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Digital marketing in the Midlands: have we got what it takes to become a leading part of the sector?


November sees the City hosting “The Big Debate” where various speakers will discuss and debate whether the region’s creative/digital sectors can lead the UK’s economic recovery. When it comes to the digital marketing sector this is a perfectly reasonable ambition. Spend on digital continues to grow with online ad spend outstripping TV for the first time this year. It is likely that this growth will continue in line with consumers’ increasing use of digital channels. So is our regional scene benefitting from this growth?

Our small agency scene in the Midlands is certainly thriving with plenty of digital agencies across the region as well as the high profile concentration of businesses in Birmingham’s Digbeth and Jewellery Quarters. There’s also the stampede into digital from the region’s established advertising, PR and design agencies all looking to tap into the growth of the digital sector.

The result (regionally at least) is a highly competitive sector with clients able to shop around. This seems to be having the unfortunate effect of creating an increasing element of price competition. The competition from traditional agencies who are making clever use of remuneration proposals to secure digital business from the pure-play digital shops is contributing to this.

This price sensitivity is a concern in the context of the region’s digital ambitions. Leading any economic recovery requires (or at least implies) a range of contributory factors – sector leadership, a large pool of highly skilled people and most importantly, solutions that command a premium in the market place attracting the best clients to the region (which in turn attracts the skilled workforce).

I’m not convinced that our digital sector is there yet. New Media Age has just published its annual guide to the Top 100 digital agencies who will generate revenues of almost £1 billion in 2009.  As you’d expect, most of these businesses are London based. However, there are a number of regional players with highly successful, growing businesses that are attracting national and international clients. Sadly, the Midlands isn’t one of these regions with only one agency, Leamington’s Freestyle Interactive making the top 100.

Other regions fare considerably better. Manchester (including the wider Cheshire area) has several agencies in the list. The superb Code Computerlove continue their growth with McCann Erickson’s Manchester digital operation making the list. There are also the digital teams at Cheshire’s Amaze and the Manchester arms of several other big digital players, e.g. Reading Room. There are also plenty of other exciting digital businesses outside the list including MagneticNorth.

Bristol has an equally successful scene with E3 making the list along with DMG, owners of Brisol’s InboxDMG and HyperlaunchDMG. Both of these agencies would make the list on their own (the combined revenue of the group puts them at number 5 on the list). Similar success is evident in other cities/regions where there is a mix of businesses of varying sizes.

The first thing we need to realise is that digital is strong everywhere and Birmingham is behind the curve and not ahead of it. Of course, Birmingham has some great agencies led by Clusta and Made Media. If we go further afield we can add the aforementioned Freestyle into the mix, Leicester’s Fuse, Xibis and Effect as well as growing digital teams at ad agencies Cogent and McCann Birmingham. Step into Staffordshire and there are the viral agencies Tamba and Koko.

Perhaps we also need to look outside of the City limits at what works and why in other regions. Manchester’s success in digital shows no signs of abating yet the region isn’t resting on its laurels. A recent NESTA report highlighted the challenges in continuing the economic growth from digital/creative industries. For a City that see’s its competitors as Barcelona or Milan, it shouldn’t come as a surprise that Manchester continues to harbour bold ambitions. It certainly shows an appreciation that economic success is an ongoing, moveable feast. Success yesterday is no guarantee of success tomorrow.

We also need to be looking at the best agencies in the market. Our ambitions should be to see Birmingham develop the next AKQA or Glue London (insert the agency you aspire to here). Digital is new and evolving so age is no barrier to success (and many in the top 100 are less than 10 years old). In the short term, the region needs to be attracting people from London and Manchester. That’s a tall order. To attract the talent, we need the clients, brands and work that attracts the workforce.

Shouting more loudly about our commercial successes is a prerequisite, an area the region fails miserably at compared to Manchester and others. This should be coupled with a greater commercial focus and that targets the premium end of the market. The recent Birmingham City Council website fiasco is a case in point. That the website was overpriced, under-developed and poorly executed has been widely debated elsewhere. The BCCDIY response despite scoring some technical points does our digital ambitions no favours either.

The answer to £2.8 million of badly spent digital investment isn’t a freebie knocked up by a group of mates in their spare time. Good intentions aside, it risks devaluing the commercial aspects of digital marketing. And these are absolutely vital if we’re to create a vibrant, successful, employment-generating digital marketing sector.

Of course, the BCCDIY has one positive – collaboration – and this will be critical to our chances of massively growing the region’s digital businesses. However, it needs to be commercially focussed collaboration where businesses partner up to fill gaps in skills or service to secure new contracts. There are plenty of skills and talents across the region’s digital agencies. Winning business from bigger competitors is possible by partnering with the right team. It’s irrelevant whose name is on the bills if it brings in the work. It’s also an approach that offers costs benefits (useful in the current climate) when pitching against these bigger agencies with larger headcounts.

Coupled with this is the need for a more competitive streak especially when pitching against our bigger Manchester, London and Bristol rivals. The recent news that Birmingham International Airport has appointed a Bristol agency absolutely rankles when there is abundant choice locally.  Maybe the first step is a  regional voice for digital that exists to drive awareness of the region’s capabilities. One reason for the success of Manchester and Bristol is their trade bodies. Bristol Media and Manchester Digital showcase the successes in and out of the region, help businesses find each other and speak as one voice over issues of importance to their respective regions. This is perhaps the area that we’re most lacking and something we should address if we’re serious about our digital future.

22 Comments leave one →
  1. 15/10/2009 4:16 pm


  2. 15/10/2009 4:26 pm

    “collaboration … needs to be commercially focussed collaboration”

    The power of individuals doing something because they care enough is huge. Money isn’t always the best driving force — and I realise that this doesn’t further commercial agendas as easily as other responses might.

    Of course the best solution would have been for BCC to pay for a good site, but helpful, collaborative, caring work is important and shows a maturity — something that would be difficult to demonstrate from commercial competitors.

  3. Joanna Geary permalink
    15/10/2009 4:49 pm

    This is a very interesting post.

    I think much of what you have said is true, but I’d point out two things that have become clear to me since I have left Birmingham.

    1. People in Birmingham spend far too much time worrying why they are not as good as Manchester and not what they are good at doing.

    2. That Birmingham is not commercially focused in some aspects of the digital and creative community is a MASSIVE STRENGTH and certainly not something to be eradicated.

    The strength of civic duty and atmosphere of participation is not something I’ve come across anywhere else and , if nurtured in the right way, could be the one of the things that Birmingham gains an international reputation in.

    • 16/10/2009 5:36 pm

      I like your point about civic duty/atmosphere of participation and the potential for Birmingham to develop a lead in these areas. However, can these not co-exist with a vibrant commercial sector? I’d argue that both are needed in a city of this size.

  4. 15/10/2009 5:03 pm

    Thanks for this. The region’s digital ambitions have always seemed confused to me and while it seems like Bristol and Manchester have got it sorted I’ve been ware of falling for the “grass is greener” mistake. Nice to get some meat on that from you.

    Regarding BCCDIY (which I’ve been watching, not getting involved with) I thibnk you’re right that it’s not an ideal response from the digital industry but I think that whatever Stef’s motivations for starting it it became more interesting than that when he turned it into a Wiki, moving it away from webdev and into a more social area. Or to put it another way, I’m sure the Encyclopedia Industry dismissed Wikipedia as “a freebie knocked up by a group of mates in their spare time.” I don’t think BCCDIY is the answer but it’s certainly opened a door to a potential answer to city-specific information dissemination.

    Back on topic, the notion that the “region’s creative/digital sectors can lead the UK’s economic recovery” is pretty laughable to me, not because it’s not good enough but because I think the idea of regions competing with each other is illusionist at best and damaging at worst. BHX went to a Bristol firm because they could. There’s no reason at all why they should keep the work local. If I’m buying stuff “digitally” I don’t care where it comes from. If Digital means Internet then geography is irrelevant. The beauty of the digital revolution is firms out in the regions can compete with London – why are we trying to lock things down into mini-Londons when we should be embracing this new level playing field?

    Caveat – I’m not really part of this industry and certainly don’t have the perspective you’ve shown in this post.

  5. 15/10/2009 5:44 pm

    I am one of the volunteers on BCCDIY. Having already spent £2.8 million, I doubt if BCC would have been willing to pay out any more to digital marketing agencies. So it’s BCCDIY or nothing I’m afraid.

    And the only benefit of BCCDIY is collaboration? What about the benefit to the citizens of Birmingham (the whole reason why we are doing it)?

    It would be wonderful to have the support of some of you digital marketing agency guys (there’s still time). Some things are more important than money.

  6. 15/10/2009 6:19 pm

    If “The answer to £2.8 million of badly spent digital investment isn’t a freebie knocked up by a group of mates in their spare time” what is it then? And could you be any more patronising?

  7. Robert Sharl permalink
    15/10/2009 6:58 pm

    A minor point, but bear in mind that the head of design at Glue London was educated here in Birmingham at BIAD (Visual Communication BA (Hons) First Class. There’s more than one way in which cities contribute to the national/global digital economy. We might ask some questions about why our graduates move away, but that’s a different issue.

  8. 15/10/2009 7:14 pm

    I’ve just come from a social media surgery – volunteers working with community groups to show them how to make good use of the web. It too is a collaboration and helps create a patchwork quilt of online activity which fertilises the ground in which your business grows it’s profitability.

    This evening we were visited by someone from Yorkshire (who was there on behalf of Microsoft) and someone from Barcelona – both admiring of the civicly active online movement in Birmingham.

    The national/international reputation the city gains from activity such as this, big city talk and bccdiy is clearly good for your business.

    Come along and help if you like.

    • 16/10/2009 5:42 pm

      Thanks for the thoughts. I’m not (I hope) knocking the non-commercial side at all merely trying to suggest that our commercial sector needs to raise its game and promote itself more aggressively. As per the reply to Joanna’s comment above, I think there’s room for both a vibrant civic and a commercial digital scene in the Midlands.

      Re: coming along to a social media surgery – I’ll certainly come along and get involved.

      • 17/10/2009 10:58 am

        Wonderful. I’ll make sure I let you know about the next one. The volunteer constructive activism is – ultimately – a commerical thing. Often the motivation is not commercial, but the end result is knowledge and skills that have value. Your aims and our our mutually supportive.

  9. 15/10/2009 7:59 pm

    I’ve re-read this a few times now. Really interesting points being made:

    There’s a move into digital marketing by traditional agencies.
    That’s squeezing prices.
    ‘Digital’ is a focus for growing the regional economy.
    Stuff like BCCDIY interferes with the market.

    I do hope these points are made at the Big Debate, love to hear what Leadbetter would make of a position that points out that his idea of ‘We-Think’ might mean people lose their jobs.

    Which of course they will. In fact BCCDIY, for all its civic good is a clear demonstration to the City that more careful consideration when procuring IT services can save money. And therefore people, those largely Birmingham-based people upon whom some of the £2.8m was spent, will loose their jobs. And the public sector, heading for a financial meltdown of its own is desperate to shed jobs. So BCCDIY has shown the public sector how to save costs and cut jobs.

    So BCCDIY is more an attack on how ‘big’ IT solutions are mishandled in the public sector. The work that the agencies you cite above do are about cool design and innovative digital solutions for clients with a lot more sense than the City council. But I can see how BCCDIY must wind an agency up although in some ways it’s nothing more than a group of freelancers showing off their skills – belying the argument that it’s a lack of skills that holds this sector back. I always worry slightly about projects that exists to show up mis-management in the public sector – it’s all a bit Daily Mail to me. However in BCCDIY there’s value in the approach and in the outcome – plus it’s distinct, it’s not just slavishly following what other cities are doing. I’m excited about it because I can see how it can shift the public sector to valuing bottom-up approaches to their often poorly executed top down ones. Plus, Brummies have a tradition of agitating, long may it continue.

    But jobs do need to come from the digital sector. Proper jobs, in growing businesses, with graduates, trainees, receptionists and cleaners. There’s actually been a regional focus on ‘digital’ since about 2003 (in a focused way at least). If it’s not paying off according to reports such as the one you cite then that’s because it’s only 2009. It takes longer than that to shift a regional economy around. We’re 18 months (I think) into 4IP and Screen WM’s £10m investment to try to accelerate the region’s digital economy. That, in time, has to show some impact by way of jobs and business growth. Some of the innovations they seem keen to support strike me as being at the BCCDIY end of the market so it might be worth asking if they are the right kind of investments for established, commercially focused agencies. Are they too focused on public service solutions? ‘social/civic good’ solutions? Will the outcomes be great for democracy and a bit of profile but not so great for companies like yours and the region’s.

    Those are the key questions I think – ones I’m looking forward to hearing on November 2nd. Great post.

  10. 15/10/2009 8:21 pm

    Interesting article, and it seems to have sparked some twitter conversation – whilst I agree with many of your points, as one of the originators of the BCCDIY project I’d like a little bit more from you on why you think that the project could potentially risk “devaluing the commercial aspects of digital marketing”.

    The project is an open source approach to designing a city council website using a user-centred philosophy.

    I would say that having a strong open-source community adopting that thinking in a city is a good thing.

    This blog itself is built on the open source WordPress platform, which was put together by Matt Mullenweg and an army of volunteers. On one hand you could say that releasing an easy to use blogging platform harmed the industry – businesses at that point were building their own commercial systems and subsequently lost clients and saw budgets reduce.

    On the other it is easier to argue that systems like WordPress offer a set of tools that enable commercial activity built on them, create jobs, and expand the numbers of people who use digital media tools, and thus leading to higher demand for digital services like marketing.

    Suggesting that BCCDIY is bad for the industry because of its open source ethos certainly sounds a little protectionist, as if pointing out that there are easy ways to achieve functionality that is good from a user’s point of view is a bad thing, because jobs will be lost. I’m hoping that’s not what you’re suggesting.

    If you’re viewing BCCDIY through purely monetary ‘value’ (discounting the idea that if in some ways it’s better than the original then it must be worth more), we came up with a very rough estimate of person-hours put into the project over the two weeks it was created, and came out with a figure of £38,000 of equivalent agency hours, should the work have had a client to send a bill to. (I estimate ‘rough’).

    I agree with Jo and think that viewing the project as a stand-alone outside of the community of people who got involved risks devaluing one of Birmingham’s unique selling points – that collaborative instinct combined with a supportive environment.

    I would also most certainly hope that just the act of volunteering one’s time for a few hours for a project that one believes in is not something to be discouraged because it might potentially devalue the work of others.

    Here’s a quote from Tim Berners Lee on how governments should be using the web, and is more than a little one of the inspirations for BCCDIY – link:

    Government data is being put online to increase accountability, contribute valuable information about the world, and to enable government, the country, and the world to function more efficiently. All of these purposes are served by putting the information on the Web as Linked Data. Start with the “low-hanging fruit”. Whatever else, the raw data should be made available as soon as possible. Preferably, it should be put up as Linked Data. As a third priority, it should be linked to other sources. As a lower priority, nice user interfaces should be made to it — if interested communities outside government have not already done it.

    Please note the last part of that quote – interested communities. BCCDIY is at the front of what I think will be a change in the way that we use/reuse government data and information.

    Viewing BCCDIY purely through the lens of digital marketing misses the point – this isn’t about a good looking website that markets something – this is about what we as citizens of a city expect from our local government through the web to enable us to interact with the city’s services and information in ways that suit our needs.

  11. 16/10/2009 7:58 am

    we came up with a very rough estimate of person-hours put into the project over the two weeks it was created, and came out with a figure of £38,000 of equivalent agency hours, should the work have had a client to send a bill to.

    It’s fascinating you did that. But if you believe in opportunity cost (like I do), that means £38,000 of taxable turnover has literally taken out of the commercial digital market in Birmingham to date. That’s unless the freelancers and developers had no paid work on. We all like open source, but that doesn’t mean expertise should be free.

    I think we all commend the effort and sense of collaboration evidenced by BCCDIY, but some feel that Birmingham is in danger of measuring digital success in conferences, blog posts and grant applications rather than tax revenue and jobs. Jason’s post is simply a plea for those of us that operate commercially to celebrate our contribution, and to be more ambitious.

    By the way — if you’ve ever taken money from a client to help them communicate what they do better online, you are in the industry.

  12. 16/10/2009 10:58 am

    B…b…but Jake, I don’t wanna be in “digital marketing”. Please don’t make me be in “digital marketing”!

    • 16/10/2009 11:09 am

      @pete Too late 🙂 You absolutely have to buy a BMW M3 and shout into your phone in public too.

  13. 16/10/2009 11:58 am

    Thanks Clarity folks – very interesting post and discussion.

    As someone who has worked in all the places you mention – and advised many of the powers that be in the local authorities and funders in these places in relation to investing in the digital industries – I agree largely with your view on the state of the Midlands.

    Whilst the community itself is skilled and empowered (as the wonderful BCCDIY atests) the industry proper is woefully lacking behind those in other, smaller cities.

    Industry groups like those you mention (Manchester Digital and Bristol Media) are motored by loud-mouthed individuals with something to say at a national level and invest their own time and passion to encourage schemes and opportunities to profile, showcase and raise investment in local business to create more jobs in digital and a sustainable industry. Because what’s good for the city, they know, is good for the growth of their own business.

    Interesting you don’t mention Nottingham – I’ve lived here for a while and there have been and continue to be a lot of good sizeable digital agencies delivering national work here including Chemistry, Together, Souk, Linneys, Jupiter, Internova – plus a plethora of smaller, more creative players. I don’t know why – there’s no public sector support or initiative, no special university courses, and no one shouts about it. They’re just here and they get on and do it, and as they’re here, there’s plenty of talent around too to meet their growing needs.

    The lack of serious players in marketing, advertising and digital in Birmingham is a serious concern – but one hard to change by policy makers alone.
    Bristol conversely has a great digital/tv scene, but lacks the hearty chunk of games/IT developers the West and East Midlands regions flourish with.

    I guess in both cases the big success story isn’t there to cluster around – to generate spin-outs and suppliers to, which is how an industry starts to form.

    The arguments about skills, career progression, graduate retention, civic pride, lack of effective public intervention are…sorry to say…discussions I have almost verbartim with businesses in every city outside of London. The grass is greener everywhere.

    I do believe cities should go with their grain and celebrate what they are good at. In Birmingham I would see this as pureplay creativity – arts, culture and the strong social media and civic digital culture which is barely scratched upon elsewhere.

    How does a commercial agency exploit this? I don’t know, but association with or sponsorship of, doesn’t seem to be a bad place to start.

    There’s plenty of public investment in all things in digital – so the commercial players need to be shouting for a bigger piece of the pie. Or working out what they actually want to see in the pie and how investment or advocacy could help them grow.

  14. Ben Neal permalink
    16/10/2009 12:17 pm

    Thumbs up. Good read 🙂 Tired so no more to mention

  15. 30/12/2009 11:39 am

    I’m a little behind the times on this story, but these comments raise some interesting points. I used to work for a large multinational, working in a local council near to Birmingham – doing IT project management until fairly recently – and no I wasn’t made redundant – I left of my own accord.
    The major problem with all government work comes down the contract. I frequently had major issues caused by a poorly written contract that was signed by both sides – just to get the deal going. This led to poor requirements defination and lack of direction when it came to business and process transformation.
    Apply this to the BCC website and also the DIY project they will both suffer from the same issues. The proper website didn’t take into account what people actually wanted – and tried to hard to be bells and whistles to all – missing key features. The DIY project – although well meaning, will in essence be missing the gap it’s trying to fill – as it will not have the necessary links into the backend systems used by the council to provide services such as payments-online, submission of e-forms etc etc.
    Stef makes a good point about WordPress – however, from my experience, wordpess would still require a lot of work to integrate it’s framework into a seemless looking council website that the general public would expect to see – as it is – the DIY project looks like what it is – something that has seeming grown organically – and it looks like it. It’s certainly doesn’t have a corporate look that I would expect as a tax payer.

    In terms of the costs associated with the project – £38K of billable hours… all seems grand – but where and what controls were in place? Requirements list etc etc, proper controls in terms of development? Taking those into account will greatly increase the costs… and are which a vital component of any development.

    At the end of the day, the BCCDIY project has not really taken anything from commercial work – due to the points I’ve made above – good web developers that can fit into a dev team will still get corporate development work – and good digitial artists and designers who can interpret requirements and develop and work to a project plan with other groups will still get work with large organisations who have the finance and the skills to develop something the size of a council website. Mash-ups and community projects have their places – unfortunately from my perspective – they are not yet ready or able to compete with the corporate approach in the marketplace. Though I will say that in 5 years time, maybe BCCDIY will be a viable altenative that could handle the demands of 750,000ish tax payers in the Birmingham region. At the moment – it’s a woeful sticking plaster – but that’s a reason to stop the community effort.

    • 30/12/2009 11:43 am

      should have ended with “but that’s not a reason to stop the community effort”


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