“Traditional ad agencies don’t get it” and “digital agencies can’t follow through on their ideas” – this seems to be the current debate in the marketing community. But is this debate properly cast or are we missing the key point?

For example, in a controversial article in AdAge late last week entitled ‘Why Digital Agencies Aren’t Ready to Lead’, Ana Andjelic, a freelance strategist whose Ph.D. dissertation was on digital branding, presents a model that separates digital from traditional agencies based on organizational theorist James March’s Exploration vs. Exploitation dichotomy.

(In case you, like me, aren’t up to speed on this subject, here is a handy definition of Exploration vs. Exploitation: |n essence, discovering new possibilities, conducting research, varying product lines, risk taking, innovation all fall under the realm of Exploration. On the other hand, Exploitation involves the refinement of current procedures: efficiency, production, execution, and so forth… Exploration is a long-term process, with a risky, uncertain outcome. Exploitation by contrast is short-term, with immediate, relatively certain benefits. Organizations face the problem of allocating resources between Exploration and Exploitation. Based on this model, the best companies have the optimal balance between Exploration and Exploitation; those less successful are doing too much of either.)

Using this model, digital agencies are considered as excelling at Exploration (i.e., impress clients with their passion, drive and technology know-how but cannot follow through) and traditional agencies as thriving on Exploitation (i.e., are risk-averse, accountable and systematic, but able to deliver).

What the troops are saying

What made this online article so interesting for me were the over 92 comments posted as of the time of me writing this post (worth reading here. There is passion as well as bile in those comments!).

The comments were posted mostly (I am guessing from the tone and content) by representatives of traditional agencies as well as digital, and range from well articulated and thoughtful to fringe and faltering.

However, they all missed the point: the comments are mostly self-serving and focus on who is more deserving of the client’s attention (and budget) and not on who delivers most value to the client.

This is wrong because deserving to be at the table and leading the marketing charge should only be a function of who delivers most value to the client.

As long as both digital and traditional agencies continue to recommend strategies that align with their own profitability model and not their client’s, there will be no resolution of the debate.

And the client’s role?

The client is only too often silent. The job of delivering greater value is enabled by the client’s understanding of its own business model and value proposition. And this means that the Marketing suite needs to move beyond “brand obsession” to a deep understanding of the company’s business model, as well as an understanding of the agency’s own profitability model.

As we have blogged in the past:

• Marketing has no real say within most top organizations

• There exists a big disconnect between what advertisers and what consumers believe works when it comes to marketing

In our experience, we see it as the marketing client’s role to define the business objectives in order to optimize profitability and then hire the right agency or agencies to deliver on those objectives.

Plus, clients need to be vigilant about aligning their needs with the right service suppliers who can not only service them properly but remain in business doing so for the long haul.

Only this way will the right agency type be ready to lead.