Cross Marketing With an Agency

In search of the perfect marriage – I’m sitting spinning on my ‘directors’ chair, drumming my fingers, scheming up something evil I can suggest to a client, to rip more precious lucre from their customer’s plastic accounts. And I’m wondering what lunch might look like, who I’m having it with. I’m bored, of course.

It’s a condition that lives with you night and day when you’re over 40 and have been in the same business for more than 10 years. There’s hundreds of thousands of we ‘executives’, unexcited, but competent, out there in the ‘burbs, making up the decision-making class, wondering what little adjustments we can make to our lives to let a bit of spice in. I stare at the phone, thinking, as one does, if I had the right number, and knew whose name to drop, I could speak to George Bush or Vladimir Putin in 10 seconds. I wonder what changes to our existence I could manage, if I said just the right thing…

Like a Volvo coming off the production line, praying it will end up in the hands of someone who can drive, the phone rings. I’ve obviously willed it to ring. I can now claim involvement in a miracle.

It’s a bloke. He asks me to tell him about Starship. I give him the usual 30 second ‘lift-stopper’. That’s what we do, who we handle. He tells me he’s been to our website, and that he’d like to come in to our office and discuss a project. I ask him for an idea what it’s about, and he says a few sentences that explain his company, what they make, where they sit in their market and what they spend on advertising. We agree on a time to meet. The whole conversation takes about 3 minutes.

Oh goody. New business. I’m suddenly excited again. Something to get my teeth into, to think about. And that’s exactly how it happens. It’s not complicated.

This article is about how to make that choice, from someone who has pitched to hundreds of clients. (Sometimes they’ve made the right decision. Sometimes that’s choosing Starship. Sometimes the right decision has nothing to do with our agency.) This is not from a client’s perspective, it is, as the guy in the purple says, from the pulpit.

There’s a few things to consider before you pick up the phone.

Agencies are full of sales people

No-one survives in agency land who can’t sell an idea to a client. So what they say/do is designed to get you hooked. It may be all eager and earnest, it may be very businesslike. Or not. Just because they come across uninterested or ‘cool’ don’t think for a moment that that isn’t their act. It is. Take everything that is said or promised, as a possibility only.

Agencies are great at selling you the world and giving you Dubbo. That’s why the rest of society says we’re wankers.

People have to make money

Agencies are businesses. They are not retirement homes for ageing journalists or stepping stones for creatives on their way to Hollywood, however the individuals within them see themselves. You must make their time worth it, or they can’t work on your business. Accept that people with more brains cost more money – don’t buy on the basis of price alone.

What is it you really want?

Do you want to be known across Australia/the world as the girl who did X? Do you want to marry your bosses daughter? Should the brand be No.1 in 6 months? Should you be able to take over your main competitor in a year because they are broken financially and physically? There are millions of goals. So many clients don’t explain what they really want. 6% of sales increase. To stay in Woolworths. I need to take the board’s eyes off my budget/performance. Decide on 5 or 6 that are realistic for your sort of money. Then find the agency who can do 3 or 4 of them.

Do you want them to be very busy?

Some people gravitate to the very fashionable hot team. But keep in mind, these people are often hot due to one or two campaigns that may not be at all relevant to your industry, your needs. And the reason they are ‘hot’ is because someone let them do an ad or two that was really out there. Often it’s not the creative teams that are good, it’s the ability for their suits to sell the ideas on to a board – many agencies are very good at creative and have done great ads, but you’ve never seen them because no-one had the guts to run them or put enough money into their air time.

Don’t ride a bad horse

What you want is a sparky horse you have to pull back, that scares you, not one you have to kick all the time to get going. It’s so much easier to say “no, whhhoooahh”, than ask for the impossible from a bunch of untalented dick-heads.

Creative kills media every time.

Keep in mind this very simple fact. Really stand-out creative costs way less to do the job because you don’t have to run it as often for it to be noticed. A media group will tell you success is all in the media choice. This is bullshit. Yes, effective media is paramount to getting value for money, but if the creative isn’t much good, no-one will care. You will spend far more on media to get the same effect. Which serves who? Yes, you betcha, media buyers/sellers and the media itself.

Must they know your industry backwards?

Sometimes this is paramount, but rarely. Generally, if an agency knows a little bit about an industry, that’s enough.

Do you want competent work or work that breaks the mould?

Sometimes the trick is to keep yourself in with the board. That may mean conservative, but nice work. Other times, the only thing that may work in an industry is right off the wall. Choose on this basis, but understand that the people who did the really radical stuff for an agency may have left years ago. So ask who did it, when and where they are now?

One agency or many?

Most smaller companies are better off with one agency who does it all, for consistency reasons and because every agency/design group will think every other one’s work is shit for one reason or another. So if they have more than one, they get pulled left and right all the time. It’s like that with all professions. Dentists tell you what’s wrong with the other guy’s work. So do accountants, so do I.T. people…

What they do now vs. what they could do?

John F Kennedy stole this line from a genius. “We judge ourselves on what we feel capable of doing, while other’s judge us on what we have already done.” Many agencies do great work which never gets seen, for whatever reason. Ask to see their rejected creative files.

Shit well shot

If an agency thinks a client is reasonably dumb, or they are pitching to a committee of 4 or 5, they will dress up the ideas to the max to make sure they like therm. The ideas themselves could be so lame it’s not funny, but well art-directed, anything looks good. Insist on hand drawn roughs with ideas – any agency can make anything look good.

Skills base

Do you need certain skills, in media, etc. – or mass market stuff?

The tools of the trade have really changed for marketing in the last decade. You may need strong resources in the digital and media space-someone with capabilities in video, blogs, podcasts, etc. They are often very different skills but still can come from the same people. It’s more important if they are comfortable with your communication style – if they only do big powerful ads and you need a soft sell done with long copy, ask yourself if they can change their head-set?

Don’t get fooled by the promise of big name creatives (who may never work on your business), marketing ‘sophistication’ (I hate jargon – it’s used by various professions to pull the wool over the eyes of their clients), many offices, or ‘international alignments’ etc. They are like mobile phones or cameras that have so many features they can virtually make you breakfast – do you really need to pay $10,000 more per month just to be able to see ads from London, when you could see them on YouTube for nicks?

There are many agencies who boast big, impressive client lists who only have them because their owners in London or New York signed a world-wide contract. Think Nestle, IBM, Ford etc. Thus, they do not have the talent that won the account. Don’t let a big client’s logo behind the receptionist’s desk fool you.

Fit with your company

They must fit your culture more than anything. If they don’t understand you, they’ll never get your brand. Go with people you can really talk to.

The agency must also fit the stage you’re at. A big corporate with 20,000 employees can only use a little agency for top of the heap stuff like corporate TV or little jobs for small divisions. They can’t get all their stuff done by a small company, there’s no capacity. Likewise, a big agency will ignore a small company like you ignore an ant. Decide if you want to be a big fish in a small pond or whether you’re happy being one pretty fish in their glass bowl. It’s about balance – can they do our work? Will they care?

Don’t jump too quickly

People often throw the baby out with the bath water – most agencies are dying to put their grubby hands all over your baby/brand. Often just to prove their ideas are better than the last people’s – you need to make sure you know what is sacred to your brand’s existence and what is transitory. Would Maccas change their logo to blue? Would you let them do it if you were marketing manager?

Two or three bites of the cherry

Sometimes a good agency doesn’t get it first time around. If you really like them, tell them what you think isn’t working and see what they say. If they are grown-ups, they will probably come back with some other ideas or a new approach.

Dumping the old gang

This needs to be done carefully and with diplomacy. Many a split has been caused by poor basic communications or even accounting on either side. This is something that can usually be easily fixed. (And many a creative group has mysteriously lost all your artwork after a nasty break-up. Whoops – the server fell over!) Know first that you are sure, and remember never to jump out of a plane without a parachute.

Process for selection

  • Check their website.
  • Choose about 3 or 4 to see only (the more, the harder the decision will be and the more of everybody’s time you waste).
  • Ring and make an appointment (first few are usually free).
  • Brief in the project/pitch details.
  • Offer a small sum for their time – say $5,000 to be taken seriously for a small pitch, $50,000 for a Telstra (it will still only be 10% of their costs, but you will sleep better).
  • Give them 2-3 more meetings and about 3 weeks to do the pitch.
  • See them in 90 minute windows – do not let them drag it out.
  • See only one or two a day – you will be exhausted otherwise.
  • Take another week before you decide who to chase up – sometimes ads take days to register, even on you.
  • Negotiate a deal.

What would you do?

If I was choosing an agency, whether it’s for creative, a design job, a media buying group, it doesn’t matter which, I’d decide what size I wanted and what kind of work/talent skills I was looking for. Check their sites. I’d ask the most interesting three to pitch, just with rough drawings of ideas or media strategy – not completed negotiations – and a three page proposal. I’d judge them on the quality of their ideas and how accurately they met that exact brief. Then I’d give the best two of them one little job each. Maybe a magazine ad, maybe a media buy, whatever.

Given that went really smoothly, I’d negotiate with the one I liked best on rates and retainers. And not actually decide until I’d finished that whole process.

Next week, I’m writing about changing a company’s focus from production and financial stuff to a marketing emphasis and how to do it cleverly. If you’d like to help me to change focus, call me and we can dine over it.


How creatives charge

Make no mistake, if you don’t remunerate them well, no-one will be motivated to work for you. There are seven key ways for agencies, but none of these are mandatory now and it’s usual for only 2-3 to be in your contract:

Media commissions

The original percentage of spend approach, usually 10 percent. This of course encourages high media spend, low creativity.

Service fees

A basic up until about ten years ago, service fees are almost unused nowadays. They used to be 7.5% of total spend.

Hourly rates

Run normally against a timesheet, these reflect the work done. It may cost you more than you want, but is no doubt pretty fair for all.

Project fees

Usually quoted at a flat rate. Be careful to include multiple versions of copy, as you may change your mind at great cost. Small creative groups spend hours accurately costing each job, then go broke and disappear.

Retainers

A fee per month that usually has X number of tasks in it, and an over-run if there’s extra work. Almost all PR firms live on this system alone. Can be good value, can leave you wondering what they did for last month’s $10,000.

Hit fees

Sometimes a brilliant idea, logo, TVC, product concept comes from someone you don’t want to sleep with, but are happy to dance around a hall with. You can pay an agency a once-off fee for the idea and everyone’s happy. You could rip it off, but hopefully they’d sue you for theft of copyright.

Sales/results

Some strugglers (client or agency) try to sell a percentage of sales deal. These are notoriously hard to measure, hard to contract for, hard to follow-up and can lead to very nasty court cases. Don’t say I didn’t warn you.


Recent research

(B to B Magazine, 15 January 2007)

B to B Magazine asked marketers to rate their relationship with their lead ad agency. It found that 23.6% of marketers are “extremely satisfied” with their lead agency; 52.9% are “satisfied”; 19.7% are “somewhat dissatisfied”; and 3.8% are “extremely dissatisfied” with their agency.

Currently, 16.4% of marketers are involved in a search for a new agency; top reasons for searching were “current agency is not producing results” (29.9%), “change in strategic direction on the client side” (13.9%) and “cost cutting” (13.4%).

What are marketers preferences? The overwhelming response was understanding the client’s business (cited by 64.7% of respondents), followed by good chemistry with the agency (17.9%) and outstanding creative (15.0%). Only 2.4% of marketers said price was the No. 1 criterion in selecting an agency partner.

B to B’s survey found that just over half (50.5%) of marketers use one ad agency, while 44.2% use up to three agencies and 5.3% use more than three.

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