Agency Guest Blog: By Jim Rothnie, Business Development Director, McCann Manchester
(10 minute read)
If you put a group of agency CEOs, MDs and New Business Directors in a room, the chances are that within a few minutes the conversation will turn to the subject of intermediaries and consultants.
And depending on which of those agency heads has won business through an intermediary recently, the conversation will go in one of two directions.
For the winners, they’ll be waxing lyrical about the intermediary in question and how great their relationship is with them.
For those who’ve not won a piece of business, they’ll probably go to the default setting of complaining how they never get any opportunities from an intermediary and when they do, they’re only on the list to make up the numbers and never really stood a chance of winning.
Who said life was fair?
For agencies, it is all too easy to develop an almost unhealthy obsession with intermediaries and consultants. After all, a single phone call from an intermediary to put an agency on a pitch list can be transformational for the agency if they win the pitch.
But what about from the client-side of things? After all, an agency-only gets an opportunity to pitch via an intermediary if there is a client who is looking for an agency. What role can an intermediary play for a client and what are the benefits of using an intermediary to help you as a client find your next agency partner?
Who and What?
So, let’s start at the beginning – who are this group of people and companies lurking inside every agency New Business Director’s mobile phone speed dial?
Basically, intermediaries and consultants are a group of people and companies that help clients find potential agency partners. Most of these individuals and organisations do a whole lot more besides from business consultancy and benchmarking right through to training to cite just a few examples.
But sticking with the process of helping a client find their new agency, the intermediary/consultant can play several roles within the process and all intermediaries have slightly different operating models.
If you’re a client, why use an intermediary or consultant? The answer is simple. Most agencies think clients have an encyclopaedic knowledge of every agency and especially their own. The reality is somewhat more prosaic.
As a client-side friend of mine once said,
“Most clients know the names of three agencies. The one they’re working with, the one they’ve fired and Saatchi and Saatchi.”
Put simply, if you’re a client and you’re looking for a new agency partner and you want to find the best possible candidate, you could spend a load of time researching a long list of potential agencies, or you could engage a consultant or intermediary to work with you to help you define what you’re looking for and build a list of potential providers.
The advantage of this is that the intermediary will know who the most appropriate agencies are in the market for the given task which means you the client get to your brief and your long list faster. They’ll also have a good feel for the people in the agency as well as their work and whether they’ll be a good fit.
The other advantage for those clients who already have a good idea of their long list is that an intermediary can broaden the client’s perspective by introducing agencies that might not be familiar to the client. Such agencies might have a different way of working or a specific approach or skill set that could be well suited to the client.
So, if you’re a client looking for a new agency, either because things might have run their course with the existing agency or because you’ve got a challenge and requirement that is outside the capabilities of your existing partner, how does it actually work? The answer to that depends on the intermediary or consultant you engage because all operate slightly differently.
Some will act as a consultant from helping shape the brief to drawing up a long list and working right through running the pitch process all the way to commercial negotiation.
Others will help you get a long list together before passing responsibility for running the pitch back to the client. And there are a whole lot of different operating models in between.
Some will charge you the client for their time, whereas others will ask the winning agency to pay a percentage of their first year’s fees as a commission.
It is also worth noting that many intermediaries will levy an annual membership fee to agencies on their books. This effectively means the intermediary will prioritise those agencies to make sure they really understand their capabilities which for the agency means they’re more likely to see a brief from an intermediary.
It’s worth noting that many intermediaries that run a membership model will compile pitch lists that are a mix of member agencies and non -members – especially if the client has particular agencies they want on the list.
So, What Are The Benefits?
If you’re a client an intermediary can help save you a load of time in the long list process and will bring a detailed understanding of the agency market to the table.
A good intermediary will act as advisor, counsellor and challenger helping you the client get the process right and the all-important brief right.
It’s easy to forget, but agencies do judge clients on their pitch processes and word soon gets around if a client has been shoddy in its pitch practice.
And generally, for agencies, if there’s an intermediary involved in a pitch that’s seen as a good thing because it means the client has taken the time to bring in someone to support them in the process.
The other thing worth remembering is that most clients (certainly the good ones) are not running agency pitches very often so may not be very clear on what the expectation of the agency is and how the process needs to work. Again, this is an area where the intermediary “does what they say on the tin” ie act as the go-between and guide between agency and client.
And it’s that role in the wings as a “horse whisperer” that a good intermediary will really earn their keep with the client (and indeed the agency). There are occasions where a client has a great chemistry meeting with an agency, they like most of the people, the approach, thinking and experience, but they just can’t gel with a key member of the agency team.
This is where an astute intermediary is invaluable and can guide the agency with guile and sensitivity to sharpen their casting.
It’s also worth remembering, and very easy to forget that pitching costs agencies money, and in many cases, we’re talking big money. The first element of the financial outlay is time. A big pitch in a big agency can easily burn time running into a value of six figures.
While the cynical might argue that it is not “real time”, the reality is to the majority of agencies that work on time-based billing, that this is time they could have charged to a paying client.
The second element is the hard costs. A pitching agency will often look to undertake market research, maybe test concepts with consumers, spend time visiting a client’s outlets etc and it’s surprising how quickly you can clock up four to five figures worth of hard costs on a big pitch.
Selecting a new long-term agency partner or selecting an agency for a high-profile project are both big steps for a business and it’s not something most clients can afford to get wrong so having an independent objective voice in the shape of an intermediary can be hugely beneficial.
But What About Procurement?
Most large client organisations have procurement departments with considerable expertise and resource. In some cases, those departments will have a detailed understanding of the agency landscape and can act as a pitch consultant from start to finish.
For those companies not blessed with such buying and sourcing expertise, procurement may be more focused on direct procurement rather than buying indirect services for the business.
That’s where a consultant or intermediary can work very effectively alongside a client’s inhouse procurement specialists.
Ok, So How Do I Go about Finding An Intermediary?
If the intermediary or consultant helps clients find an agency partner, how does a client find a suitable intermediary?
That’s a bit like the old conundrum of how does the snowplough driver get to work if he or she hasn’t taken their snow plough home with them the previous evening?
The good news is that unlike the agency market which is overserved, there are comparatively few intermediaries and consultants with an in-depth knowledge of the agency landscape so a combination of a Google search and speaking to colleagues and peers should allow you to track one down pretty quickly.
All you’re then left with is the challenge of what process do you use to select the right intermediary to help you run your agency selection process.
Anyone seen that snowplough driver heading home from a hard day’s ploughing?
Published date: November 5 2019