It’s imperative that strong agency/client relationships are maintained and nurtured
Clients need and want to be loved, understood, cared for and ultimately receive exceptional service from their agency. But there are always rivals out there only too eager to entice your valuable clients away. One area where the agency/client relationship so often breaks down is the failure of the client to deliver the right brief, which ultimately means the agency is unable to deliver the right solutions at the right price. Complications in this fundamental area always lead to the failure of the relationship and ultimately both parties going their separate ways.
The Observatory recently conducted research into the briefing process – the findings of which highlight some potential failures in the client/agency briefing process. As we teeter on the brink of a recession, perhaps now is a good time to explore this area, so that if the recession bites your agency is able to spot potential problems in a client relationship before it is too late.
SCOPE OF WORK
The ability to define the Scope of Work – how reliable it was, and for what period of time – is a key issue in any client/agency relationship as an agency’s ability to accurately cost fees correlates directly with the client’s ability to accurately define scope.
The survey underlined core issues here with one in five clients only occasionally providing a SOW. Of the 80% who regularly provided a scope 33% said that it was detailed/very detailed. Four out of ten agencies, however, indicated that around half their clients fail to provide a detailed scope at all.
In the current economic climate, one recognises that there is a need for flexibility. It is interesting therefore to note that over 70% of clients supply an annual scope to their agencies – though the agencies suggested that this was nearer 40%. It could therefore be concluded that while annual scopes may be made with every good intention, they simply have to change and the effects are inevitably felt more by the agencies than the clients. This is certainly borne out when we examined Degree of Scope Change. Agencies definitely reported a greater amount of scope revision than did the client fraternity.
85% of clients recognised that scope would change during the course of the year – 40% suggesting that might happen once or twice a year, the balance more regularly and a not insignificant 10% suggesting that it could be monthly.
Agencies claimed that all of their clients had some change of scope at some point over a 12 month period.
Clearly if scope changes to any great extent, then some form of re-negotiation will need to take place and nearly 80% of clients accept this. However, when looking at it from the agency perspective, only around 20% of agencies claim that this happens, with half of the agencies questioned believing that only up to 25% of their clients are truly prepared to re-negotiate.
Scope creep can arise from a number of different sources – actual additional work and, from the agency point of view, re-working of activity presented. All of the clients questioned indicated that work had to be re-visited from time to time with around 50% saying it was a very regular occurrence. Agencies had a broadly similar view.
However the reasons behind this re-work was seen very differently from client to agency.
70% of clients believed agencies failed to crack the brief first time round
Nearly three quarters of clients (70%) claimed that further work had to be done because the agency failed to crack the work first time round whereas 9 out of 10 agencies saw that happening only rarely or occasionally. Agencies clearly saw the problem as being poor briefing – again around nine out of ten agencies citing this as the reason. A rather alarming 37% of clients, however, admitted to poor briefing from time to time on their behalf being part of the problem.
As for additional monies for reworking, 15% of clients have experienced agencies attempting to charge for work which hasn’t cracked the brief, which inevitably will be a source of irritation.
Conversely, when the briefing is poor (and acknowledged to be by the client) less than a third of clients ever get asked for additional contributions from the agencies – possibly a surprising figure when you consider there is an acknowledgement that poor briefing accounts for the need to re-work up to 40% of the time.
Around 15% of clients acknowledge that their briefing is poor – agencies reckon it’s nearer 30%.
Drilling down further on the question of briefing, clients were asked how good they thought their people were at briefing, and agencies for their equivalent view on this critical client skill. At one level, ‘satisfactory’ (which, of course may be damning with feint praise), clients on themselves and agencies on clients score pretty much the same – around the 60% level.
However twice as many agencies than clients felt that briefing capability was poor, 28% against 14%, but even that lower figure from the client’s own assessment is rather alarming, especially when one considers that poor briefing can account for re-working in around 40% of cases. Undoubtedly, despite the issue of briefing being a long standing problem within the industry, there is still considerably further to go to improve standards and gain agreement on quality standards between clients and their agency counterparts. But it’s not just the brief – it’s what happens when the creative work is presented and fails to hit the mark. Clients’ evaluation ability is equally important.
CREATIVE EVALUATION SKILLS
There was a slightly better degree of alignment on this question – at least at the lower end of capability with around 10% of both clients and agencies believing ability to evaluate properly was poor. In the ‘satisfactory’ area there was quite a big difference – 65% of agencies claiming this of their clients against slightly less than half from their counterparts.
32% of clients believed they were good at evaluation, and a further one in ten felt that they were very good. The agencies, of course, didn’t see this in quite the same way. They believed that only a quarter of their clients evaluated well, and as for being very good, no agency gave even one client that accolade.
When it came to feeding back to the agencies, there was an almost parallel picture to evaluation abilities, though clients acknowledged that over 20% of their people were poor at doing this. Again the biggest differential was in the good/very good area with 40% of clients claiming their people achieved that level, whereas the agencies took a much dimmer view at 25%.
Clearly, there is a significant juxtaposition in views expressed by clients and their agency counterparts on these capabilities.
So how well do agencies and clients understand each others processes in relation to briefing and evaluation?
Both parties had a high degree of agreement regarding the importance of agencies’ understanding of client process (around 90%) – interestingly, however, only 50% of agencies thought their people had a good/very good level of understanding of client process.
So, the client community feels that it’s not getting great value from their agencies. Agencies are eternally bemoaning the fact that their margins are wafer thin. It’s a perennial conundrum and it’s not going to go away – the current financial turmoil will see to that with inevitable further shaving (or, more likely laceration) of budgets despite the marcoms industry’s pleas to maintain spends to sustain strong brands in recessionary times.
But the fact that there is a problem in the first place suggests that something is going wrong with the way that the two parties work together. Most clients take special effort to appoint the right agency when they decide to work together and, believe it or not, agencies don’t go out of their way to annoy clients by overcharging for work.
So why do these issues arise so regularly? Firstly, all too often agencies are being asked to cost against a less than specific scope of work. Sensitive to client cost concerns, agencies will make their best estimate against what they know the client will require of them, but without the full picture.
The chances are that they are going to under-club the costs, and then as there is inevitable scope creep, the problems start.
Invariably clients are going to need flexibility with their activities – especially when market conditions are tough; but it is critical that both client and agency thrash out a logical scope that has caveats built in so that both parties are clear on what can potentially happen during the course of the year, and what the ramifications on the bottom line are likely to be. Importantly, especially given the economic climate, agencies need to be unified and ensure that they are estimating at realistic market prices rather than attempting to undercut each other. Such short term-ism will inevitably damage the long term value of their counsel and craft.
Equally important, clients too must avoid the short-term game as budgets get thinner, because if they don’t, they must recognise that the agency will have no space in which to play if the scope alters significantly but the available monies remain the same. Other, of course, than to reduce the quality of personnel/service.
Despite the sometimes apparent alchemy used in creating great work, the reality is that the initial process of producing such work, of whatever type, starts with simple, logical and practical steps - namely the writing of a great brief.
Again the research points to the fact that all too often this isn’t happening because the quality of briefing is not up there. The simple fact of the matter is that very often junior and sometimes well established middle management marketers have never been given formal training on brief writing and have learned, all too regularly, on the job.
Unless a brief is well thought through and well delivered it will leave the agency second-guessing and presenting work which is not what the client expected.
We are all aware what happens to training budgets when times get tight. But the reality is that the amount of re-working, with all the implications on cost, delay and frustration (from both parties’ point of view) is largely unnecessary if the brief is right from the outset.
Indications are that there could be up to a 25% saving on cost if the process was tightened and all parties were performing at the maximum of their abilities.
The same applies to evaluation and feedback skills. If the creative work isn’t right (or nearly right) first time round, then the agency needs to understand why and be given clear and concise guidance on where the issues lie.
Providing a vague response to problem work will compound the overall situation and leave the agency blindly struggling their way through, only to return with further inappropriate outputs. It’s the beginning of a downward spiral as disappointment is layered on disappointment, frustration layered on frustration. That, combined with client concern over impending deadlines and agency concern over spiralling time costs (not to mention internal de-motivation), has all the makings for a breakdown in the relationship and the inevitable danger of a pitch situation ensuing.
Finally, whilst clients and agencies both agree that it’s critical to understand briefing, development and implementation processes, the evidence is that, all too often, only lip service is paid to these fundamentally important elements.
An agency having a genuine understanding from the outset on how the brief has been formulated and what the criteria are for evaluation will almost certainly approach work differently to an agency who really doesn’t know what to expect.
If agencies don’t understand the ground rules, the chances are, they won’t get it right first time. That means that right from the moment they leave the briefing the likelihood of excessive degrees of agency time-burn is high.
Little wonder agencies are feeling the pinch – especially when, as we’ve seen, clients are unlikely to want to pay for the extra work.
The Observatory train clients in the following areas: