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Picking Partners for Overseas Growth

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Smart strategies for signing partner agencies when it’s time to take your tech company global.

You’re the CMO of a Silicon Valley-based tech company, and you’re out with a friend at The Dutch Goose in Menlo Park for a beer, as you’ve just closed your series B financing and are in the mood to celebrate. Your friend runs marketing for a tech company that’s further along — it has just filed its IPO paperwork, in fact — and on your second pint of Anchor Steam, you begin to talk shop.

“Hamelin Labs is killing it in the U.S.,” your friend says. “Now that you’ve raised a new round, you have to be thinking about overseas expansion. You’re soon going to have launches to manage in multiple countries. Have you nailed down your agency strategy yet?”

Sound familiar? When you reach this crossroads, it’s important to think carefully about how to proceed, as the paths you could follow are different from one another, and once you head down one of them, it can be painful and time consuming to make a change later. So, what are your options?

Source: used under CC license.

The global firm

The allure of the global firm is the promise that a single agency can represent you in whatever markets you pursue. Entering Germany? Your global firm has an office in Berlin. Expanding into China? The global agency has offices in both Beijing and Shanghai.

In picking a global firm, you could select a generalist with broad mandates that include tech practice groups. Or, you could pick a tech specialist.

The global agency feels like the convenient choice. You get a single bill. You get unified measurement and reporting. And when it’s time to move into a new region, you don’t have to run an RFP to find a new PR partner.

The principal problem with this model, however, is that talent can vary widely from office to office with a global firm. The agency’s Mexico City team may be fantastic. But its Bogota team could be lousy … and now you’re stuck with them. Given that team quality is so critical to success in marketing and PR, it seems unwise — even dangerous — to just roll with a global agency’s default crew when entering a new region.

The other challenge is cost. If you have a million dollars a year to spend on PR, global firms will give you plenty of love. But that’s not a realistic PR budget for an emerging technology company. And if your budget is modest, you may end up with a global firm’s “B team” (if it’ll take your business at all).

Best of breed: the DIY model

An alternative to signing a global agency is to go with the “best of breed.” In this scenario, you are hiring the very best agency partner you can find in each market you enter. And under the “DIY model,” you’ll then manage these agencies yourself.

Let’s be clear: This path takes work. You’ll need to invest in identifying, onboarding and managing strong agencies in your target geographies. You’ll have to coordinate their activities to make sure they’re executing according to your overarching global PR plan. You’ll need to work with them on measurement and reporting so that you can roll up results in a unified fashion. And you’ll have to deal with budgets and bills from multiple vendors.

But if you’re willing to put in the effort described above, the outcome can be outstanding. You get access to top-notch PR talent and the results that talent can deliver for you. If a team isn’t performing to your standards in a particular market, you can swap agencies in the region without causing problems throughout your agency portfolio.

If you follow this path, make sure you hire the right internal staff to deftly manage the global network of firms you’ll build. Your best bet is to bring on team members who have worked both for agencies and for other tech companies. This way, they’ll have a detailed understanding of how agency life works and can manage your agency partners most effectively.

Best of breed: centralized control

In this scenario, once again you’re hiring the very best agencies you can afford in the different markets you are targeting. The variation on the theme, however, is that with the centralized control model, you appoint a single agency as the coordinating firm. You work closely with this lead agency to set strategy. The lead agency, in turn, handles the day-to-day interaction with the regional agencies. It also coordinates things like measurement and billing.

This hybrid approach is a compelling one. You retain the ability to hire the best possible talent in each market. But you outsource the operational complexities of managing these disparate agencies to a single coordinating firm.

Yes, this model does come with some extra costs to cover the fees of that coordinating agency. But doing so will also reduce your stress substantially and enable you and your staff members to devote more of your bandwidth to other facets of your jobs. I liken this approach to hiring a general contractor to help you remodel your house. Yes, you could run such a job yourself, hiring and managing subcontractors directly to help you with everything from framing to roofing to painting. But hiring a GC substantially reduces the time that you need to devote to remodel logistics, freeing you up to tackle life’s myriad other tasks.

Next steps

When it’s time to make this choice on behalf of your growing tech company, do your homework. Talk to industry friends who have been through this stage in their company’s growth to understand which path they chose, what worked for them and what they wished they had done differently. Talk with your marketing-savvy venture investors about what other companies in their portfolio have done — and how those choices panned out. And be sure to interview firms of different stripes to hear their pitches.

With good information, you can make an informed choice — and on your path to world domination, this is an important one.

This post originally appeared in O’Dwyer’s PR Magazine’s November 2017 Technology PR issue, on page 20.

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