Revolutionizing the Advertising Landscape: Unveiling Mekanism’s CEO's Game-Changing Strategy for Future-Proofing the Agency

The barrier between brand and performance marketing has led to significant changes in agencies, with a shift towards data-oriented work alongside traditional creative focus. This new approach has resulted in a larger share of growth for the industry. Mekanism is one agency brand that has embraced this transformation by offering full-funnel solutions that combine the "soul" of marketing with science, according to CEO Jason Harris.

Mekanism experienced a change in its ownership last year when it was acquired by Plus Company, a privately held ad network in Canada. As part of this acquisition, Mekanism's presence in the United States has expanded from its initial base in San Francisco to include offices in Chicago, New York, Los Angeles, and Chicago. Despite the challenges faced by the advertising market and the slowdown in mergers and acquisitions, Mekanism has remained active and has even expanded its international presence. Notable account wins in 2023 include Harmless Harvest, Fossil, and The Wine Group.

Mekanism Co-founder and CEO Jason Harris. 

Retrieved from Plus Company on July 11, 2022

Mekanism acquired the Madrid-based design firm Zapiens in September with the support of Plus Company. Additionally, Mekanism is utilizing Plus Company's new predictive intelligence solution, called Plus AIOS, to enhance mixed media modeling and measurement. Early client testers have seen a 29% decrease in cost-per-conversion and a 23% improvement in campaign efficiency, resulting in optimization of approximately $2 billion in media spend.

During Advertising Week New York, our Website interviewed Harris to delve into the Plus Company deal, the reasons behind the Zapiens acquisition, and his positive outlook for 2024.

Content has been edited for clarity and brevity. The progress on achieving a full-funnel offering after the Plus Company acquisition has been significant. Can you discuss the development within the past few years?

JASON HARRIS: Our recent update to our positioning has been really successful. We remain committed to soul and science as our core values. Soul represents our well-known expertise in long-term brand-building, while science encompasses our new services, such as always-on digital experiences, one-to-one marketing, loyalty programs, and CRM. Our modern creative agency now offers a comprehensive solution for driving business growth. 

In today's market, marketing budgets are closely scrutinized. It is essential to demonstrate the value of every dollar spent. By rapidly incorporating lower-funnel services, we have achieved numerous successes. CMOs now face numerous challenges and seek agencies that can provide comprehensive solutions. They prefer to work with a single agency rather than managing multiple partners. In the competitive agency landscape, focusing solely on brand-building skills without offering these additional services may make it difficult to win new business opportunities.

At Advertising Week, there seems to be a growing consensus that the divide between brand and performance is diminishing. It is crucial for performance agencies to bridge this gap and convince clients that they are capable of both lower-funnel work and brand-building. We, too, have recognized this shift and are determined to demonstrate our ability to drive short-term business growth for our clients.

The Plus Company made a significant investment in developing a comprehensive measurement platform called Plus AIOS, which stands for All In One System. This platform integrates predictive intelligence to assist CMOs in effectively planning, optimizing, and evaluating campaigns. It enables CMOs to comprehend the value of their expenditure and predict the most suitable allocation of funds, along with the anticipated outcomes. Without the acquisition, we would have been considerably behind our desired position, and the construction of this system would have required a significant financial investment.

Regarding our website, it seems that the Plus Company deal was secured just in time.

HARRIS: A deal cannot be made at this time due to the high cost of borrowing money. It is crucial to have a clear understanding of the process when undergoing an acquisition. Without a strong focus on growth, the process is bound to be challenging as there will always be the integration of different cultures.

In our case, we made the decision at the right moment. Once we overcame the internal obstacles of selling and explaining the reasons behind the acquisition, it has proven to be beneficial. It has allowed our team to future-proof their skills. If they only focus on brand-building without learning about the digital aspects of the lower-funnel, their opportunities may be limited, whether they choose to remain at Mekanism or move elsewhere.

Our Website: Can you talk about the process behind the Zapiens acquisition?

HARRIS: The idea of acquiring agencies wasn't on our radar until we finalized the Plus Company deal. Once that was settled, we began exploring options for smaller, near-shore companies that specialized in digital expertise. What stood out to me about Zapiens was their exceptional design skills. They excelled in UI/UX, while also maintaining a strong focus on digital capabilities. We visited their offices multiple times, had meaningful discussions, and quickly realized that our company cultures would align perfectly.

We're currently exploring potential synergies in terms of client acquisition, business growth, and service sales, as we are new to it. Additionally, it is worth noting that our website indicates their presence in Madrid. Is this expansion into international markets?

HARRIS: It's a new experience for us. The United States is known for its high cost of living, which was one factor. However, what really attracted us to them was their exceptional design. European designers have a keen eye for detail. It was a combination of new services, affordability, and quality products, which made it a perfect trifecta.

Our Website: In general, it has been a challenging year. How did you successfully acquire new clients?

HARRIS: In Q4, I've observed a noticeable change in the usual trend of organic growth and increased spending by clients. This year, that trend has significantly decreased, something I haven't seen in about ten years.

There are a few things happening concurrently. Our clients remain loyal, but they are not investing additional funds. On the other hand, there is a surge in new business opportunities and pitches during Q4. However, despite this increase, there is a decline in organic spending. This suggests that clients are reducing their current spending and using Q4 to explore new resources and potential partners for the year 2024.

I anticipate that 2024 will be a significant year, and my outlook is optimistic. However, it has been a challenging year with a notable increase in interest rates, making it increasingly difficult to secure loans. Ultimately, this will hinder M&A activity and impede company growth, thereby necessitating a boost in the economy.

Considering the possibility of a slight ease in the situation, I am curious about the specific areas in which you would manifest interest for investment or acquisition on our website?

HARRIS: We have a solid media group, but we need to improve our expertise in performance media. Now that we've established ourselves in digital experience and lower-funnel work, it's time to enhance our media capabilities with a focus on performance. This will be our next priority once we have some breathing room.