I’ve spent a lot of time in small and mid-sized agencies that don’t seem to grow. I’m not sure whether that’s because of a lack of a management ambition, lackluster work, or a stale business model. So I was intrigued to visit Seattle’s Rational Interaction, which has grown from 5 employees to 70 in less than five years, making it on the Puget Sound Business Journal’s 100 Fastest-Growing Private Companies for two years in a row.
So what’s the key to growing an agency business these days? Rational Interaction may have the formula.
The name Rational Interaction doesn’t scream “advertising agency,” but perhaps that’s on purpose. As co-founder Selina Petosa told me, “We approach everything with a strategic business mind.” It’s true. Petosa, along with co-founder Joseph Debons, started the agency with the belief there was a big gap between the desire for high-level strategy and the typical agency process. As Debons said, “Many agencies simply weren’t putting it all together, there was a lack of strategy and no focus on the business value of creative work.”
By pursuing consultative assignments at a high level, Rational Interaction has basically reversed the “let’s tack on a digital agency” approach well-known consulting firms like Deloitte have taken. And it’s worked. Nearly 40% of RI’s revenue comes from consulting-only engagements.
But with the co-founders’ agency-side and creative backgrounds, Rational knows how to do great creative work based on the strategic thinking they recommend. As Debons put it, “We’re already steeped in the client’s business. If clients need us to consult with other agencies and tell them more about the client’s business situation, fine. But yes, we know how to execute as well.” In a world where marketers are more confused than ever, that’s a powerful sales pitch for an agency to make.
So in just a few years, they’ve taken on assignments for Microsoft, AT&T, and Amazon (the last of which uses few outside agencies) in addition to other brands.
We hear all the time agency execs who lament that their clients don’t allow them to be their “trusted partner.” Or at least allow them to help guide the business. And that’s the specialty of Rational Interaction. As Petosa says, “We ask a lot of questions. We invest the time. So we want to work with companies that are like-minded, who are ready to go on a journey with us. That’s our ideal type of client.”
Seattle isn’t a large market for advertising. Once upon a time, there were offices of DDB, McCann-Erickson, JWT, and other heavy national hitters. Those are gone, and Rational Interaction is one agency that’s filling the void with a different model.
With both technological savvy, creative ability, and thinking that clients in the Pacific Northwest and beyond appreciate, Rational Interaction is definitely making a big splash.