ISBA last partnered with the Advertising Research Consortium to quiz marketers about their advertising agencies 15 years ago. It was a time when the Government thought building a £700 million tent in South London would be a fine way to ring in the millennium; when the manager of the England football team, Glenn Hoddle, thought disabilities were punishments for the sins committed in a former life; and when Abbott Mead Vickers BBDO released "surfer" for Guinness.
So it is probably time that ISBA and ARC got in touch with brands again to ask what they thought their agencies did well, and not so well.
"In the past 18 months, we noticed a marked increase in the number of conversations with our members on the challenges and impacts of the multichannel environment on their creative agency relationships – so much so that we shelved another project we were planning in favour of running this survey to quantify members’ views on these important relationships," Debbie Morrison, the director of consultancy and best practice at ISBA, said.
"The world is moving so fast that I don’t think we can leave it another 15 years until we ask again, but we will track the mood of advertisers through ISBA Consultancy and see what happens in the next 18 months. We would like to ask creative agencies what they think too, and ARC has developed a study aimed at the agency community."
ARC e-mailed 954 marketing and procurement contacts (provided by ISBA) between February and April of this year. The results outlined here come from the 93 completed surveys that were received.
How do the 2014 results compare with previous surveys?
• There has been little significant change since the previous survey in 1999 on agency delivery of the five KPIs (see table, opposite page). It is possible that about half of clients will always be less than happy with agency service delivery. But this is not to say that clients feel exactly the same about their agencies as they did in 1999.
• Fewer clients today find agency management proactive or efficient at administration.
• In terms of the comparable factors available for the contribution of agencies to strategy, clients are less likely to be satisfied now. This is most evident in terms of the profundity of thinking that the agency brings to its recommendations.
• There were few comparable factors in terms of creativity, but it appears that clients now rate agencies’ creative work (as fresh, distinctive or original) more highly, though fewer are as positive when it comes to strategy.
• One area of agency performance where client perception has worsened is agency finance. Fewer clients are satisfied with agency cost control and transparency.
Morrison: "Fifteen years ago, clients were more reliant on their main creative agency for most communications. Now they are not so dependent, having added specialist agency capabilities. A dangerous emerging precedent appears to be the perception among clients that their creative agencies have lost the high ground in ideas generation, profundity of thinking and proactivity. Allowing the ‘ideas function’ of an agency to diminish in the eyes of its clients is a slippery road."
What do clients with long-term relationships say about their agency partnerships?
• Clients perceive their agency managers as proactive and acting with initiative, and believe the account team is more likely to be efficient at administration.
• Agency employees score well on trust. As the relationship endures, so trust increases. Clients are more
likely to believe that their agency does not further its own agenda or engage in turf wars. And the longer the relationship, the more likely clients believe that production is on time and on budget.
So how do these compare with newer client/agency relationships?
• The survey shows that a young relationship is good for innovation and delivers on-strategy creative and marketplace results.
• Clients with younger agency relationships are more likely to be satisfied on delivery of digital content.
• Agencies that had only recently begun working with clients are thought to be more likely to have competent generalists who can recommend a channel or media with neutrality. However, such agencies are not seen as being as cost-conscious as those that have worked on an account for a long time.
Morrison: "While creative agencies are reported as being trusted by their clients, the study also identifies issues with perceptions of value for money, transparency and efficiency. These perceptions have been consistent for the past 15 years. Issues with ‘value’ are reported in every study ISBA/ARC has conducted related to client/agency relationships. Perhaps clients choosing a range of specialist agencies is impacting on the role they see their main creative agency playing."
What difference does the size of the agency make to clients?
• Clients retaining small agencies emerge as the winners. Small agencies stand out on service and also achieved the best results on value for money, agency management, resources and trust. That said, they were the weakest in terms of contributing to a brand’s standing in the market. Small agencies don’t rate highly when it comes to the big-picture work.
• Medium-sized agencies top the survey when it comes to creativity as well as knowledge and analysis.
• Second-tier agencies (with billings between £100 million and £200 million) typically achieve the highest scores on delivery of marketplace results and contribution to brand standing. Value for money is not good but these agencies rate well on all finance factors.
• There are benefits of retaining the biggest agencies – they lead on strategic thinking and contribution to brand standing. However, clients tend to rank big agencies as weaker at understanding consumers and creating digital content on time.
Morrison: "Creative agencies are criticised in the study for not collaborating with other agencies retained by the client, for a lack of neutrality of ideas and for being behind the curve in digital and tech developments (many believe their structure is too TV-centric), and especially in relation to agility of digital delivery. These are common themes to the conversations we have with advertisers, with many pointing the finger at the larger/medium-sized agencies as the main culprits. Our members generally say smaller or newer creative agencies tend to be more channel-neutral than bigger agencies."
What difference does the size of the client’s budget make?
• Clients with budgets in excess of £50 million are more satisfied with their agencies. The clear answer is that biggest clients win. On just about all the summary dimensions, they lead: they are well ahead in terms of marketplace results and brand standing, significantly ahead in terms of management, knowledge and analysis, and service. They also enjoy the most trusting relationships with their agencies. The best explanation is that accounts with budgets in excess of £50 million want a partnership relationship with their agency.
• It’s not all positive. Big clients’ agencies were more likely to be described as having silos, slower at delivering digital work and more likely to favour TV campaigns.
• Medium-sized advertisers (with budgets between £10 million and £50 million) fare the worst, coming in last in just about every dimension.
• The smallest clients (budgets of less than £10 million) don’t come out on top on many scores, but they typically outperform agencies retained by medium-sized clients. On many individual factors, agencies retained by the smallest clients come a close second.
Morrison: "Clients with medium-size spend perceive that they are losing out across the board. The happiest clients are the ones with the biggest budgets, unsurprisingly."