation is having a major impact on the marketing communications process. The theoretical framework of the research relates to value co-creation in the service-for-service provision, a fundamental aspect of Service-Dominant Logic (S-D Logic) theory.Methodology/approach: The research was exploratory, primarily using qualitative methods. In addition, some quantitative survey data have also been included to demonstrate greater generalizability on certain key questions. Building on dyadic research with clients and their agencies, the current research includes a survey of agencies; interviews with clients and a follow up survey with clients.Findings: The nature of service-for-service provision between clients and agencies is outlined. Many aspects of service are equally likely to be internally or externally provided. This high crossover particularly relates to supporting aspects of digital marketing. While much digital marketing appears to have initially been provided externally there seems to be a trend to bring these aspects of service in-house. The views of clients and agencies on their relationship, as being either transactional or a partnership, appears to be related to the degree of service required and provided.Research implications: A service-for-service perspective is instructive in considering how changes in the external environment are impacting on what is done by agencies and what is done by clients. This new approach has the potential to enhance existing relationship based research in this context. The services required by clients depend on the resources that they already possess. Therefore, it is the absence of an operant resource that leads to the need for external service provision and in turn requires co-creation.Practical implications: There are no hard and fast rules on what is provided by the agency and what is provided in-house. This relates particularly to digital aspects of marketing and suggests that the level of crossover is higher than historically. With digital media becoming such an important aspect of communicating with customers, this is particularly significant in considering the nature of the relationship between agency and client and whether it is seen as a partnership or transactional.Originality/value/contribution: Historically, the dominant approach to analyzing agency/clients has been to focus on relationships. Taking a service-for-service approach is novel and relevant in analyzing a context in which digitization and media fragmentation has caused significant changes and where the perspectives of S-D Logic have the potential to provide new insights, explaining aspects that are not covered by taking purely a relationship approach. The contribution to S-D Logic is at the level of midrange theory development, through applying ideas from S-D – Logic in the context of the application, helping to refine and add to the credibility of the theory. This exploration of the co-creation of value between clients and their agencies demonstrates the applicability of a framework from S-D Logic in a context that is an important part of marketing management.