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The great debate

By The Drum, Administrator

November 30, 2005 | 6 min read

Pitches are the lifeblood of the industry. We know it, and more importantly clients know it. At a time when we have seen a raft of major businesses being centralised or bought out, it becomes ever more vital for Scottish agencies to ensure that they get their fair share of any business that comes up for grabs. Yet research published in The Drum suggests that 70 per cent of clients believe that design agencies should not be paid to pitch. I’m sure that there would be a similar percentage if they were asked the same about creative agencies or media independents.

For many years, agencies have talked about the need to be paid to pitch. After all, pitching places a huge strain on the day to day running of an agency as existing retained business takes priority. No marketing director will tolerate a fall away in service on the basis that the agency is pitching for an account that may or may not result in a stretching of the resources he is used to taking advantage of.

Therefore, out of necessity a lot of new business activity takes place outside normal working hours into the nights and at weekends. Add in the costs of creating the ‘Big Idea’, sourcing research, and materials and a major pitch can cost many thousands of pounds. Yet, even in a climate of shrinking margins, the idea of being paid to pitch has never received widespread support. Why is this?

There’s no simple answer as the spread of business is so wide ranging from the Public Sector to PLCs and SMEs and everyone will have their own view on the matter. However, one could speculate that opinions would fall into one of the following categories:

‘My brand is prestigious; any agency will jump through hoops just to get on the pitch list’

‘Agencies make enough money anyway without me paying them just to pitch’

So are we wrong to demand a fee? A lot of agency opinion is coloured by bitter experience. Any seasoned practitioner can wheel out stories of carve ups, non pitches and the like. As so called intelligent people with considerable egos who value their craft, no-one likes to feel that they are undervalued or are being taken for a ride.

For example, I can recall a travel account many years ago that used to come up for pitch on a regular basis. The ‘long list’ of twenty eight agencies was whittled down to a ‘short list’ of twelve. As the account was worth well over £1million, everyone who was anyone was in for it. Yet it never ever moved. In fact, the final straw for our agency was when, after being told that we had once again been unsuccessful, our creative work was subsequently used in the client’s Christmas campaign that year.

Fortunately, this is an extreme example but there is probably nothing quite so galling as to find that there was never any intention to move the account and that the whole process was an exercise in harvesting ideas for free.

There again, there will be few of us out there who have not benefited at some stage from having the account ‘in the bag’ before the pitch process starts, so the process probably evens out over time.

To combat this, even a nominal fee would demonstrate commitment and immediately command respect from prospective agencies.

Is there an alternative such as a standardised pitch process? Many clients already use key principles that would meet the approval of everybody if universally followed:

Deciding whether a pitch is required or not

Some consider it good practice to have regular reviews to see what’s out there, check costs, and keep the incumbent on their toes. In the Public Sector, statutory reviews generally take place regardless of agency performance and campaign effectiveness.

That’s fair enough but the best client/agency partnerships tend to evolve through mutual understanding and trust over time. Great campaigns invariably follow.

Regular internal performance reviews can ensure that any conflict issues can be nipped in the bud. Costs can be checked and transparency between client and agency can allay concerns.

In any case, pitching purely on the basis of reducing costs requires a clear understanding of the relationship between bottom line costs, value, and effectiveness. Screwing an agency down may look good but there may well be a hidden price to pay in delivery.

Therefore, the hassle of an agency pitch process does not have to be addressed regularly unless there are sound marketing reasons, such as underperformance or a need for a different strategic approach.

Selecting the pitch list

Pitch lists can be haphazard dependent on which new business director happens to call at the most opportune moment. Yet a bit of research can identify companies that might be a good fit. By selecting appropriate companies and giving them detailed briefings it is more likely that good presentations will be delivered.

No more than five companies need to pitch, and if the incumbent is definitely going to be sacked, there is no need to prolong the agony by asking them to represent!

De-brief

Much of the disharmony following a failed pitch lies in speculation as to why the agency was unsuccessful. Again some clients are very diligent about explaining their decisions but these tend to be in the minority. It is only fair that there should be feedback for agencies that have put blood, sweat and tears into their submissions so that they can improve their offering in the future.

Will everybody follow the above guidelines? No.

Will clients accept pitch fees as standard practice? No.

Why not? Because as an industry we never stick together to make a stand. There will always be somebody out there prepared to break ranks to try and steal a march on their rivals, so I guess we’re just our own worst enemies.

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