How Deloitte Plans to Grow Marketing Arm Deloitte Digital, Rival Accenture
Deloitte is now seen as Accenture's equal
Consultants want to get close to CMOs as their responsibilities have expanded to include nearly every aspect of the customer experience, from ecommerce activation to research and development.
"Management consultancies and digital agencies are converging around a common set of services that are most in demand by CMOs," said Gartner VP, analyst Jay Wilson.
That puts consultancies in competition with each other and also ad giants like WPP, where their established relationships with big brands' CEOs and heads of technology give them a leg up, Wilson said.
The former Deloitte exec described the firm's strategy for pitching an insurance company.
"We take someone who knows insurance, not advertising, and deliver him to the CEO. Then he convinces the CEO and CMO to hire [Deloitte Digital] as well," this person said. "No ad agency on Earth can do that."
Deloitte's marketing operations are perceived as lagging those of Accenture, which entered the space three years earlier and promoted a big industry personality in Droga5 founder David Droga to run Accenture Interactive.
But Deloitte and Accenture are now seen as equals in the marketing space. Gartner promoted Deloitte from "challenger" to "leader" alongside Accenture in its most recent market report, citing its ability to handle global campaigns.
What Deloitte Digital could acquire next
SEC regulations prohibit auditors from doing business with companies they audit, which has prevented Deloitte Digital from entering the lucrative ad-buying business and hobbled its ability to compete with Accenture, which doesn't do auditing. Execs said Deloitte has approached the SEC more than once about revising these rules with no success.
Yet experts see Deloitte Digital doing more deals. Chris Karl, chief business development officer at M&A advisory firm JEGI Clarity, predicted it would make more big marketing acquisitions in areas like performance marketing and customer loyalty services.
Deloitte Digital has recently considered acquiring companies that have tech services like AI and machine learning that can help it develop cloud infrastructure and cybersecurity services for clients, said Michael Seidler, CEO of M&A firm Madison Alley, which advised Deloitte Digital on its 2016 acquisition of Heat.
Seidler said Deloitte Digital may also look to acquire social impact agencies to build on Ethos, a practice it launched in 2021 to help companies address issues like climate change and racial inequality.