Consultancies often get called agencies, and agencies often want to behave more like consultancies, so what’s the real difference between the two?
It ultimately boils down to 3 things that set the two types of businesses apart:-
1. What they deliver
For agencies, this is commonly implementation (e.g. a pack design, advertising, digital or media plan). Whereas consultancies focus at the strategic level – building businesses and brands for long term health, and often commoditising the execution.
2. Their level of influence
Consultants are usually held as trusted advisors who have senior level cross-discipline experience. They will build a broad view of a client’s business and its strategic challenges to get to the nub of solving broader business problems. With this comes the ability for them to operate at senior levels, speaking the language of the ‘C’ suite.
A good agency on the other hand will have expertise in a specific field (e.g. creatives that come up with great brand building ideas). They will typically establish a credible reputation in their discipline – for example, social media. But they will probably rarely be asked to comment or provide consultancy outside of their immediate area of expertise
3. The team
Agencies have a raft of roles and therefore hierarchies within their business. Clients will deal with different people with varying degrees of experience and seniority. For an agency business model to succeed, they need to drive efficiency. This means they also have fairly rigorous processes that the client inadvertently needs to adhere to. The bureaucracy and inflexibility that this can cause can be quite frustrating to clients who need things yesterday!
With a consultancy, your primary point of contact is usually the consultant themselves. There is usually little organisational structure to contend with below them. The approaches tend to be bespoke to the client’s needs and business challenge, so there are no protracted processes to be adhered to. Therefore speed and efficiency are rarely a concern.
There is an obvious implication of this structuring; you pay more (per hour) for a consultancy (senior people, bespoke approaches) than you would for the services of an agency (mixed experience levels, sausage machine approach).