Hiring an agency, whether it’s your first or a replacement for your existing partner can be daunting. In either case, you’re in the situation because something has changed at your end or at theirs … and to keep growing your brand community – and your business – you need a new partner. Fact is, Brand Communities are built on trust. Hence, a key responsibility of an ad agency partner is to fuel your marketing efforts with an emotionally inspiring narrative that establishes and builds trust with current and potential customers. Picking an agency that gets that, requires some practical thinking about who you are so you can find the agency that fits your situation.
Here are four steps to consider as you prepare for a new advertising/branding partner. And one essential reminder about how to avoid getting stuck in the wrong relationship.
STEP 1: Determine Your Organizational Archetype
Before making that all-important call or email to an ad agency, ask yourself: “What type of client does your organization want to be?” According to Opentext, an enterprise information management leader, there are four types of organizational archetypes:
Do you have a reputable brand, serviced by an in-house marketing team who are managing substantial budgets and juggling multiple creative, strategic or even media vendors out-of-house? If so, your brand is likely a “Residential Expert.” One characteristic of this type of company is a good number of them (nearly 30%) wish they could outsource everything, provided they have overall control of the process.
Residential Experts typically:
- Prefer to outsource projects which fall out of their business scope. They’d rather tackle existential growth challenges such as product innovation, acquisitions and joint ventures.
- They tend to trust their own team’s capabilities to be in charge, but not necessarily in control of every advertising or branding detail.
- They are keen to collaborate with their outside vendors, but are constantly checking in to ensure project deadlines and budgets are being met.
Tip: While you ultimately know the core values of your brand better than anyone, embrace collaboration! Being open to opportunities presented by a proactive agency will support your growth objectives and hone your competitive edge.
Take the Reins
Maybe you’re a start-up, or more likely, a growing organization whose expertise is all about the products or services you offer. You aren’t branding or advertising savvy, per se, but you recognize how essential it is to your success. Chances are your organization is looking for an agency to “Takes the Reins.” You’ve got a moving company and branding and advertising is not your strong suit. Before something important breaks loose and runs out of control, you want an external marketing department that will wrangle it and multiple other projects expertly.
Organizations that Take the Reins typically:
- Have one or two people who are overworked or not up to the more challenging aspects of strategic planning, creative development or on-going account management. But they are devoted to the company and coordinate company and agency efforts with an energized attitude.
- Highly value their agency partner’s expertise. They can expect a considerable amount of work to be completed in an unrealistic period of time; but their relationship with the agency is positive, transparent and reason tends to prevail on both sides of the table more often than not.
Tip: If you are a “Take the Reins” type of organization, work with your agency to further strengthen the foundation of your brand as you aspire to be more of the “Residential Experts” outlined above.
Working with an ad agency partner as a “Take the Reins” client is entrepreneurial. You want a partner who gets that, who can roll with the punches and who can keep their balance – while keeping your brand’s DNA healthy and consistent project after project.
Do you have a structured organization, with a marketing department consistently electing to manage longer-term projects internally? If so, your organization best identifies as being “Specialist Seekers.” You’re looking for an agency that offers a limited set of skills useful for a particular, almost surgical assignment. Once it’s done, you move on (provided you survive the operation!)
Specialist Seekers typically:
- Do not need or want an official or long-term agency partner to play a key role in fuelling their primary marketing efforts.
- Need some assistance on short-term projects. If they do work with an agency, they will look for familiarity and experience.
- Enjoy the challenges of marketing their business themselves, BUT will always value the expertise that a capable and engaged ad-agency partner brings to the table.
Tip: Be transparent with your ad-agency partner. Make it clear whether the partnership will be long-term from your initial call with them. This will help determine whether the partnership will be the right fit from the very first project and onward.
STEP 2: Get a Clear Understanding of Budget & Time Resources
You want the growth needle moving in the right direction in a way you can manage. Identifying your organizational archetype from the onset will ensure a partnership flourishes into a long-term relationship that benefits everyone. Before you hire your ad agency partner, circle back to clarify client-agency expectations. Differences in expectations erodes client-agency relationships faster than anything else. In a June 2019 article by AdWeek titled: The Ad Industry Has Reached A Breaking Point. Can It Bounce Back?, many client-agency relationships have hit an all-time low.
A key reason is the “ROI expectation”, as both clients and agencies continue to struggle throughout the negotiation process. Some agencies believe they need to be more appropriately compensated for their work, while clients believe the compensation they are offering, combined with the opportunity to service their brand is more than enough.
Kim Wijkstrom, SVP/Chief Marketing Officer at Vanda Pharmaceuticals states: “If you want Michelangelo, you have to pay for it. The Pope wanted the best Creative Director of all time and he didn’t get it for free.”
A healthy understanding must:
1. Provide professional service to the advertiser.
2. Fairly compensate the agency for its work.
3. Be reviewed periodically. And most importantly:
4. Grow the client’s business. Period.
Determining how much to invest is tricky because your financial forecasts are always a moving target. Sometimes, that number is based on a percentage of sales; other times you need to load the investment from the front-end based on a forecast. For organizations that want to “Take the Reins”, we recommend a minimum of 15% of gross sales and as much as 30% based on business planning, to achieve a minimum of $2 million in the first year.
For organizations who are “Residential Experts” or “Specialist Seekers” and are generating between $10 million and $50 million in revenue, that budget allocation tends to drop to between 10% and 15%, again based on forecasted growth. It’s also important to include other costs that get tossed into the mix such as retail listing allowances and even salaries.
STEP 3: Make the Right Calls & Ask the Right Questions
When you have determined the type of organizational archetype you are, it’s time to make the right calls.
Some ad agencies can be just as guilty of not identifying their own organizational archetype. At Blade, we are an Outlaw brand. We believe in freedom, non-conformity and creating exponential growth for our clients, even if it means we need to break some rules along the way … legally and tastefully.
If your brand has seen gradual growth with the internal success of your business, you may be ready to work with an ad agency. Before making the calls, ensure you make the right ones! Review their portfolios and evaluate their thought leadership activities to determine whether their process and vision aligns with the archetypal nature of your brand.
Tip: Here four important questions for you to consider in the initial call:
1. What is your agency’s process to understand our situation?
2. Who will work on the business? Will the senior people who are on the first call disappear to be replaced by juniors?
3. What is your perspective on branding and how will it help grow our brand?
4. How does your agency measure the effectiveness of campaigns?
An agile agency with a track record of success in servicing clients like you is important. And the words “like you” are key. Insisting that the agency already has a similar client relationship in the exact industry might enhance your comfort level. However, that herd mentality can also erode any chance that your agency will explore breakthrough ideas outside the confines of your industry.
STEP 4: Evaluate the ROI You Expect from The Collaboration
Let’s face it, you’re not going to hire an agency because everything is going well and you have everything under control. You want to grow your business by growing your brand community. That means more leads, more engagement, more conversations and more sales coming into your business on a sustainable and positive trajectory.
What you don’t want is explosive growth that has unintended consequences on your ability to deliver goods or services. And you sure as hell do not want to wait forever for things to turn around in a positive direction once you have all of your ducks in a row. In addition to having your advertising and branding in place, your sales and delivery teams need to be up to speed on your organization’s trajectory so they can play a pivotal role in supporting the re-energized brand as it goes to market.
The Right Agency Will be a Profit Centre for You – Not a Cost Centre
Proactive results-oriented agencies employ dedicated teams to fulfill the goals on every project. You’re paying them on an hourly basis and while the agencies’ overhead is covered in those fees, it reduces your overhead, turnover and time spent in the hiring process. An experienced agency will have several seasoned professionals to collaborate with you and your team, minimizing the amount of time you need to invest internally because the work is progressing at the agency.
If your organization uses a “Take the Reins” approach, you’ll need fewer staff to manage the process; and the agency will help establish timelines to keep the project on track without having to interrupt your staff to resolve operational or production issues. If your organization is a “Residential Expert” or “Specialist Seeker”, establish expectations to create a balanced level of involvement between your internal staff and the agency. For example, you may consider scheduling internal meetings with your team to review the agency’s performance on a bi-monthly basis.
In any case, you hired the agency to help grow your business. If you let them fulfill their role with minimal supervision, projects will move forward smoothly and more productively, taking less time and saving you money in the process. This will also ensure financial costs are monitored through strategic planning, in collaboration with your ad agency partner.
The Essential Reminder
Partnering with the right ad agency should be inspirational, productive, profitable and fun. You should feel empowered about the process of creating exceptional branding and advertising. But you don’t want to babysit the agency, bog them down with countless revisions and details you forgot to provide in the initial brief; or worst of all – spoon-feed them every bit of direction because they turn out to be muppets.
Tip: Once you’ve followed all the steps listed above and have established a clear understanding of who you are, what you need and who seems to be the best fit, ask that one final question you should always ask when considering an important, long term relationship: Can you spend an hour stuck in an elevator with these people? If the very thought causes you to shudder, keep looking.
*This column was created from a collaboration between Blade’s Account Executive/Project Manager, Andrew Basso & President, Wayne S. Roberts.