As the overall economy slumped in 2008, interactive agencies reaped the benefits of marketers' shift in spending to more affordable, trackable online media.
Most interactive agencies reported double-digit growth last year, buoyed by increased spending on search marketing, social media, Web site development, online video and other interactive formats.
Total Internet ad revenue for the year was $23.4 billion, up 10.6% from 2007, according to the Interactive Advertising Bureau and PricewaterhouseCoopers.
The leading online advertising categories were search: (45% of total revenue), display advertising (33%), rich media (7%) and online video (3%).
And while total Internet ad spending slowed in the fourth quarter (up just 2.6% from the year-earlier period), most online agencies reported their best year ever.
Traction, winner of the interactive category in this year's Top Agencies Special Report, grew its revenue 30% last year, with much of its growth coming from existing clients such as Adobe Systems, Bank of America and Sun Microsystems, as these marketers increased their online marketing efforts. The agency picked up new clients as well, including being named agency of record for California Bank & Trust and Message Systems.
“We have done a lot of interesting social media work,” said Adam Kleinberg, CEO of Traction. For example, the agency developed a Facebook campaign for Adobe aimed at the student market and designed to promote Adobe design software. It also expanded its work in user design, microsite development and experiential marketing.
Digitas, runner-up in the interactive category, also had its best year ever, doubling its total revenue and establishing a new b2b unit called Digitas B2B.
“Digital b2b is at the heart of what we're trying to build—a very strong practice area within the agency, offering marketing perspective and strategy across multiple regions. We want to create a culture of experience sharing and building across the organization,” said Seth Solomons, CMO of Digitas.
The unit created innovative digital campaigns for such b2b clients as IBM Corp., Samsung and Shell, making use of a variety of applications and technologies, from online video to social networking.
“One thing that emerged as incredibly important is the next generation of use of video as a way to build connections and create communities,” said Laura Lang, CEO of Digitas. “In some ways, the development of community in b2b went faster than in b-to-c.”
For example, the agency used short videos of IT professionals on a Web site for Samsung solid state drives in an effort to build community and share stories.
Digitas also tried community-building for IBM (in an effort called “Smart Market” aimed at SMBs) and for Shell (in a community called Dialogues to foster debate around energy issues).
“This is the place where b2b is moving ahead very aggressively,” Lang said.
BusinessOnLine, which received honorable mention in the interactive agency category, boosted its revenue 35% last year through new client wins and growth from existing clients such as AutoDesk, Caterpillar and Sybase Inc.
“Right now, from a digital marketing perspective, if you can provide an answer to the interactive marketing challenge, there is an opportunity to gain market share,” said Thad Kahlow, CEO of BusinessOnLine.
“First, people are asking to drive more targeted traffic into the funnel using integrated search marketing campaigns. Second is social media—a lot of marketers understand the value and power behind social media.”
To meet this demand, BusinessOnLine created a social media practice and developed campaigns for clients including the American Red Cross, Caterpillar and Sony.
The agency also expanded its work in search marketing, Web site design, user experience and analytics. It developed, for example, a global Web site strategy for Key Technology, including a U.S. site and five international sites.
The campaign resulted in an 86% increase in overall site traffic; a 53% increase in monthly return visitors; and a 122% increase in conversions.
“Marketers are being tasked with doing more with less,” Kahlow said. “Our approach is results-based optimization with every campaign.”
TOP B-to-B ADVERTISING AGENCIES
Runner-up - DDB
Honorable Mention - BBDO
Business to Business
Runner-Up - Eric Mower & Associates
Honorable Mention - Doremus
Rogan + Partners
Runner-up - Koroberi
Honorable Mention - Sullivan
Runner-up - Digitas
Honorable Mention - BusinessOnLine
What Recession? Top b2b agencies find opportunities to grow business, add services.