Why read this? : We look at some of the more informal ways to do marketing agency evaluation. Learn what good agencies say and do, and the warning signs of a bad agency. Read this for ideas on how to do an informal marketing agency evaluation.
In marketing, you soon learn you can’t do it all yourself. So, you find someone else with the skills you do the things you can’t. For example, contractors and freelancers for specific projects. Or marketing agencies for regular, on-going work.
As per marketing agencies guide, there are many different types of agency. They’ll specialise in services like market research, advertising, media planning and digital marketing. Plus, they’ll help you with related creative skills like copywriting, graphic design and photography.
But to access these important skills, there’s always a cost. Agency fees and implementation costs, for example. And where there’s a cost, you need an evaluation process to make sure you get your money’s worth. That’s where marketing agency evaluation comes in.
Marketing agency evaluation - formal
Big companies usually have a formal marketing agency evaluation process. They outline this in the contract and statement of work. They often use independent consultants to manage this process.
This formal marketing agency evaluation covers how the agency deliver against the business goals, and how they deliver specific services. For example, they might evaluate the agency on services like strategic planning, creative delivery and account management. There’ll be specific criteria to “score” the agency on these. To check how they’ve gone against the client’s expectations. (See our marketing agency guide for more on formal evaluation).
Marketing agency evaluation - informal
The formal marketing agency evaluation process is a professional way to manage your agency relationship. It helps you have open and honest conversations with your agency.
But it’s only effective AFTER you’ve worked with them for a while. And it takes time to decide the criteria, gather the feedback and review the outcomes.
But sometimes, you want to make quicker judgements about an agency. Rather than formal criteria, you may want to use rougher rules of thumb to make quicker decisions.
For example, you might use this more informal marketing agency evaluation with smaller agencies. Those you only use for smaller projects, or on an adhoc basis.
You wouldn’t normally write these into a contract or formal marketing agency evaluation. They come from our experience of marketing agencies, and can be used to evaluate any type of agency.
Rules of thumb - we may need a new agency
Let’s start with the bad stuff. Attitudes and behaviours which raise a red flag and drives you crazy. These are all surprisingly common. Where we can, we’ll try to explain why they might occur.
With these, bear in mind, you’re the client. It’s your money. You decide what’s acceptable. It’s up to the agency to fix it if you’re unhappy.
#1 They're inflexible on process
Marketing agencies love to tell you, you need to be more customer focussed. They tell you to listen to customer needs. Organise your business around those needs. Like you couldn’t work that out yourself.
But remember, that for the agency, YOU are the customer. And when you ask some agencies to organise their business around your needs, you find they often don’t practice what they preach.
In particular, with their processes. Many agencies have pre-defined internal processes. They use these to commission and deliver the work. This lets them move their people around different clients without having to learn different ways of working. This makes life much simpler and more efficient for them.
But if your processes don’t connect well with their processes, bad agencies insist it should be you who changes how you do things. Agencies who can’t adapt their processes to meet your needs are a no-no.
For example, as per our how to advertising guide, clients start the advertising process with the brief. The agency should respond with their proposal. It’s their answer to the brief.
But, some agencies ask to submit a “reverse brief”. They rewrite your brief to make it easier for them to work with. Your brief which you spent all that time getting just right, to be clear on what you need.
Suddenly, it’s not your brief any more, it’s the agency’s interpretation of your brief. Written so they can manage it through their business more easily.
You often find though, that this reverse brief excludes things you specifically wanted to include. Or includes things you chose to leave out.
Of course, you review these changes and keep them if they make the brief better. But if they don’t and the agency insists on keeping them, “because that’s how we do things”, this is a definite watch-out.
#2 They're undifferentiated on process
There are many agencies out there. They all claim to be better than their competitors. But when you dig deeper, you often find the inner workings of marketing agencies are very similar.
Think about it. Most agencies are full of people who worked at other marketing agencies first. It’s a closed world, where in trying to match competitors, agencies end up replicating them. That’s not good for clients.
A few years ago, we worked on a project with a business which had dozens of different agencies. They’d decided to consolidate the work into a single agency which could cover everything. The aim was to make the marketing more integrated. As one manager said, “with one agency, there’s only one throat to choke”.
As part of the pitch, we saw the RFI (Request for Information) documents for 11 different agencies. One of the questions asked them to map out their planning process. When we reviewed the responses, we could barely tell them apart.
Now, you could argue some processes are standardised. But you think all these smart advertising gurus who say you have to be differentiated would have at least worked out a way of differentiating themselves?
#3 They make guarantees they can’t keep
There’s a great quote in Bob Hoffman’s book Laughing at Advertising that marketing is all about probabilities, not certainties. Which makes it interesting when you hear marketing agencies talking about guaranteed ways to grow your business. Sure-fire strategies to grow your business, with 100% success rates.
Because, there’s no such thing. If 100% guaranteed success in marketing actually existed, everyone would do those things. And if everyone did those things, then no one would win.
Every business is different. They have different strengths and weaknesses. Different target audiences. Different competitors and different challenges to face. So, you can’t guarantee what worked for someone else will work for you. Watch out for over-confident agencies who over-promise what they can deliver.
#4 They don’t make guarantees they should keep
Now, that’s not to say, they can’t or shouldn’t make some sort of guarantees. About the work they’ll do, and how it’ll benefit your business. For example, they should be partners in achieving your business goals. When you do well, they should be rewarded for helping your business grow. But, if you miss your goals, the agency should own some part of that failure too.
For all the services the agency provides, they should give you guarantees about :-
- who in the agency will do the work.
- the quality of the work.
- when it’ll be delivered.
- what the impact is likely to be.
- what they’ll do, if there’s something you’re unhappy with.
#5 Too many people and the wrong people
The agency will put a team onto your business. And that’s fine. Except, often they won’t really explain what everyone does. And won’t share who actually does the work on the team.
At some point, you’ll be introduced to the whole team. You pay by the hour for this whole team’s time spent on your business. Even if that times doesn’t add much value.
For example, you often get billed for the time of Executive Creative Directors. (ECDs)
You find yourself paying $250+/hour for them to “review” work their junior designers or copywriters have done. That you’ve already paid for. Or for them to attend a meeting where they only talk for 5 minutes.
Not just that, but agencies who turn up with masses of people in the meeting. That might make you feel like they’re taking your business seriously. But, think about it. You’re paying for every person in the room. And that can easily be $150 to $250+ per hour per person.
If you’ve got a bunch of people only there to listen and be aware of what’s going on, you can find some meetings racking up thousands of dollars in fees. And you have to ask yourself, are you getting that value back for your business from that meeting?
Try it, next time the agency brings a big team along. Ask them how much in sales and profit the meeting will deliver. If they get flustered, and can’t come up with a decent response, that’s a bad sign.
#6 Their attitude to your money sucks
We don’t begrudge marketing agencies having nice offices. Or, doing things to recruit, keep and motivate their staff. But remember, they way they pay for their offices, their staff and all the things they do comes from their clients.
And that’s you.
We’ve worked with many agencies who take taxis everywhere. Even, if there’s good public transport. They’ll buy you coffees, take you out for lunch and have drinks in the office on a Friday afternoon.
Heck, if you’re important enough, they might take you on a “fact-finding” trip to a big event overseas.
But, all of these things, nice as they are, they’re not being generous. They’re spending your money. So, don’t be a tight-arse. But, do question your agency if their spending seems reckless.
With your marketing budget, imagine, it’s like handing over your own wallet or purse to them. Do you trust them to spend your money wisely? Because, if you don’t, that’s a bad sign.
#7 Their attitude sucks
And finally, sometimes it’s that you just don’t connect with the people. When you work with agencies, it’s important to build a strong working relationship. That doesn’t mean you agree on everything. But, you trust each other’s judgement to do the best thing for both sides.
But sometimes it feels like your agency is only doing the work for their own benefit. That they don’t have your best interests in mind. That’s the moment when you want to get out. And get out, fast.
Example : A bad agency story
Let’s finish this section with a little story about an agency whose attitude sucked.
Once upon a time, a long time ago, working as a client, we had a website agency, who wrote content for us. We reviewed this before it went online. But, we found it repeatedly full of spelling and grammar errors. It’s fine if this happens from time to time. But, with this agency, it happened EVERY time.
When we flagged this to them, their response was it wasn’t their responsibility. It was our content on our site, so we should correct their spelling and grammar before it got posted.
It then got worse. The agency offered to run an online event for us, that would have been the first such event in the category. But then, we received a mass mailing from them which they obviously hadn’t checked who the email was going to. It offered a similar event to all of our competitors, the day before our event was due.
As we said, sometimes you get an agency with an attitude that sucks. We got out of that contract pretty quickly, and found another agency to run the event for us. A week before the competitor event.
Which, fun though it’s been to share this bad agency story, does bring us on to the signs of a good agency.
Rules of thumb - the agency is worth keeping
If your business is going well, it’s likely you have a good marketing agency supporting you.
You should be doing regular evaluations with your agency anyway. These will show how and where they’re hitting your targets.
But beyond those, there are some specific outcomes and behaviours to look for. These’ll help you work out if you’ve actually got an agency worth holding onto. If you don’t see examples of these, it’s time to start asking questions.
#1 You (and #2 your customers) like their work
As we’ve covered before, sometimes when you meet with an agency, particularly the creative team, the meeting can feel like a car crash. When the agency doesn’t seem to get what you want. Or they’re pushing their own agenda. That’s hard work.
But sometimes, your agency does “get it”. They produce work that stirs your emotions. Work you like, that makes you feel good. Plus, your feedback goes smoothly. You work easily together. And you’re proud to show others the work. Those are all signs your agency is good.
If you haven’t started working with the agency yet, check out the work they do for other clients. We’re big believers the quality of an agency’s work reflects how well an agency is run. The best quality work with strong market research and insights behind it, that builds brand identity and that’s commercially successful comes from well-run agencies.
#3 They make you think
The whole point of outsourcing to an agency, is they can do things you can’t do yourself. As part of that, they should share how they think. How and where their ideas about your business come from. This outside thinking to help you understand your business differently is a key part of a good agency relationship.
It doesn’t mean everything they do has to be new and original. But it does mean everything they do has been well researched and well-thought out. It makes you think in a different way about your business.
#4 They understand how finances work
Financial savviness is surprisingly rare with marketing agencies.
They don’t have to be finance experts. But they should understand key financial terms like how a profit and loss and Return on Investment works.
If your agency understands how your finances work, they can present projects and opportunities to you that fit your budgets.
We’ve seen too many agencies present crazily-high budgets on projects that’d never pay off.
For example, the first e-Commerce project we ever worked on, our incumbent digital agency proposed it as a $600k project. This was more than our total sales target for the first year. It was too much.
So, we spoke to other more specific e-Commerce agencies. And, found one who’d do it for $60k. 10% of the original agency’s estimate. Not hard to work out which agency we used on that project. The one who understood our finances, obviously.
#5 They put skin in the game
Which brings us on to the next sign your agency is good. If they understand your finances, then the best agencies will make the rewards and risks they get from working with you more closely linked to the rewards and risks of how your business performs.
So, rather than a purely flat fee for their work, they offer to defer a percentage of their fee based on the results it delivers. If they deliver above expectation (your sales are higher), they get a bigger fee. But, if it delivers below expectation, their fee is lower.
We don’t know many agencies who do this. But a few do. And, without exception, we’ve found agencies who are willing to do this, are more deeply committed to your success. It’s in their interest to go above and beyond, because their’s a clear benefit in it for them. And on that theme …
#6 They go above and beyond
The best way you can understand how good an agency is, is how they respond when something goes wrong. Like something small such as a spelling mistake on the website. Or a major crisis that impacts your business like a legal complaint or a product recall.
At times like these, good agencies focus on fixing the problem first, and worrying about the bill afterwards.
For example, in a former business, we once had a major website crisis happen on a Friday night. It was an unforeseen external issue, but the agency called their whole team in and worked over the weekend. It was fixed by Monday morning.
This is the sign of an agency who put their customers first. So, while you don’t want to create a crisis, ask your agency what they’d do if something bad was to happen.
#7 You trust and like them
Which brings us to the final item on our informal marketing agency evaluation list. And, that’s whether you actually trust and like them.
It takes time to build up trust with an agency relationship. But if trust isn’t there, and it doesn’t seem like it’s going to come, that’s not a good sign.
But if you do trust your marketing agency, and you do like and enjoy working with them, then make the effort to keep that going. Because, it doesn’t always work out that way.
Conclusion - marketing agency evaluation
A formal marketing agency evaluation process is helpful. But often it’s the informal parts of the relationship which make a difference.
You should look out for signs in what your agency says and does that suggest they may not be right for you. That might be in their attitude to working with you. Or in the quality of what they deliver.
Good agencies on the other hand really stand out. They’re a pleasure to work with and make you feel good about the work. Those types of agency you want to hold on to.
Before we jumped into coaching and consulting, we had a lot of experience as clients, working with agencies. Check out our marketing agencies guide to find out more. Or, email us if you’ve got a specific marketing agency evaluation question you need help with.
Owl : Photo by Joe Green on Unsplash
Business meeting : Photo by Campaign Creators on Unsplash
Money on fire : Photo by Jp Valery on Unsplash
Thumb up (edited) : Photo by Markus Spiske on Unsplash
Coins spilled from jar : Photo by Josh Appel on Unsplash
Handshake : Cytonn Photography on Pexels