Why commercial production companies need to start thinking about how they are structured

Alex Vero
Alex Vero
Jul 24, 2017 · 2 min read
Photo by Gerome Viavant on Unsplash

As the agency and production landscape continues to fragment, so do the structures in which we’ve traditionally operated in. It’s an unprecedented time in the industry with Publicis CEO Arthur Sadoun predicting that the industry will change more in the next 5 years then it’s changed in the last 20. Since Cannes this year there has been a huge increase in the number of in-house brand and agency teams coming to Movidiam looking for a more flexible approach to production. We’ve also seen a whole host of savvy marketing directors (often ex-agency) looking for agile production companies with creative capabilities. In doing so they’ve avoided the often expensive and time-consuming process of working with large creative agencies and the more established production companies.

The people benefiting most from these changes in the industry are experienced producers who have set up hybrid ‘creative production companies’ or diversified from their existing model.They’re not worried about how big their roster of directors is and can quickly build and disband teams on a project-by-project basis. They’ve got flexible staff bills and structures, and more freedom outside of high-cost city center overheads.
They also bring a much more progressive approach to how they operate and who they work with. They hire top creative and strategic teams on day rates who are in between agency assignments and work with directors from other countries who are not exclusively signed in their country.

The most important thing is that they understand their client’s objectives, are data and insight driven, and work closely with them to deliver work that really makes a difference, not just looks nice. They are makers with a business outlook, a fusion of craft and entrepreneurialism.

While there is no doubt that agencies and production companies do outstanding work, how many big clients will continue to operate with the type of budgets they’ve been accustomed to? This week Unilever CFO Graeme Pitkethly announced that they had reduced its agency fees by 17% in the first half of the year, while the average cost of a film was down 14%.

Established production companies are starting to recognize the need to diversify their offering. One recent example is Independent and Aardman joining forces to offer a combined live action and animated video offer — specifically for clients with tight budgets.

Regardless of what model or structure you operate on, what is clear is that things are changing extremely quickly and Arthur Sadoun’s prediction might well prove to be on the conservative side.

www.movidiam.com is a professional creative network and project management application that supports brands, agencies, production companies and freelancers to create the best possible work together.

I'm a filmmaker, producer and co-founder at Movidiam

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