The effectiveness awards season is upon us. It’s that time of year when we beg, borrow and steal (only if you’re really committed) any data that can prove how much value we have added to a client’s business. We upload our submissions, share the really good ones with our clients and then we hope that we’ll pick up some metal.
But here’s a question: how many of us share our effectiveness entries with our CFOs? An odd suggestion you might think. Well, actually it’s not. For all the discussions around the future of our industry, the first thing we should be instigating is an effectiveness audit on ourselves. Can we answer this question: are we getting paid in line with the value we create for our clients?
Why is this an important, I hear you ask? The IPA report “The Price of Success” suggests that increased competition and changes in the structural dynamics of the industry means that agencies are doing more for less and are still not winning. That’s because client-agency remuneration structures are based on agencies getting paid for their time, not the value created.
And this restricts our ability to grow. The kind of growth we need to diversify and invest in our capabilities to create great work and to recruit and retain the best of the best. Which in turn allows us to compete against consultants, tech platforms and anyone else who is throwing their hat in our creative ring. But the only way we can we charge for our value is if we can prove it. Unequivocally and consistently for each business we work on.
Sounds pretty straightforward, right? It would be, if it weren’t for our inherent and collective discomfort with commercialism. No other industry is so coy about doing well, being financially successful or looking after its own interests as the creative industry is. Is it a British modesty thing? Maybe. But above all I’d submit it’s an ignorance thing. We simply don’t know (or care) enough about how our clients make their money, what they want to achieve and our contribution in helping them get there. As highlighted by Steve Harrison and Paul Feldwick in Campaign this month, growth is too often discovered as a by-product-cum-happy coincidence instead of a deliberate result.
So while it might sound unusual for a strategist to be talking about improving the remuneration models and growth trajectory of an agency, you can see why it’s so important we not only lead in this conversation but use our skills to change it.
Here’s a few ways to get the ball rolling:
Know the value you are being asked to create by your clients. Often we don’t. Often they don’t. Awareness, consideration, preference are all great metrics, but how do they translate to the bottom line? What numbers and per centage points are we talking about?
Define how valuable our work is to a business, and link this to how you charge for it. “I’ll encourage my clients to pay more for the things that will make a big difference”, says Lucinda Peniston-Baines of The Observatory International
Connect these two and talk to your CFO about how you are aligning your creative strategy and KPIs to your remuneration model and ensure that they reflect the change you create
This approach might sound uncomfortably self-serving. And it is. But that’s a good thing. It will ultimately make the work stronger, engender greater trust with our clients and create a sustainable future.
Anna Vogt is chief strategy officer at TBWA\London