The perception of media agencies as lacking in transparency, and therefore trustworthiness, has long been a challenge. The events of the last twelve months, centred around the well-publicised issues at Mediacom, have sparked huge debate on the topic of agency transparency in the Australian market and beyond. In this session we discuss ways in which trust barriers could be overcome, and what you as a marketer need to consider in order to build a better relationship with your media agency.
This is the transcript from the TrinityP3 webinar where David Angell, TrinityP3 Media Lead and General Manager Melbourne.
So if that’s what you want, how can you get it?
The simplest way to frame your thoughts around how you get what you want from the agencies is to apply the same structure to yourself, therefore creating a virtuous circle.
Let me be clear: master-servant mentality will not drive the best out of your relationship in any way, and particularly not in creating trust and transparency. That doesn’t mean that you aren’t able to lead; it means that you should lead as you’d like to be led.
If you’re adhering to the 4 C’s, it will make it easier and more logical for your agency to do so, which will make it easier for you both to move forward. Sharing the same value system will generate a tighter relationship.
To consider how this works in practice, we’ll now explore a number of behaviours, approaches and actions you can take to become 4-C Compliant.
Consultative
Starting with Consultative: Be completely clear about the agency scope and remit, set up a roster structure, and agree set times for the agency to talk to you about new services.
Agencies are full of intelligent and competitive animals. The whole industry is soaked in competition – the pitching process and the multitude of awards ceremonies being two demonstrable examples of the culture.
Adding fuel to this fire, the areas between different types of agency on your roster continue to blur. Media agencies, like any other type of agency, are under pressure to not only grow organic revenue streams, but also to future-proof themselves, guard against pitch-threat and exploit new business via the use of diversified case studies. Some media agency groups have service wheel structures, against which account leads are actively targeted in terms of revenue.
All of these dynamics mean potential headaches that you don’t need – intra-agency squabbling, continuous hard-sell, muddy strategies, not to mention a feeling that every recommendation may have an ulterior motive that has nothing to do with doing the best thing for your business.
To overcome, you need to lead. The agency needs to be completely clear, from day one, about what is and is not in its remit; and, more importantly, the types of behaviour regarded as acceptable, and those that are not. A good way is to set up a roster structure that enables such leadership to take place across the agency group – examples include a holding company structure (all agencies part of the same holding company, with one central lead co-ordinating all efforts) or a Strategic Group structure (form a small ELT, with representatives from each agency, which meets regularly with you to direct strategy and resolve challenges).
It can also be useful to recognise the fact that media agencies need to grow their business – but on your terms. Give your agency the opportunity by setting time to talk to you about new services. This way, you can prepare for such a session, and guard against the agency feeling that you are simply shutting it out.
Open the black box
Task your agency with opening the black boxes of media. Admit what you don’t understand. Be willing to prioritize regular education. And show a genuine interest.
If you want your agency to open up to you, you need to open up a bit to it. It’s critical in any consultative relationship that the knowledge gaps of both parties are established and dealt with. In the case of the media agency, there is, in my experience, fundamental lack of understanding on the client side across some key areas – programmatic trading being one notable example.
Agencies have certainly been guilty of putting black boxes of mystery around things like programmatic trading. This is now changing as the landscape evolves, the issues of transparency become more public and the competition grows. Structurally, some agencies are starting to renounce the service wheel approach (which often creates black-box mentality via distance) and operate more seamlessly.
However – regardless of this, most (at least all good agencies) would happily take the time to explain more, if only the client would ask for it. Sometimes, yes, the agency should be more pro-active; but sometimes, the client just needs to be honest about a knowledge gap and work with the agency to correct it. And when you do have the education session, work-shadowing session or whatever is agreed on – please show genuine interest and application!
There have been many times in my career when the agency team has worked hard to prepare something like this, only for the client team to turn up late or not at all, sit on their mobiles, appear disinterested or above it all. My experiences are backed by those I talk to on the agency side. And don’t forget that agencies are often not paid for the work they do in this space.
If you need to be educated – let the agency educate you and exchange your views in return. Make the process consultative. And insist on the right behaviours from your own team.
Feed the dynamic of co-creation
I can’t tell you how motivating and empowering it is for a media agency team to feel that they are genuinely working with you to co-create something that will deliver better results.
I can’t tell you how many times people on both sides of the relationship talk about co-creation, but are in fact moving at completely different paces, often for the wrong reasons.
The most common challenge is understanding where you actually are on a journey, and what is realistically achievable. This can be reflected in what you’re briefing and how you’re setting goals. Just like anything, if the goals are unachievable, you’re setting yourself and your agency up for failure.
Work with your senior agency team to define your journey, and segment it so that everyone can see where they’re headed.
Enable evolution
This is another area where so many clients and agencies talk the talk, but simply don’t walk the walk.
Agencies often feel the pressure to ‘do something completely different’ – sometimes, that pressure is self-inflicted, sometimes it comes from clients who aren’t sure of exactly what it is they want, or who brief inaccurately. Often, there’s a lot of talk, but when it comes to the crunch, no action is taken, and no real change occurs, because the marketer backs away from what he or she sees as an unacceptable level of risk – or, the agency has not provided the right ammunition for the idea to be sold internally.
If you’re unable to take risks with your media strategy (abandoning television, ramping up content, whatever it may be) then be clear about it with your agency, and why. Find the right balance in briefing between asking for what’s required without being directive, whilst leaving enough room for evolution – but don’t write a brief that says ‘you must flip everything on its head’ if you know that there’s no real possibility of such an approach actually happening.
Try to build in an element of evolution into your journey with the agency, and brief clearly on the parameters of what constitutes acceptable risk. This way, you’ll get better solutions from your agency; your agency will not waste time and effort trying to build something that can’t be built; and you’ll both be far less frustrated.
Compliant
Lets talk about some key Compliant behaviours.
Understand your contract, and make it future proofed where possible.
Media agency contracts, like the industry, are becoming more complex to manage. There are simply more elements to consider.
Often, in my experience, media agency contracts are out of date (sometimes years out of date), not applied and not adequate. Which, of course, leads to misunderstanding, accusations and lack of clarity when the contract is finally pulled out of the drawer.
Your contract, amongst many other things, should provide you with clear understanding of agency revenue streams, including rate-cards for diversified elements (even elements that you don’t currently use but may use in the future; it should contain a clear and up to date remit of services provided; it should outline FTE structure and named individuals where necessary; it should provide a right to audit; it should allow for regular cost review in certain areas.
You should be in a position to understand as much as you can about how transparent your agency is prepared to be, and push hard for that transparency to be not just in the contract, but to be actively reviewed as part of due diligence.
Pay fairly and pay on time
Pay fairly, and pay on time.
Basic business etiquette, but there are a number of companies who do not pay fairly. I certainly don’t suggest that marketers should pay over the odds, but at the same time there is a balance between getting the best cost, and paying to a level commensurate with what a business can bear. Of course, the commoditization of the industry is at least partly the fault of the agencies, and an agency who signs a sub-standard remuneration, or tries to ‘buy the business’, has itself to blame. Having said this: extracting best value from your agency does not equate to lowest cost, nor does it lead to trust and transparency.
Put simply, I think that where bad practice in both areas exists, it exists for three reasons. First, it’s an expression of the master-servant dynamic and a recognition of the fact that, in a commoditised industry, the agency needs the client more than the client needs the agency. Second, there’s a hazy perception that a service-based proposition doesn’t have as much cash flow pressure as other forms of business (which is of course patently untrue). Third, there’s the pervasive view that agencies are all fat-cats creaming profit.
Think carefully about what you actually want from your media agency relationship. At TrinityP3, we comprehensively benchmark agency remuneration models all the time and we will not hesitate to call out those agencies we view as too cheap.
And when you do pay, please establish sensible credit terms (I’ve seen 120 day payment terms before now, which frankly is not acceptable to any business) and pay on time!
Performance incentive clauses can work really well to generate optimal performance, if they’re set up right – and if they’re actually adhered to. To be fair, most clients will adhere to a PRIP and reward great performance appropriately, but I have seen instances where the client will invent reasons not to pay something that’s been hard-fought for.
At the end of the day, your media agency is in business as you are. If you don’t respect it, it will find difficulty respecting you. If you don’t pay it properly, it won’t invest in you.
Corporate governance
Ensure that your agency understands any relevant corporate governance guidelines or affiliations with industry bodies (e.g. marketing to children).
This isn’t something that comes up very often, but when it does, it can be very painful. Many years ago, I worked with a large FMCG Grocery company. We were marketing a product that could be consumed by both adults and children, and pester power, in agreement with the client, was inherent in the strategy. After checking that the advert had a G rating, we allowed a small proportion of bonus TV airtime into children’s programming – unwittingly contravening the company‘s global marketing to children policy. When a random consumer picked up the phone and complained, all hell broke loose.
Of course, in this case, there is fault on both sides, from both a client and an agency, in terms of fully understanding protocol. But it was a valuable lesson to me about the importance of the media agency being given full knowledge, up front, about any relevant compliance issue, so that situations like the one I’ve just outlined can never occur.
Commercial
Considering now some commercial behaviours. First, Articulate your business strategy. Help your agency to help you in driving the bigger agenda. Measure against the bigger agenda, not just the media nuts and bolts.
The more involved your media agency is in understanding your broader commercial strategy and challenges, the better placed it is to help you drive your marketing effort forwards. It isn’t just about ‘more sales’ (although more sales is obviously the end result in all cases) – it can be about how other functions in the business are working with your team, new partnerships, product development or data sources, new marketing initiatives outside of media strategy that may or should have a bearing on how paid media might work.
It’s also not about drowning the agency in useless information; it’s about balancing the critical nuts and bolts with the broader commercial imperatives so that the end-result from your media agency is enriched by context.
Act as one
When it comes to dealing with media sales networks – act as one.
This could just as easily have gone under ‘Collaborative’. Some clients like to be involved in commercial discussions between their agency and the sales networks from whom they strike commercial inventory deals. I’ve never had a problem with this, and any agency secure in their relationship and understanding of where value is added should never have a problem either.
Where it becomes difficult is where the client goes to the networks without the agency. This does nothing except undermine the longer term negotiating position of the agency, generate resentment and uncertainty, and make the agency feel redundant. All of which is not good for you.
When dealing commercially with external networks, you and the agency should be acting as one. I’ve even been told of situation where the client has criticised or put down the agency in front of a network – which is completely inappropriate and unacceptable. The old cliché of the agency as an extension of your team applies here in reverse. When you’re working with media sales networks, you should work as an extension of your media agency team – and together, get to the best result.
Collaborative
Now lets look at collaborative behaviours.
Confront your challenges head on – with empathy. Share your expectations. Set clear boundaries. Find the common ground. Then make the rules.
I have worked with many agencies, and many clients, who have allowed difficult relationships to fester because they tiptoe around what the real challenges are.
So a constructive confrontation of those challenges has to be the first step, as well as a commitment to a longer-term behavioural style.
You and your agency need to understand the good, the bad and the ugly before you can truly start moving forwards. No subject should be off the table; the discussion group should be as small as it possibly can be; and there should be some careful set up from you to the agency as to your intentions.
It’s critical that you act with a degree of empathy, both here and in general, to the pressures the agency may be under. The agency, in return, should be expected to do the same.
Be an active participant
Be an active participant in driving your agency team structure and personnel. Don’t put up with square pegs and round holes.
The best single relationship I ever enjoyed with a client started with that client interviewing me for the job of running the account.
Who the agency hires to do a job is ultimately the agency’s decision. But you can be involved; you know yourself best. Often agencies don’t think to ask for client involvement in the recruitment process, believing that it will cause irritation. But any good media agency should welcome your involvement as a stakeholder, should you ask for it.
And if personnel changes need to be made – be pro-active and talk to the agency about it. The first rule of a good performance review is that nothing should be a surprise; it is completely counter-intuitive to bottle up the stress caused by an under-performing or badly-fitting member of your agency team. A good agency will appreciate your honesty and take immediate steps to resolve any square pegs in round hole situations.
Loosen your tie
Loosen your tie. Admit (to your agency) when things are hard. Make it clear your agency that you want them to do the same.
Whilst I would always caution against becoming too ‘single point sensitive’ on any one individual, all relationships ultimately thrive on intimacy. Your media agency relationship, which often carries a day in, day out level of contact, is no exception. Within appropriate boundaries, a degree of professional intimacy with your senior agency stakeholder can work on both sides to boost confidence, relieve tension, increase understanding and ultimately generate better loyalty, honesty, drive and motivation, all of which leads to better results.
Performance a two way street
Accept and commit to the fact that high performance is a two way street. For sure, take your media agency to task where it is clearly at fault (and the good agency lead, if you have a strong relationship, will stand up and be counted in these cases anyway); but don’t hammer it for something that is out of its control. Simple examples include blaming a missed sales target on the media buy, without proper consideration of the many other factors that may have contributed.
If the agency sees that, where appropriate, you have its back, then it will have yours. Succeed together, fail together, and always work with your agency to evaluate performance, good or bad.
Summary
In summary, there’s no doubt that the perception of ‘industry crisis’ is true to a certain extent. Media agencies still are, in some quarters, regarded as the estate agents of the industry.
But in reality, away from the headlines, the relationships between media agencies and their clients (and vice-versa) have never been more complex. Both parties face huge challenges in a constantly shifting landscape, internally and externally. Frustrations, misunderstanding and lack of transparency are fundamental challenges affecting performance.
The 4 C’s – Consultative, Compliant, Commercial, Collaborative – can shape the way in which your agency behaves. Working in this way, you will be able to extract optimal performance from the relationship with your media agency. To make the 4 C’s happen in reality, you need to invest in them, commit to them, lead from them, and apply them to your own part of the relationship.
Check out the TrinityP3 Webinar Series here.
If you would like to know more about TrinityP3’s Media Transparency, Performance and Value Assessment click here
