Relationships. They permeate every aspect of our lives – both personal and business. There are good ones and poor ones. Some we look forward to and others we tolerate.
Business partnerships assume a prominent role in the strategy of leading firms, large and small. Successful business partnerships are built on trust, confidence, understanding, and mutual success. These relationships require a pro-active effort to sustain and are critical to future growth.
Client-agency relationships are one of the most complex in the business environment, requiring a substantial level of collaboration to be effective.
While top agencies in the U.S. admit they are not doing their best work for many of their clients, "creative genius" is not always the key component of the success or failure of the client-agency relationship.
Despite their promise, many partnerships fail to meet their expectations. Numerous studies confirm the sensitive nature of partner relationships: 30% Fail; 17% Eventually wind down as priorities and people change; 39% Achieve/exceed initial expectations; 9% Bought out by a partner; 5% Spun off as independent; 20-25% of all outsourcing relationships (marketing, finance, IT, manufacturing, etc) fail within 2 years and 50% fail within 5 years; 31% of alliances are seen as limping along in some suspended state of under-performance. The trend in client-agency relationships is to terminate those that under-perform. In 1984, the average client-agency relationship tenure was 7.2 years. By 1997 (13 years later), that number declined 25% to 5.3 years.
If the trend continues, by 2010 clients will search for a new agency every 4 years.
Action Steps
The best contacts and resources to help you get it done
Select an ad agency search consultant.
A successful client-agency relationship is essential to a firm's success. High financial, emotional, and strategic costs are associated with frequent partnering shifts. Clients must promote open communication and seek feedback to ensure the relationship continues to meet the expectations of all involved and endures over the long-term.
I recommend: The Bedford Group Agency Consultants. The Bedford Group focuses on marketing strategy, organization design, communications strategy, and agency search/negotiation. Specialized area of practice involves high-value client relationship research.
Evaluate and repair client-agency relationships.
Relationships can encounter rough terrain due to poor leadership & strategic advice, diminished creative quality, missteps, bottlenecks, organizational restructuring, and more.
I recommend: The Wall Street Journal, "
Now, Often, the Agency Is the One Walking Away." On Madison Avenue, breakups between agency and client are usually made to look amicable, but of course they seldom are. Behind such splits is almost always a souring relationship -- and the industry seems to be seeing more of them.
Agency compensation, review, and negotiation.
It is important to settle cost and payment disputes with marketing partners.
I recommend: Seven steps toward better negotiation. Negotiating pay at the time of hiring is a crucial process. The candidate has to seize the initiative right from the start and be on the offensive for succeeding in the compensation negotiations.
Tips & Tactics
Helpful advice for making the most of this Guide
- Distinguishing Qualities of a Great Client. Obviously, sustaining a successful relationship is a two-way street. Neither just the client nor the agency can exert all the effort. On the client-side, there are a number of simple attitudes and behaviors that foster communication and create a long-term, successful client-agency relationship.
- Instill a spirit of partnership in the relationship. Avoid the superior/subordinate relationship characterized by an atmosphere of mistrust, lack of respect for the agency's expertise, and undercurrents of intimidation. These tactics have no place in a partnership. Using fear of dismissal to "deal with" an agency undermines trust and productivity. The best advertising is only created in the absence of fear. A successful joint effort is achieved only through mutual respect of intelligence and expertise.
- Agree on a clearly defined objective of the advertising you wish to create. Failure to define or agree upon the precise purpose of advertising dooms the creative process from the start.
- Give the agency the opportunity to be totally absorbed in your product, people, and culture. Exposing agency people to client weaknesses and secrets costs more money (service time) and involves some level of risk. However, great clients totally immerse their agencies in their product. When an agency team thoroughly understands it's client's corporate culture, it will more likely create campaigns that endure.
- Create an environment of experimentation and be prepared to pay for failure. Great clients want advertising that stands out. However, nothing predicts mediocrity in advertising so precisely as a risk-aversion environment. Although it's natural to want to conform to rules and formulas in quest for a measure of certainty, elements of the development process are inherently uncertain. Trust that the outcome will be viable advertising.
- Be wary of change for change's sake.
The first purpose of advertising is to create a distinctive image for a client. Imitating a trend, by definition, fails to achieve distinction. We believe success in advertising is achieved by finding a long-term positioning and sticking with it.
- Treat the agency people well. Great clients know it's human nature for people to work harder for their friends than for business acquaintances. Facilitate an environment of friendship and collaboration to get more out of the agency.
- Keep approvals simple and disapprovals kind. Nothing saps an agency's energy more than presenting the same work over and over at succeeding layers of the client organization. Be honest. If you don't like something, say so. Be specific. Don't ask for a new execution simply because this one "doesn't do it for me".
Be kind. Think of the commentary as if you are evaluating the person.
- Make the agency responsible for the advertising and give them the authority it needs to do it. Too much involvement consistently denies the agency the ability to realize its vision. Some clients use lack of involvement to avoid sharing responsibility for a poor end result. Great clients state precisely why they disagree, then challenge the agency to find a solution both parties can agree upon.
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