Recently I was catching up with a former agency partner and we got into a conversation revolving around two specific points: 1) The ability of midsize agencies to survive in these tough times; and 2) How to grow the business at a particular client who has never retained an agency or spent consistently. In my friend’s case, it was the area of PR. This conversation made me realize that often agencies do not understand how their clients think. The answers to both of his concerns lay in better understanding client motivations and spending.
I have spent many days sitting in an RFP pitch or as part of an agency bid process, and I am often amazed at how an agency doesn’t follow the brief, hasn’t done their homework about the brand or is just clueless about how the client is going to evaluate them. Furthermore, there are many on the agency side who have never been on the other side of the table and don’t really understand how the client thinks. So, I am going to provide a little insider information, starting with the answers to my friend’s two points.
The size of the agency doesn’t matter
The prevailing thought to my friend’s statement is that the client will either want a big agency with big resources or a small boutique with a niche in specific talents or industry knowledge, thus leaving the ones in the middle lost. In some cases, that may be true, but often it is about three key elements: chemistry between client and agency team; creative that delivers; and the knowledge base of the agency team. An agency of any size can deliver these things and will survive if they are a good agency. So size is not the issue – it comes down to how you connect with the client and what you deliver.
Additionally, the actual size of an agency can be hidden. More than once I have used sister agencies and subcontractors as part of our potential client team. I have been open that these folks extend beyond the actual employees of the agency, but the client was satisfied in that these were dedicated resources to their project.
You can’t get water from a dry well
There are very specific reasons that a client will spend only so much on a given marketing tactic. In the case of the client my friend was trying to grow, there were a couple of reasons: 1) The company did not have a need for ongoing PR support, just bursts for new project launches; 2) Social media, which is often managed by PR, was being handled by the media buying and promotion agencies. Upon evaluation, my friend’s agency would probably have found it a waste of time and effort to try and push for more immediate business because their client would never be interested in ongoing PR initiatives and their business didn’t demand it. Understanding how a client manages your agency’s area of expertise will provide you with direction on how to not only manage your client’s day-to-day business, but provide more appropriate new opportunities for you to pursue with them. Generally, these kinds of clients use you as a service provider and not as a partner, so maintain an ongoing relationship to ensure you get the next bit of business that comes up. Don’t push too hard for something that isn’t there; it will just frustrate you and annoy the client, since you can assume they already know that you are looking to grow the business.
Chemistry is everything
Following the thoughts from above, when it all comes down to the final decision on who your agency is going to be, there is one key evaluation – are you a good fit with this client, and do THEY feel the chemistry? Pricing, creative, location all do play a part, but the team choosing to work with the agency has to feel they “like” them, that the agency “gets” them. It is sort of like dating – do you feel chemistry or not? I have been a part of agency RFP’s where an agency was chosen not because they had the best creative, but because the V.P. felt a connection with the team. The agency didn’t work out, but that gut feeling often is a driving force.
I knew of a client that was unhappy with their agency. Staffing had changed, and the agency was dropping the ball when it came to delivering what the client needed. The client was about to pull their very large business from the agency. A new leader joined the agency, and his personality, dedication and overall chemistry with the client was evident when they presented to this client. The client believed in this new leader and the plans he presented because this agency leader knew how to connect and what needed to be said to save the business. Through the chemistry and the connection, the leader saved the client from exiting the relationship.
Chemistry is everything, unless there are politics involved
Here is my caveat to “chemistry is everything” – politics trumps chemistry. You’ve walked out of the pitch, you feel great because you know you really connected with the senior team evaluating you. The team complemented you on the creative, and you feel like this one is in the bag – that is, until the phone call comes that says it went to another agency. What happened? Probably politics. We all know that corporate politics can be brutal, and in the realm of agency selection, it can change the tide of the decision. For example, on a recent agency search I was involved in, it came down to two agencies. Agency A was the AOR of another business unit and well respected. Their creative was dead on, and they connected well with the team. Agency B gave a great presentation and connected well with the team. However, the team was split on which agency to choose. It was apparent that the V.P. felt more chemistry with Agency B and liked the creative better. The final decision was hers to make, and the team was sure it would be Agency B. Much to everyone’s surprise, Agency A won. The reason? Politics. The V.P. had no issues going against key members in the decision-making team, but what she couldn’t fight against was the pressure from above to consolidate agencies and go for the well-respected agency already working with the other business unit. While frustrating for her, politics won out once again.
Agencies prefer retainers, but companies often don’t
This has forever been the dilemma I have faced on both sides of this equation. As the service provider, the best way to ensure a steady monthly revenue stream is to have your client on retainer. You can better manage your staffing and overhead. Moreover, it is the best way to be seen as a marketing partner and not just a service provider. For many clients, especially large ones, they support the idea of a retainered agency and even embrace it. However, many companies much prefer to work with agencies on a project basis. Their budgets are tight, and they want the agencies to come up with great ideas and execute them, but they don’t feel the need for ongoing support. Whether you get hired back depends on how well you execute that one promotion vs. being judged on the overall promotional strategy you helped them develop. While some clients do have agencies of record that aren’t retainered, those agencies are always in sell mode because they don’t have commitment.
A couple of additional points on ways this isn’t always the case. As companies have moved away from internal marketing services teams, there is a greater push for agencies of record and retainers. This is mostly because the company doesn’t have the in-house personnel to manage the programs. Social media and product ingredient issues are also putting a greater emphasis on things such as PR and consumer outreach programs. Many companies that utilized PR only for new product launches and general outreach are seeing more of a need for ongoing support. I saw this first hand while working on sun-care and infant products. Because product ingredients and packaging such as plastics where consistently being called into question, there was a need for constant media monitoring. Additionally, enough of a case was made internally for management to approach things differently. Therefore, PR became an ongoing need requiring a retainered relationship.
Following the creative brief is important
Your creative may be awesome, your insights into the target demo dead on and your chemistry with the team palpable, but if you don’t provide the answers to the questions the creative brief asked, you are basically dead in the water. You are being evaluated against other agencies on how well you responded to the brief. You miss the target, you are evaluated poorly. You can claim misinterpretation of the brief, but it is your responsibility to ask questions upon receiving it. There are times in the early rounds where you may be given a second chance, especially if the client liked your creative and your team. Don’t count on this because sometimes there aren’t multiple rounds. Your agency may be known for stepping outside of the box and taking briefs in another direction. That is fine as long as you don’t completely challenge the client’s intended strategy and ignore the direction in the brief.
Clients want to know that you can work with other agencies
In these days of integrated marketing, clients need to know that you can play nice in the sandbox. You need to always provide examples of agency alliances and instances where you worked as part of an integrated agency team. The clients don’t want to play referee, and they don’t have time to manage all of the intricacies of how the different elements of the program are going to come together within the different agencies.
Some of you may think what I have presented is common sense and obvious. In many ways it is, and those that are aware of these lessons are ahead of the game. However, you will be surprised how many agencies I have encountered that don’t understand what the client really needs or is looking for. They get so wrapped up in their amazing creative or wealth of experience that they fail to understand what is motivating the client. Hopefully, this will help provide some of that basic insight so those agencies that are less aware will be more successful in their pitches.