AI workflows and asset-based pricing: inside Media.Monks’s production studio overhaul

Traditional methods of pricing agency work, revolving around the labor hour, meant that there were few ways to make that phrase a solid reality. In the last two months, however, production arm Studios.Monks, has begun to shift away from time-based pricing and towards an asset-based model.

According to Dave Carey, global executive vice-president of studios and embedded solutions, the emergence of viable marketing automation and generative AI tools, plus more clients squeezing marketing budgets, provoked an overhaul at the company.

“We’re seeing a really big marketing transformation shift across all of our clients. They’re all looking at how they can consolidate their content into one model, trying to get rid of 137 agencies down into one unified contract,” says Carey, who was hired in November.

“Some of the more modern marketers at Coke, Ford and Google started these transitions five years ago. Now, I think we’re seeing the smaller organizations catch up.”

In response, Media.Monks has switched up its content production offering, Carey says, relaunching its Studio.Monks brand with a promise to shave 20-30% from client budgets, supposedly without compromising on quality.

In part, this is an effort to bring the agency’s AI and marketing automation expertise to market – and begin to claw back some of the treasure spent on its development.

“We’re seeing AI coming on board, budgets being cut on the film side… it’s about how we do digital and video assets at scale, through AI and automation tools,” he says. “That makes content more relevant, more personalized and cheaper to produce.”

It is also, however, a transition towards an asset-based rate card for production work. Media.Monks previously priced up work based on the time it took to make, much like other production firms or creative agencies, Carey says.

In December it switched to an output-based pricing strategy, with six product lines. Those include production pipeline design (dubbed ‘Creativity at scale’), consulting work, original content production, adaptation and translation, distribution services and discretionary access to its creatives (‘Artist.Monks’).

Media.Monks declined to share a sample rate card with The Drum. But Carey says: “We’re looking at a different pricing structure, a different model on how we how we produce creative and produce assets. I’m looking at it more from a creativity-at-scale perspective.”

Carey says that Media.Monks’s previous means of monitoring costs meant that the correct price of its work was “really tough to measure.” But internal AI-enabled production pipelines, he says, mean the agency can now track “the life of an asset going through the system… and price it accordingly.”

Now, the company is using bespoke asset-based rate cards. The primary variable between cards, he explains, is the location of the staffers being used on a given account. If a client requires a team of India-based staffers for timezone convenience, the cost is lower because salaries are generally lower than in the Netherlands.

If a client is looking for staff that understand American consumers but only has a low budget, Media.Monks aims to oblige by deploying Toronto-based teams. “We try to create bespoke mock rate cards for every single client. We look at their needs; we look at what countries we can service them from. And we look at what we need to develop to manage the client expectations as well as the profitability of our company,” he explains. “We have standardized rates, but there’s not a standardized rate card.”

Closer monitoring of the time spent creating an asset, combined with outright time savings derived from automation and AI tools, he says, is bringing those savings targets within reach.

“We see reductions in translation cost, we see a reduction in adaptation cost, we see images being able to be made in seconds rather than days. It’s allowed us to become more streamlined and more cost-efficient, and be able to adjust our staff to meet the needs of the market today. With those adjustments have come more assets, lower ways of doing them, less infrastructure cost, and then those costs and benefits savings to clients.”

For a “large” CPG client, Carey says the firm used two proprietary AI tools called Monks.Flow and Translation.Flow, to halve the cost of translating digital and video assets. The former serves as the company’s primary AI management platform, used integrating various gen AI tools and large language models (LLM).

Other adaptation services aimed to make that content relevant to different audiences such as switching out backgrounds in an image, have also become quicker. “We’ve cut the time to market by about 60%,” he says.

Across the board, Carey claims, “When we’ve introduced Monks.Flow we’ve seen a reduction in translation costs of 50% and an increase of speed to market around 60%.”

Four major clients, including HP, are using its Monks.Flow AI services and the firm has already moved one of its ‘whopper’ clients (executive chairman Sir Martin Sorrell’s term for clients that generate over $20m in revenue a year) over to the new pricing system. Carey expects it will also boost retention efforts. “The clients know exactly what they’re getting,” he says.

Meanwhile, Carey says it’s given Media.Monks an edge in the new business arena, with “a couple” of new clients soon to be announced. “It’s put us into some very competitive spaces… we’re winning clients because of it.”

This shift towards asset-based pricing does have implications for Media.Monks staff. According to Carey, teams are now organized internationally around clients rather than the countries employees are based in; within its studio practice, Carey says these teams are now dubbed ‘Engines.’ “We’ve never had a global or regional structure in Studio, it’s all been country or office-related. We’ve tried to bring everyone with the same skillsets and mentality together.”

Some of the internal brands created back when S4 unveiled the group-wide Media.Monks identity in 2021 have been cut, while reporting hierarchies have been updated. Carey says this has brought more decision-making back to the company’s senior leadership.

“There’s a set reporting structure, there are set KPIs, there are set expectations… people have been working in gray for a while and no one likes to work in gray.”

After last year’s group-wide layoffs, Studio.Monks now counts 600 staffers under its umbrella, though Carey says further restructuring means it will eventually account for 1,500 of Media.Monks’s 8,000-odd staff.

“We’ve had to change the way that we’ve hired and we’ve had to change the philosophy of a lot of people internally, to be able to think more,” he says.

“Craft is still always going to be in there, but to craft at scale. It’s humans and machines coming together.”