Industry bodies create guide to evaluating work

The new set of guidelines will address the thorny issue of agency remuneration.

The IPA, along with three other industry bodies, ISBA, the MCCA and the PRCA, has created a best-practice guide to evaluating the work of marketing and communications agencies.

The guide has been developed to provide a standard set of tools to help marketing directors measure the value of the work their agencies produce and justify budget increases. It aims to address the thorny issue of agency remuneration as clients demand greater financial transparency from their agencies.

The guidelines were compiled using data from the first cross-industry research into how clients and agencies evaluate their marketing and communications.

This showed that although 95 per cent of clients evaluate marketing, fewer than 20 per cent measure the effect it has on profits. It also highlighted that 90 per cent of clients felt that evaluation data should be used in remunerating agencies. And 90 per cent of clients and their agencies said they wanted an evaluation guide.

The guide outlines three ways of evaluating work to emphasise the impact marketing and communications can have on a company. Time series analysis compares the performance of a company before and after work has run; regional analysis tracks the performance of a product in areas where work has and has not appeared; and competitive analysis compares the performance of a company that has promoted itself against a rival that has not.

Sven Olsen, the chairman of the IPA value of advertising committee, said: "This is what everyone wants in our industry. Evaluation touches everything, from proving the case for communication investment, justifying marketing spend and deciding how agencies are paid and how their ideas can be valued. It seems perfect timing for this guide."

The guide will be distributed to all ISBA members.

It is the third publication the four trade bodies have developed to help enhance the relationship between agencies and advertisers.