The agency life cycle is defined by winning clients. That’s because the minute after an agency strikes up a new relationship the clocks starts ticking to when it will end. With short chief marketing officer tenures and a highly competitive environment, the end is coming sooner than ever.
In this week’s Confession, Digiday spoke with a veteran new-business executive at a digital agency. This exec expressed frustration over how agencies again and again devalue their ideas through a dysfunctional pitch process that’s increasingly driven by procurement, sometimes just for show, and seemingly at odds with cultivating a successful, long-term partnership between client and agency. View all entries in our Confessions series here.
What’s wrong with the new business process?
We devalue ourselves from the beginning. A client puts out an abstract problem to solve. We put everything into solving it. We give away everything in the beginning and we wonder why clients don’t value us. Imagine a restaurant where the customer asked to sample everything and then chose afterwards only to have an appetizer. It doesn’t reflect how to work together. Agencies put a ton of money into it, pulls its best people and then the client hides behind a veil of procurement to ensure a level playing field. But that’s not how you work together. In the end, you’re a vendor of ideas or execution. It sets everything up in the wrong way. A client might fall in love with an idea or a team member, but that doesn’t get you past month two.
Is this part of the reason why agency-client relationships so short?
It’s part of it. We’re going on an episode of “The Bachelor.” It’s an artificial construct. It’s highly produced, and at the end you wonder why it’s not neverending love. Relationships are forged in trial, where you go through shit together, and that doesn’t happen in the pitch process.
Do you worry about giving away ideas?
It’s become a cost of doing business. That’s ridiculous. Ultimately what it’s saying is our ideas aren’t worth anything which means [clients] can find them anywhere. It puts all the onus on the idea being the winning thing. Quite often there’s a good idea with a shitty way to execute it or manage the process. It’s a beauty pageant. I don’t think the idea presented in the pitch has anything to do with what it’s like to work together. in digital it’s more complex. the ability to bring that thing to life is hard. In digital, particularly, it’s not about one big idea but a series of things you have to do with different formats and touchpoints to make the brand real and meaningful to consumers. It’s not just a 30-second spot.
In an earlier Confession, an agency CEO spoke of how many pitches are charades to satisfy procurement when a favored agency is the foregone winner. Do you run into that?
They’re called fishing expeditions. The client might be dissatisfied with the current agency but not entirely. It’s to light a fire under them. Or there’s a internal fire drill and they need ideas. They might need ideas for a presentation to the CEO. It’s the cheapest way to get a whole bunch of shit. The moment I smell preordained I try to run away. But agencies have egos. Creative directors think they can come up with the great idea that wins them over. Agencies sometimes throw themselves into these Joan of Arc pitches. One time we saw on TV an ad we did on a comp for a client four weeks before and the client didn’t even let us know we didn’t win the work. When the relationship starts off with that kind of imbalance, how can it become a partnership? Why respect anyone who put out on the first date? They wonder why they call us whores.
The pitch process seems pretty artificial. Is it?
It’s all specious because it’s not how it works in the real world. The apples to apples in a vaccuum is meaningless fruit. You’ll get a brief that every agency is working against. It asks you to use certain toolsets. Clients then look at who solved it best. But is that the right issue to solve and is that the right way to solve it? Sometimes when we go off and solve something else they say it’s brave, and sometimes they say we didn’t do what we were asked for.
Do you often not know why you lost?
That happens often. The worst is when you’re pitching to a client that’s not aligned internally. There’s not much visibility to what it means to win a pitch in these organizations. You don’t really know what the winning thing is. you’ll get the usual bullshit about chemistry or strategic insight but often it’s about a relationship or who the hell knows.
Are the wrong agencies sometimes in the pitch?
Totally. It’s clear clients haven’t done the homework of what type of agency they want. It’s not that hard. You don’t need [search consultant] SRI to figure that out.
What makes a good search consultant?
A good search consultant will take the time to understand the agency and capabillity. A good search consultant will say you might not be right for it but there’s something interesting there. A good search consultant will outline the problem and the organization and the culture, because often a client won’t do that. The truth is working with a client is as much working with a culture and solving a business problem.
And the bad?
Search consultants are supposed to accelerate the process. but they’re not compensated to do that. Often when we see a search consultant we had another zero to the pitch cost. They also bullshit about the budget. The thing you win ends up being half what it was when you started. That’s the worst thing. Imagine going to sell your house and someone tells you at closing the price is half. The lack of transparency is the thing that kills all of us. Right now it’s a buyer’s market so clients can do it. Bad search consultants often do misdirection. They have eight boxes to fill to fill an array of options. We all end up filling a role to show there’s diversity. They’ll never admit to it, obviously. The search consultants often reinforce preconceived notions.
Do agencies spend too much money pitching?
It works out brilliantly until the size of the prize changes. It’s happened I’d say seven out of the last 10 pitches. The cost keeps going up because of the competitive market. But the size of the prize is going down. Clients will do it because they can.
No new-business conversation is complete without a word about procurement.
I’ll say something nice about procurement. I’ve been in enough pitches where without procurement, a client’s neglected to do their job. They need some stuff to put in front of the CEO, so they’ll run a pitch. At least with procurement you know there’s a contract at the end. I can’t tell you how many agencies pitch for vapor work. It happens a lot. If procurement’s job is to drive pricing down, it’s not a bad thing. Agencies can structure things to make it work. But when procurement puts impediments in the process it’s bad. It becomes a blind thing. This isn’t the manufacturing of widgets. It’s a people- dependent business. If you don’t know who they are how are you going to work with them for a few years? It’s when they hold the relationship at bay, that’s where i have a problem. You have these carefully manufactured points of interaction with the client where the client can’t reveal much. You don’t really know what you’re getting into — on both sides. The best pitches I’ve done aren’t about what happens in the room. It’s about the time you spend with clients between trying to figure out a collaborative process of solving things together.
Examples of bad behavior you’ve seen in pitches?
I’ve seen agencies steal presentations or eavesdrop on rehearsals. I’ve seen clients change briefs but only inform favorite agencies before others. Those are the most egregious.
What one simple step would improve pitches for all sides?
Clients pay for the pitches and in turn insist the agency puts real people to work to solve a problem mutually. It can be something small and discrete and in a set period of time, say a month, with a defined amount of dollars. That’s how I’d run pitches.
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