Autumn is preparation time. It’s the time when brands start to think about their agency relationships and many begin to pull together pitch plans for the following year.
Going into the final quarter of this year, there will be a large number of brands looking at this option. We’ve had, and are continuing to have, detailed conversations with local and international advertisers about their agency requirements for next year.
We anticipate that next year’s pitch activity will be at a level comparable with 2015, if not greater. A recent report coming out of the US suggested that 64% of the top 100 spending brands are likely to review their media agency arrangements in 2017, which, if even partially true, will make for uncomfortable reading for many media agency leaders.
Some of this activity is undoubtedly driven by deep-rooted concerns around transparency, a subject that has dominated the industry this year and continues to cast shadows over the value that agencies provide. But much is more about the need to transform or, at least, evolve the way they view and activate media.
Right now, many advertisers are going through a process of internal analysis and reflection and asking themselves big questions about the role that media plays in driving their business results and, therefore, how and in what ways their media agency partners should contribute to that undertaking.
When they come to market in 2017, I believe many will do so with a clear vision of what they want from their media agencies. This will form the basis of the pitch requirement, with a pitch process organised around challenging the competing agencies in ways that assess their capabilities to deliver against that vision.
Those that have a vision will be able to better evaluate the competing agencies on areas that really matter to them and, in turn, the agencies will have a clear understanding what they need to do to impress.
Based on our experiences this year of managing a number of high-profile reviews, such client preparation is critical. Where brands came to market well prepared, with well-considered and challenging briefs supported by a fair and equitable approach to remuneration, we saw a remarkable commitment and focus from the participating agencies.
Not only was the quality of the talent within the pitch teams inspiring, the level of senior agency stakeholders involved and actively invested in the process from the very beginning was hugely impressive
Not surprisingly, smart analytics and data-based decision-making played a big part in the most successful strategic solutions, capturing the imagination of client stakeholders.
Clear briefs and expectations enabled agencies to be bold in their responses and innovative in their execution. The winners were able to take their prospective clients outside of their comfort zone whilst providing a comforting reassurance that the risks were small.
While securing improved media pricing was an important element of the reviews, they were not designed to encourage a race to the bottom. In fact, the agencies were instructed to provide competitive pricing but with a clear mandate not to go below a level that would make proposals undeliverable in practice.
When the process was handed over to the procurement teams to lead contractual negotiations, the discussions were balanced, conducted professionally and respectfully with an openness and willingness to find compromise that genuinely felt like the beginning of a real partnership.
If the predictions for 2017 pitch levels come true, of course it will be impossible for the agencies to provide the same level commitment on every pitch so smart new business teams will have to be selective in the reviews they participate in.
The agencies’ decision-making framework will be based on a number of filters: does the brand in question fit an existing agency category void and does it hit the agency sweet spot in terms of spend, cultural make-up and strategic alignment?
If all these factors are equal, however, it will be the clarity and purpose of the advertiser holding the pitch that will be critical. This autumn’s preparation will allow advertisers the ability to design a pitch worthy of inspiring and motivating the agency community.
In the competitive pitch market we expect to see in 2017, advertisers that fail to prepare will not receive the same levels of attention. They won’t see the A team and they’re less likely to find the right agency partner.
David Indo is chief executive of media management consultancy ID Comms