The Insider Series: Charting New Courses with Andrew Davis

By | November 19, 2012
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This post is part of the Insider Series, which is designed to feature professionals in our industry, offer business insight and discover new paths in the agency world.

Andrew DavisAndrew Davis (@TPLDrew) started his career in media, as a television producer and later as a production manager for the Muppets.

Drawing on these experiences, he founded TippingPoint Labs, a content marketing agency, with his partner Jim Cosco (@james_cosco) in 2001. He’s spent the past 11 years as chief strategy officer, until he recently retired and sold his share in the firm.

Andrew is the author of Brandscaping: Unleashing the Power of Partnerships, in which he defines a process to bring like-minded brands together to create content. He is also an energetic, and highly sought after, speaker.

Below he shares his perspectives on agency management and succession, and the future of the industry.

Q&A with Andrew Davis

MAI: Can you give us a little insight into your background, and what led you to found Tippingpoint Labs in 2001?

Andrew: Jim Cosco and I founded TippingPoint Labs in 2001 after spending most of our careers in the television and film business. At the time, we both felt like we could leverage our experience creating television news and entertainment programming in the corporate market.

Instead of producing overly-scripted customer testimonials, we believed that telling authentic stories about how a company's products or services actually made a difference in their consumer's lives would be more compelling and effective. We were right. Over the next 11 years, Jim and I focused on telling great stories.

MAI: What were the biggest challenges that you and co-founder Jim Cosco faced when scaling your agency? How did you overcome them?

Andrew: Scaling an agency is never easy. In fact, I don't think we ever figured it out. Look, we are all in the service business. The quality of service we offer is only as good as the people we hire, train, and retain. That means if you're going to scale effectively, you're going to have to focus on building a hiring-and-firing strategy that's focused on attracting the best talent you can afford.

In addition, I believe you need to build a real practice. By that I mean, you need to have a documented philosophy that the entire organization operates on, with, and for. Your practice needs to evolve constantly and be spearheaded by someone willing to take charge of building the practice. Otherwise, you just have a bunch of people doing whatever they can to make the client happy. That's not a business, it's a bunch of people running a client retention business. 

MAI: In your book, Brandscaping, you write a lot about the paradigm shifts in marketing. Can you touch on the evolution of the marketing industry, and what this means for agencies?

Andrew: At Tippingpoint Labs, we never had a documented process. We had a set of guiding philosophies loosely communicated and implemented by only a few. My latest book, Brandscaping: Unleashing the Power of Partnerships, is the closest thing we have to a documented practice. 

The marketing business, and agencies specifically, are evolving rapidly. We are seeing an increase in competition from traditional publishers who are diversifying their revenue streams by offering marketing services powered by, and differentiated from, the traditional agency through the power of their audience.

These publishers are masterful content creators, and they are able to charge a premium for the services they offer by leveraging their market research, existing distribution platforms, and even the talent from their editorial teams.

Every agency seems to be offering the exact same set of services. Competition is fierce; specialization is non existent. Everyone says they provide SEO, creative services, social, content creation, video production, digital development, app creation… blah, blah, blah.

I believe the next five years are going to be really rough for the traditional agency model. We will see increased competition not just from publishers but from television networks, new media platforms, talent agencies, and even individual content creators — who are all leveraging their audiences to build powerful branded content platforms for underwriters interested in building "content brands," instead of "branded content." I believe that the future of all media is branded. Think soap operas of the 1920s.

That being said, agencies that focus on building content brands they own will gain market share, differentiate their services, and build corporate fiscal value not tied to directly to their service business. 

MAI: What is “brandscaping,” and how can agencies turn content into an asset for both themselves and their clients?

Andrew: Brandscaping is the art and science of building content brands powered by authentic, undiscovered talent. I believe this just might be the key to successful agency revenue over the long term.

Marketing agencies will look more like publishers — owning an audience and creating valuable content. They'll look more like talent agencies, finding, growing and building digital talent to help their clients sell more. They'll build value for their company not through the services they offer and their book of accounts alone, but the value of the media brands they build and own.

MAI: After 11 years as the chief strategy officer at Tippingpoint Labs, you recently sold your agency and retired. What were the driving factors behind this decision?

Andrew: Tippingpoint Labs, by all accounts, is a successful business. So, you ask a great question. Why would I sell my share in a successful, and still growing, business? There are a few main reasons. 

First, on the personal front, building — and then running — an agency is exhausting. (I’m sure you know that already.) On top of that, speaking about 50 times a year, traveling 180,000 miles, and writing a book can wipe you out. I was ready to relax. 

Second, the market timing is right. With the changes in the industry already mentioned above, I wanted to take some time off to figure out what the agency of the future will look like. All the pieces are there. The trends are in motion. But, I don’t have the exact formula yet.

Over the last decade, we had re-invented Tippingpoint Labs a number of times. I knew that if I kept slogging away, growing Tippingpoint Labs without re-thinking the marketplace, we might not continue to be as successful in the long term. And, more importantly, if I was wrong, I might be sacrificing good business for bad.  

Third, and finally, running a service business without building or owning any intellectual property started to make less-and-less sense to me, personally. For the time and energy we agency executives invest and expend, it seems as though we could build something of value outside our book of accounts and the staff we rely on to serve them. In my next chapter, whatever that might be (and I’m in no hurry), I want to build a business that builds some form of intellectual capital that could be worth more than the value of the assets that built it.

In short, I decided to sell Tippingpoint Labs because the timing was right, the market is changing, and the opportunity arose to start something new.

MAI: What tips do you have for other agency leaders in regard to succession planning and exit strategies?

Andrew: It's never too early to build an exit strategy for your agency, even if you can't imagine ever leaving. The truth is, thinking about how you're going to sell your company — and (this is important) who you're going to sell it to — will help you focus on growing the business in ways that actually add value, instead of growing anyway you can. 

MAI: What’s the best advice you ever received as an agency professional? 

Andrew: The best agency advice I ever received was: "Stop being a cog. Build a system." The more I reflect on my time as an agency executive, the more I realize that we spent to much time building too many cogs that never coalesced as a real system.

If I was to start all over again, I would have documented everything and invested in building a methodology (a practice) that was bigger than the people who executed it. Measure your ROE (return on energy). I think you’ll find you spend too much time turning small cogs with little return on energy. Build a system where you crank the big cog and the rest of the cogs automatically do the work.

Andrew Davis is the author of Brandscaping. Connect with him on LinkedIn or Twitter.