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There's a long-held assumption that regional agencies are synonymous with unsexy clients and a humdrum workforce. Surely all the smart thinkers with the merest hint of zeal would head straight for the capital? And don't regional agencies gibber with fear at the thought of their most prized staff being lured away by the bright lights of Soho?

The reality more than contradicts this stereotype. Both creative and media talent now seems just as likely to ebb away from the capital as to flock to it. Are regional agencies finally shaking off the long-held stigma that they are somehow playing second fiddle to their London-based sisters?

Paula Kesley, the director of the Fresh Awards scheme, which recognises outstanding regional campaigns, certainly thinks so. "It's an outdated theory to assume that working in London is superior to working in the regions," she says.

Some think the creative work is pretty good too. Kate Harris, the former Nabs doyenne, who recently left London to become the marketing director at Cheethambell JWT, reflects: "I was quite surprised when I saw Cheethambell JWT's work because it's a lot better than I thought it would be."

Paul Baker, who left London two years ago and is now the executive creative director at McCann Erickson Birmingham, adds: "I was pleasantly surprised by the quality of people and their approach to creating advertising and communication."

What's more, as integrated campaigns are more in vogue than ever, the top regional agencies would be smart to update their credentials; a generous smattering of them boast hard-working through-the-line campaigns that wouldn't look out of place on the reel of any top-ten agency.

Yes, those agencies that are often sneered at for spending their days churning out copy for double-glazing ads and local shopping centres are getting themselves noticed for some eye-catching campaigns. Some clear-sighted and intelligent media planning is finally getting the regional shops noticed by the rest of the world.

A prestigious US awards scheme named after David Ogilvy recently doffed its cap to the work of a Cambridge shop with just 12 staff. Omobono's work for the East of England Development Agency also won two IPA Area Effectiveness Awards.

The "demand broadband" campaign pushed up broadband availability in the region from 53 per cent to 93 per cent on a minuscule budget by using interactive, direct marketing, viral and sales promotion to spur the locals into action. So the East of England Development Agency - which was awarded a runner-up place in the David Ogilvy Awards - found itself rubbing shoulders with bigger brands such as Pfizer and Lexus. Not bad for a cost of £413,000.

Those who work in agencies outside of London don't consider this approach to be anything out of the norm. While the industry and clients run around dropping phrases such as "media-neutral planning" and "branded content" into conversation, regional agencies claim they are more experienced at working across several different platforms.

Couple this with their ability to think nimbly on frugal budgets and it's a wonder that any bean-counters sanction London's spendthrifts to come within sniffing distance of their marketing budgets. Declan McKenna, the managing partner of MediaCom North in Manchester, says: "We've got two watch-words: accountability and innovation. With so much pressure on finance, Manchester will always score on that front. Our rates and costs are so much lower so we can do good deals for our clients."

Ben Quigley, the managing director and partner at Different, the ideas agency of "smoky baby" fame, says: "Media has become so fragmented you need agencies which are comfortable with the idea of delivering brand messages across a number of platforms. Certain brand owners find it hard to control their marques when they use different agencies, so they risk ending up with a schizophrenic brand."

Andy Cheetham, the creative director at Manchester's Cheethambell JWT, comments: "Work in the Titanium category this year at Cannes was definitely the most talked-about because it showcased multi-layered campaigns with online, viral, stunts and movies and so on. In the regions, we have always been integrated because you get clients with limited budgets who don't divide up the pot between different agencies. They come to us and say 'we have this pot of money, what can we do to make the most impact?' Only a fool would advise them to go on TV."

Cheetham's agency was recognised at Cannes for a campaign for Scruffs, a workwear brand. Entitled "it's gonna get dirty", the campaign spoofed porn plotlines to entice builders into the store or online. Using virals, a website, specialist and national press, point-of-sale and a free DVD (Hardcore - The Dirty Movie), Scruffs built equity in a sector where most brands are invisible.

The campaign sparked a heated debate among the more sensitive quarters of the Cannes jury. Some found it genuinely offensive, one female juror - Nici Stathacopoulos, the chief executive of the South African agency The Tipping Point - called it "worrying". Still, she couldn't deny that it struck a chord with the target group of lusty builders. "It's gonna get dirty" was one of the most awarded campaigns this year from a regional agency.

Cheethambell JWT's recent work for Lambrini has proved even more provocative.

A poster featuring three young girls winning a male model in a playground was slammed by the Advertising Standards Authority for flouting its rules linking alcohol and sexual conquest. The agency duly responded with a poster with three girls and a bald, fat bloke as their prize.

Talk to Cheethambell JWT, the Manchester-based BDH\TBWA or PWLC in Leeds and Love Creative, and they take issue with the term "regional agencies".

They see themselves as on a par with London shops and don't equate themselves with some of the more spit 'n' sawdust agencies in the regions.

"We don't use the term 'regional agency' because it can be perceived by some people as being derogatory," Alistair Sim, the co-founder of Love Creative in Manchester, says. The agency has just hired Jonathan Rigby, the former managing director of FCB London, and is encouraging Mancunians to visit the city's Museum of Science and Industry with posters of "lost" dinosaurs. "We want to compete with the best agencies in the country and beyond," Sim says.

He adds that it's not just regional clients who use agencies outside the M25. "The majority of our clients are actually from London," he reveals, "And that's why it's important to think regionally. Only a small percentage of the population lives in London so we don't risk falling into that trap of creating campaigns for a London-centric audience."

And in the era of mobile phones, laptops, broadband access, home-working and virtual offices, how big a deal is the location of an agency? Surely the cornerstone of any agency/client relationship is work which is on brief and punches above its weight creatively? Look at the likes of Fallon, Bartle Bogle Hegarty and Wieden & Kennedy. They are agency networks founded on the idea that you don't need offices everywhere to handle big briefs.

Andy Lockley, the creative director at BDH\TBWA, whose recent work includes tongue-in-cheek posters to shout about Wickes' status as the official home-improvement partner of the Championship football league, comments: "My experience at Publicis Mojo in New Zealand taught me that it doesn't really matter where you are geographically; you should just be competing with the very best." Lockley recently hired Joe Coleman, a creative from the Leeds agency Brahm who famously spray-painted naked women on to the streets of Wakefield to attract customers to a "gentlemen's club" called Wildcats.

Brahm is another interesting agency which motivates its staff by way of the Brahm University - a scheme to broaden the minds of its employees, which ranges from courses on chocolate-making to talks from visiting Buddist monks.

But beyond such flirtations with the unusual, no-nonsense clients prefer the no-nonsense approach of regional shops. Baker says: "Clients are realising that there are agencies that are prepared to do things differently and work more flexibly and in a style that's slightly less arrogant."

Baker reveals that McCann Erickson Birmingham has appeared on several London pitchlists and believes the agency's relaxed and straightforward approach stands it in good stead with clients. "Because we're fully integrated, it's no problem if a client has a limited budget. We just roll up our sleeves and get on with it. You potentially have to work harder and be less complacent in the regions, but that's refreshing. Of course there are certain people who'd never make the trip up here, but they're not the people we'd want anyway. We want people who want to work in a more collaborative and less pretentious way."

Another fact of regional life that appeals to clients is the tendency of senior staff to work on their accounts because the agencies tend to be so much smaller. At MediaCom North, whose head count nudges 50, McKenna says: "It offers clients value for money because the quality of personality they are getting is higher. Clients always get the key people, whereas in London things do get passed down the chain a bit."

He adds that the agency has made some significant hirings from its sister agency in London, as well as from JWT and Starcom, and makes the point that "creativity just doesn't reside in one place".

In fact, some agencies are highly critical of work from London. Francesca Brosan, the chairman of Omobono, says: "While judging awards for business-to-business advertising recently, I saw work from the biggest and supposedly the best agencies in London and I thought it was shockingly bad. Yet you can get a small ad from a regional agency that's a cracker."

Omobono has recently extended its work for the East of England Development Agency into events, where eminent figures such as Edward de Bono and the founder of Management Today, Robert Heller, have addressed entrepreneurs in the region. "We are producing content that people can use," Brosan says. "Traditionally, regional development agencies have sold themselves as fantastic environments where you can combine business and quality of life, so we are trying to differentiate ourselves by saying that the East of England is a place where ideas flourish."

Such ideas generate buzz and PR and have traditionally been thin on the ground for business-to-business brands. Yet ask creatives from the regions which consumer-oriented campaigns have caught their eye and the examples come thick and fast: True North's work for the 60th anniversary of Manchester's Imperial War Museum, Big's work for the drink brand WKD and Robson Brown's work for Flymo to name but a few.

But some sound a note of caution that the "jack of all trades, master of none" approach of some regional shops can result in work that is either inconsistent or invisible.

Rick Ward, the creative director at PWLC, comments: "We've been single-minded about the idea that we're an ad agency and we're not trying to be all things to all men. But a lot of regional agencies do design, sales promotion, PR and packaging, so because they are doing many different jobs, the quality can come across as patchy."

Stuart Feather, the joint managing director of Feather Brooksbank, the media agency with offices in Edinburgh, Glasgow and Manchester, advises: "Agencies have to recognise what their own limitations are. It can be a real weakness if they don't."

Feather adds that location can also be an issue with some clients. "Location shouldn't matter but inevitably it does. If something is fast-moving and requires lots of ad hoc meetings, there is no substitute for being located near your clients. Also, certain clients, especially if they have a London-based creative agency, want a media agency in the capital."

And for all the clients who will only ever appoint London agencies, there are a collection of much smaller clients who will always seek local talent.

This means that working in the regions means becoming accustomed to less substantial budgets for less glamorous clients. Brosan says: "I moved to Cambridge in 1991 when I had my first child. I'd been an account director on BMW at WCRS and my first thought was, 'Oh my God, how do people operate on budgets like this?'"

So if Champagne and China White is your scene, then a job in the regions probably isn't for you. But it works for many people, particularly those with families who hanker after a better standard of living as well as a professional challenge. Kesley sums it up: "It's easy to think that the advertising industry is London-centric, but it's a big industry in the regions as well."