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Social media market heats up

The social media market is heating up quickly. Here’s the 4 indicators I see:

1. Recruiters abound

One of our team has had four recruitment callers in two weeks. One directly from a substantial traditional agency with a name your nan would recognise even though you nan doesn’t know agency land, two from ‘headhunters’ and I can’t remember where the other was from – a start-up agency abroad perhaps. Another of our team (and board) had a call last week. Some of our friends in the industry are finding that their needs for good people in this area exceed the available supply they can find.

As a side note, on this front I’m not personally fussed about our team getting calls. It’s distracting for them, but also motivating (I imagine).  I can never understand it when my clever and hardworking agency MD/founder peers bust a gut when someone from their team gets poached. I’m hardly above getting emotional about business (quite the opposite), but I always reckon that all an employer/manager can do is look after their people. What they do is up to them :)

So the recruitment space is heating up.

2. Mergers & Acquisitions are poised

The whole agency space is warming up. The guys doing social media agencies to sell out to the established agency ecosystem will probably succeed – I know personally and directly that big agencies and groups are actively opening conversations with the new boutique firms. The professional intermediaries like Results and Pembridge seem to be fairly sanguine and patient about the agency M&A market as a whole at the moment but are starting to build their networks and engagement with the new social media thing. I guess for those on the fence at corporate finance and deal-making advisory firms the Headshift deal will have catalysed that.

3. MeasurementCamp attendees have evolved

A different sort of input: a human one! :) Yay for humans.

When I started MeasurementCamp with the help of the nascent social media community about 18 months ago it was the pioneers with a lower case ‘P’ – the lovely smart and down to earth writers/talkers/thinkers that are interested by the new and who naturally were investing their time investigating new interesting stuff. Today we have more of a blend which still includes the super-thinker hardcore people but the archetypal (though thankfully we still have lots of diversity) MeasurementCamper is younger, much more likely to be part of an agency, and is working on live social media projects. The market exists. And thank the lawds, there’s some REAL talent there. Even just last week at MeasurementCamp London there were three or four new very smart young agency people in attendance. I predict inflated salaries and big ‘welcome to traditional agencyland – now socialmediafy the world, by tomorrow please’ jobs for them all.

4. Clients are hiring

This is great news I reckon. Perhaps the best bit of all for all of the real people in the world. At NixonMcInnes we try hard to not build relationships with our clients based on dependency but prefer to help our clients build their own capabilities to do the stuff they need to do. (We will do stuff for them – but over time we prefer that they learn to do it for themselves). And so we have helped in some way BMW, Channel 4 and now one of our other clients (I don’t think I am able to name them just yet) shape a role and/or find a person that can come on board and be part of the internal revolution inside client organisations to embrace and harness the social web. Good good!

So what next?

I try to stay away from predictions but if I’d say it’s pretty obvious what happens next:

  • Salaries will go up bubbliciously for the few genuinely capable social media professionals (regardless of their flavour and original background) for a while until supply starts to meet demand
  • Some of these people will end up in jobs they aren’t yet ready for – but that’s OK, it’s called ‘learning by doing’!
  • M&A will kick off in a big way in 2010, with big agencies buying small social media agencies for the next two or three years
  • Eventually everything in the agency ecosystem and in client communications and engagement will be normalised and go back to everyday-abnormal

Enjoy the ride between now and then. We plan to :P

This post was filed under Not for profit, Social media, The future Comments are currently closed.

3 Comments

  1. Hey Will

    Great stuff (and exciting times indeed).

    I’d agree in theory with most of this, but it’s possible the Dachis/Headshift deal was an outlier rather than the start of a trend (and let’s face it, neither would call themselves a social media agency, as we both would).

    However, on balance I’d agree with you. I can’t say I’m quite as sanguine about the recruitment situation, although as with you guys, no one has been tempted to leave us as yet, and in fact the trend is in the opposite direction for us:
    http://wearesocial.net/blog/2009/09/simon-social/

    I think and important factor in this for us, you and others like us is that we’ve built up strong, specialist teams and we’re collectively moving the start of the art forward, and that’s where people want to be. Not stuck on their own in a big faceless agency having to fight social media’s corner singlehanded.

    In fact it was reasons similar to this that kept digital agencies ahead of their above-the-line brethren for a good 10 years, despite the salaries they were offering.

    More of my thoughts around these issues here:
    http://wearesocial.net/blog/2009/05/great-game/

    Posted 14th September 2009 at 1:48 pm | Permalink
  2. Nice post Will.

    My view is that your points 3 and 4 are the most important things happening right now, as both point to the fact that this space is maturing.

    From an agency PoV (as I’ve rambled on elsewhere), it’s all about creating/building/delivering proper services and capabilities to match. MeasurementCamp is great for this – it’s an honest, grown up way of tooling up, learning and doing better things …and the good agencies/people are getting there fast. (And bravo, you.)

    From a services delivery 2010 PoV, internal resources and client hires are, I think, essential. Most bright sparks have realised that Social Media (and associated things) are for life, not just for Xmas. No good doing it as a tactical side show – doesn’t really work (and going tactical is a stupid thing for an agency to do/promise). So this means applying some budget and showing some commitment. It’s happening faster in some sectors than others, but – generally speaking – this stuff is not a neat fit for a predominantly outsourced play…. like, say, trad PR. It needs insiders doing lots of thinking/content/execution/etc…. and agency talent to help them do it smarter (and lead certain things). And so we’d better help them get there if we’re going to do good work together.

    In other words…

    No learning, no service models = no agency…. bye, bye.

    No internal hires/resources = no real, valuable play. But this is essential if firms are to get value from it all.

    Posted 14th September 2009 at 1:49 pm | Permalink
  3. Good points all of them!

    On recruiting, I think we’re going to see a steep recruitment learning curve both for recruitment agencies and corporates looking for ‘social people’. It’s a new field and often misrepresented online and that could result in some teething problems in the recruitment marketplace (especially as over eager agents try to place people asap).

    M&A will definitely pick up, particularly as larger agencies try to make a play in this area by buying up small consultancies rather than hiring in and building from the ground up.

    The way agencies adopt and adapt is going to be interesting as if you get social media wrong for your client you’re unlikely to retain them given the potential scale of fallout. Could be a tough learning curve for some!

    Posted 14th September 2009 at 4:46 pm | Permalink

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