Beware the 'phantom' win: lessons from true agency stories
Have you ever gone through the pitching process, won but then nothing came from it? You're not the only one as it seems to be more common these days in agency land. It's called the 'phantom' win.
Beware the 'phantom' win: Lessons from true agency stories
It is when you win that big pitch, celebrate, bring in resources and then six months down the line you've heard not a peep from the client. And no cheque at the end of it.
The Drum speaks to industry experts from Digitas, Stein IAS, Across the Pond, and Studio Blvd on their experiences with phantom wins, what's causing them, their thoughts and solutions.
Charlie Hunt, head of new business UK, Digitas
Phantom wins can be more devastating than coming second in a pitch. The impact of a phantom win is both emotional and can have serious business consequences too. If the pitch process has been run well and the teams have been building and developing solid relationships with clients, the disappointment can feel highly personal, impacting morale and enthusiasm for future new business endeavours.
If a pitch fee were to be mandatory, it could ultimately reduce the rate at which brands go out to market – they would need to be really serious about the process and it would help reduce the amount of RFPs which haven’t been fully thought through or had the right stakeholders engaged at the initial stages.
A concern around introducing pitch fees, however, is that it could potentially increase confusion around IP. It would need to be made clear from the outset what the fee covered, and agencies can then make an informed decision as to whether they are prepared to participate.
Reuben Webb, creative director, Stein IAS
Make no mistake they are real and, unless you like having your time wasted, something to be afraid of. But who you gonna call? If only there was such a thing as pitch-busters ready to race around town recovering agency costs, but until agencies learn to stick together we’ll all just have to rely on ourselves to do the busting.
The Pensions Regulator is one phantom I am prepared to name, because we paid for it three times. Once in sweat, tears and great ideas, once in lost man-hours and once in taxes which bankrolled what appears to be bureaucratic indulgence. It was five years or so ago that they tendered for an agency to help them prepare businesses for pensions auto-enrolment. You can imagine the heft of the RFI, followed by the heftier RFP followed by the most clock watching, pedantic live presentation I have ever been party to. And after all that, we are still waiting to hear the result.
If every agency agreed to enforce a standard pitch fee, that would go a long way to make pitches a more carefully thought through, genuine selection process. Like when you sell a house, you know you have a serious potential buyer at the point they pay for a survey. People would do it properly if there was a small fee paid to thoroughly survey the suitability of the agencies. But because it’s free, because agencies never agree on anything, because our divisive nature is easy to exploit we are vulnerable to phantom pitches. If agencies had more credibility in the business community it wouldn’t happen nearly as much, but we’re a divided community with knicker elastic pricing structures and therefore easy to conquer.
Aaron Hutchinson, managing director, Across the Pond
Phantom wins are a symptom of the ad industry’s acceptance of the pitching system. Over the decades we have put ourselves in a position of weakness by handing over all control to the potential client. We have let the client sit back and take it easy whilst they have agencies working like crazy to come up with ideas for them for free. Madness!
We pitched to work on large content series. A huge amount of work was put into the proposal and the client got excited. We were awarded the work and promised a fee for that work. And then something happened, there was a change of personnel and the strategy changed and all of a sudden there was no more content series. Many days of great creative work wasted and not a penny in the bank. It for reasons like this that Across the Pond no longer take part in the pitch and don’t undertake work until we’re paid.
Introducing agency fees is just sticking a band aid on the problem and isn’t getting to the heart of the rotten apple. The reality is that no fee will truly account for the time developing a winning pitch and so we will still have a situation where agencies are losing tens and maybe hundreds of thousands of pounds every year.
The industry needs to recognise that pitches are bad for the agency and for the client.
Alistair Green, global chief strategy officer, Studio Blvd
It happened to us for the first time this year. It was a pitch for a client based in Hong Kong. All meetings were done via teleconference and pitch documents were sent via email. It was never clear who we were pitching against. Alarm bells were going off but we went ahead with the pitch anyway. It turned out their brand was already in the press for bad business practices. We should have done more homework before embarking on the pitch. We won the business but it turned into nothing. We took it on the chin and moved on. We won a much bigger and more prestigious piece of business the next month (without a pitch.) Sometimes a loss is a win.
The ad industry is a very tight and well connected community. Clients who stage phantom win scenarios will be known quite quickly and agencies can make the decision if they want to pitch for those businesses in the future knowing their past reputation.
I think if agencies and industry press were a little braver phantom wins could be reported in the press alongside wins and losses. That would at least hold clients accountable or have to provide an explanation to the industry.
Steven Antoniewicz, head of consulting, The Drum
It’s important to get a new agency relationship off to a good start and get some momentum, there’s nothing like a six month hiatus to dull the enthusiasm and lose impetus.
The reality is that in business things change and they might well change during a pitch process. You only need to look at this year’s story about the House of Fraser pitch process to see that there are often more important conversations going on within a business than which agencies should be on the shortlist.
If you pitch, win then find out there’s no prize a small fee will be scant consolation.
Agencies can minimise their risk by doing due diligence on the client and make sure they know that the promised work is real.
Hunt, Webb, Green and Antoniewicz are speakers at The Drum’s Pitch Perfect, an event which focuses on helping agencies win new business. Check out the website for more information and to purchase tickets for the one day event, Wednesday 13 September.
Sponsors of the event are BD100 and Digitas.