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Agency Marketing

Why the traditional ‘fixed retainer’ is living on borrowed time

By Luke Regan | managing partner

DAC

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The Drum Network article

This content is produced by The Drum Network, a paid-for membership club for CEOs and their agencies who want to share their expertise and grow their business.

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October 10, 2016 | 4 min read

For all the time that the marketing industry spends promoting product and service innovations, the basic business model underpinning most client/agency relationships hasn’t evolved much in decades. However, there are growing and undeniable signs that, for many clients, the traditional ‘fixed retainer’ relationship simply doesn’t work anymore – and agencies must respond to address those concerns.

Luke Regan of DAC Group Europe.

Luke Regan is VP managing partner at DAC Group London

Late last month, DAC Group London (formerly Make It Rain), the digital agency specialising in location-based lead generation, launched a new Flexible Performance Plan, enabling new and existing clients to tap into channels and consultant expertise, as and when they need it.

The scheme is designed to offer clients more choice about how they bring in agency services and knowledge. Clients will receive access to the capabilities of DAC’s full agency team, on a flexible basis, and pay in line with the services utilised and the performance that is delivered.

One of the issues facing marketing directors today, and particularly those in the retail sector, is balancing the competitive advantages of building a highly skilled in-house team with the value of hiring external experts they can trust, at the right moments. The pace of change in marketing technology over the past decade has been staggering, so it is perfectly natural that each individual client has a different mix of skills and resources available to them in-house. However, it can often be a tricky and time consuming task to find an agency or consultant who is happy to engage with your unique requirements on a flexible basis at a reasonable fee level.

Similarly, for agencies, working with a client on a project-by-project basis can be challenging. Such clients don’t always see the value in a fixed retainer service for any one channel, and so the agency is faced with the dilemma of either walking away from the business or taking it on at an unprofitable fee, while hoping it matures.

The new Flexible Performance Plan responds directly to this growing market need. For an affordable monthly fee, linked to performance, clients will be free to use the agency’s skills and time as required, and where they can have the greatest impact.

Additionally, clients will have the ability to switch between channels, dedicating resources to where they are needed most, to ensure activity falls within their budgetary limits. One month could involve an SEO audit, while another could involve a website migration plan and PPC review.

It has become clear that the agency retainer model no longer makes sense for every client, and it’s important that we respond to evolving needs and develop our services accordingly.

Our Flexible Performance Plan offers a much-needed solution for clients that face challenges with budget and digital marketing ROI, but are nevertheless keen to extend the capabilities of their in-house team with our breadth of skills and experience.

If you need a skilled, trusted agency on hand for project work, combined with the intense commitment of a long term partner, then this is for you. And by incorporating performance-related pay, we will always be motivated to deliver meaningful results.

Luke Regan is VP managing partner at DAC Group London

Agency Marketing

Content by The Drum Network member:

DAC

DAC is one of the largest independent digital media agencies in North America, with a growing international presence and offices in the US, Canada and Europe. We drive transformational growth for our clients with integrated, data-driven solutions. We combine best-in-class digital media expertise with deep knowledge of our clients’ businesses to strategically engage customers, no matter who they are and — uniquely—where they are.

With digital strategies powered by an unparalleled enterprise-to-local heritage, DAC helps brands—especially those with distributed local footprints—reach the right people with the right message at the right time. DAC offers a unique suite of integrated services—including paid search, data analytics, content strategy and local presence management—that are deployed in unison to drive transformative growth. Data-driven insights, hands-on management and 46 years of experience connecting businesses and customers all the way down to the hyperlocal level.

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