Posted by Blame the agency.
A friend who owns a marketing agency once half-jokingly said to me that an agency is used in two capacities:
- Good capacity: when we do everything great and have a huge win. In this capacity, the Chief Marketing Officer takes all of the credit.
- Bad capacity: when a campaign or marketing initiative doesn’t fly. In this capacity, it’s the agency’s fault.
It’s true. It is correct.
The role of the agency is to act an agent on behalf of the brand. It is not to take the credit (the credit belongs to the brand). So, when things aren’t going well, the agents often do need to be changed… whether the agency likes it or not. The past few decades has given rise to marketing agencies that have become nothing short of rock stars. The past few decades has also given rise to agency talent who are nothing short of rock stars as well. It should come as no surprise that everybody wants to be partners with the rock stars. Yesterday, MediaPost ran a news item titled, Cutting Rosters: Clients Unhappy With Agency ROI, Performance, that rattles off a litany of issues that brands have with their agencies.
The problems include:
- 44% of brands asked think their agency roster is too big.
- 69% of brands asked said they plan to cut back on digital agencies.
- 48% of brands asked said they plan to cut back on creative agencies.
- 71% of brands asked site frustration with accountability in terms of demonstrating ROI effectiveness.
- 85% of brands asked say that the major advertising holding companies have not improved their service and they are viewed as "inefficient."
- 72% of brands asked said that agencies are "inconsistent and need to improve" on delivering integrated solutions.
It’s not pretty, is it?
The news item is based on a study done by Avidan Strategies (no link to the study and no additional information to support the context, sorry) and – in a nutshell – it’s telling a narrative that goes something like this: "Agencies need to be better, faster and more creative in the digital world. Along with that, agencies need to prove results and get a whole lot better at delivering ROI through proven measurement, while creating better and more integrated solutions. Oh, and by the way, we plan on cutting down on our digital rosters even though we’re even more disappointed in the work coming out of our big, traditional agency."
What’s going on here?
There used to be a time (oh boy, here I go starting to sound like an old man…) when the agency and the brand were partners. Where they sat at the table, side-by-side, and worked late into the night, sweating out the details to deliver the results together. Now, we’re in this strange game of finger-pointing and blame (if we are to believe the results of this study).
The question of ROI.
Reading between the lines of this MediaPost news item, one thing is abundantly clear: we can’t be asking the question of ROI at any point except in the planning stages. If the brand and agency both agree on what metrics will be used to target against ROI in the briefing and planning phases of a campaign, something tells me that a lot of the woes, pains and struggles would be resolved. All too often, our marketing world is filled with vapid briefs that lack true acquisition costs, investment expectations and the desired outcome. ROI needs to be baked into the solution (and it needs to be realistic). Trying to define it after the campaign has begun is not only futile, but lacks credibility and professionalism. We can enhance the marketing experience and manage expectations starting at this very moment. Every brand and agency partner needs to agree that all measurement and metrics associated with return on investment will be formalized and agreed upon prior to delivering anything else.
I wonder what type of wonderful marketing world we could have if just that one thing were to become a reality?
Never another podcast episode or article 
It’s funny, we both looked at this information and took two separate roads. I was looking at how the current drop impacted new business for agencies… Taking this data and turn new business into a math equation whereby any good marketing firm should know how many leads they have coming in each month.
http://sandersconsulting.com/newbusinesshawk/how-many-new-business-leads-are-out-there
Now to your points, I go back to some of the points I make here some time ago… the number one reason the churn is so high is marketing firms lost the valuable high ground. It’s now occupied by consultants… Their world had been reduced – squeezed between the new consultants strategically and a new breed of creative shops tactically. This is what we call the Bipolar Client. The strategic side is focused on areas of great import – where perhaps a “Big Idea” can once again transform an industry… where traditional ad agencies are no longer invited into the board room – “creative” is viewed as tactical. The tactical side is focused on containing cost and providing incremental growth – sales and marketing. The rule here is do NO HARM! And design/freelancers/project shops are growing. And it’s damn easy to change a tactical shop…
B
“Asked what their main area of frustration is with agencies, 71% responded that it is accountability.”
That really gets to me. And it’s hardly a surprise either. Last week I sat in on a briefing after just reading through the campaign pitch deck for the first time. One question I asked was, “what do they (the client) hope to accomplish? [It’s not in the deck.]” I emphasized that if there aren’t any goals, then the client could come back and say we didn’t do a great job. But there’s really no argument for either side. Both sides failed to set and agree to goals together.
My question was answered with agreement but without resolution or a plan to figure it out.
And on top of that, I’d love to know how they plan to learn and improve from this campaign without having any expectations/goals… This wasn’t the first time this has happened.
I try…maybe one day a culture of accountability will come about.
Thanks for sharing this Mitch, it’s definitely an issue that needs some addressing (at least from my experience).
You’re correct on all points. Traditional ROI measurements just don’t equate to what social & digital marketing actually do. Marketers measure ROI as we spent X, we earned Y, how do those compare.
How do they compute the ROI of customer service? Many bits of social aren’t about “marketing.” That’s what people don’t understand yet. When you’re doing social as customer service and social as branding and social as conversation, you’re not doing social as “increase earnings” and “marketing.” The sooner we figure out how to get that into everyone’s heads, the better.