This summer, Morgan Stanley analysts announced that nearly $30 billion of advertising spending is currently up for review. As the Wall Street Journal put it, "that’s more money hanging in the balance than the amount under review during the last three years combined."
If those numbers tell you anything, it's that brands across the U.S aren't happy with their agencies. Who could blame them? The fact is, very few agencies are capable of evolving fast enough to keep up with the industry. They've done little to cut costs and are unclear about how they arrive at their fees. What's surprising isn't that $30 billion is in review, but that it didn't happen sooner.
In the midst of all this change, there's been an influx of small agencies—boutique shops ready to grab at the work that larger agencies stand to lose. And from the brand perspective, those new, smaller agencies seem like they may be on to something. Often, they are less expensive and more agile, but with so many choices, it can be difficult to determine if an agency is the right fit, let alone if it will deliver on its promises.
So what should businesses consider before hiring an agency? How do you discern the good from the great?
First, do your research.
You would think this goes without saying, but some brands are so stressed for help that they dive right into a long-term contract without doing any research. Talk to other business owners you respect and ask about their experience with a current or former agency. Sometimes, they’ll steer you toward a diamond in the rough. Other times, they’ll steer you away from a company that oversells and under-delivers. Both are valuable insights.
In addition to word of mouth, keep an eye on industry trade publications like AdAge and AdWeek, which offer daily articles featuring the work of agencies around the nation. By reading, you can learn who is working with whom, which agencies have won awards and get an initial feel for how an agency is perceived among its industry peers.
But just because you haven’t seen an agency name in print, doesn’t mean it’s not worth your investment. If you’re intrigued by a small shop, dig into the background of the people in charge. What did they do before starting the agency? What experience would they bring to the table? Small agencies with big experience are hard to find. But they do exist.
Dig into the case studies.
An agency might wow you with a beautiful presentation and a lot of lofty promises, but if they can't prove their work leads to results, you should consider that a major red flag.
As you narrow your list of possible agencies, request case studies and client references. Keep in mind: humans are creatures of habit. If the people at an agency have a habit of creating success, then they will create success for you, too. Alternatively, if someone has been sitting in an agency for 10 years but has never grown businesses or won awards—chances are they are not going to suddenly do it for you either.
Case studies give brands a chance to check an agency’s claims against their actual report card. While evaluating a case study, look for the problem(s) the agency solved and the results their work generated. It’s easy to manipulate statistics, so just like in a school chemistry problem, make sure that the “units” match. If the client was looking for an increase in sales, the results should be in dollars, not in “clicks” or “likes.” Likewise, if a brand is looking for a social following, the results shouldn’t be in number of videos produced, or even in the virality of a campaign—it should be followers.
Once you have a short list of contenders, prepare a brief describing what your brand needs and the problems you’re trying to solve. When the agency arrives to pitch their ideas—your job is to evaluate their thinking, not just their creativity. Ask questions. Find out if they are prepared. After all, it’s easy to be won over by a creative idea or flashy video. What’s hard is to find a smart agency that can work within your parameters to solve your particular problem. Can they work within a limited budget? Can they meet deadlines? Ask them about a time they under-delivered. See what happens.
Make sure they measure.
Nothing drives me crazier than an agency that doesn't know how to measure the results of its work. So before making any final decisions, make sure you know how each agency plans to measure its success or failure. Marketing is a mixture of art and science. It’s important for an agency to establish the key performance metrics it will track for your brand up front, that way the agency will be clear that insights and analytics are a part of the process from beginning to end.
Look for the spark.
In the end, hiring an agency is an investment in people. Look at who is sitting across the table from you. As a brand, does the agency's sensibilities match your own? Better yet, do they match that of your target audience? Beyond the case studies and research, ask yourself whether or not you actually like the people that would be touching your business. Just like in any relationship, there needs to be a level of chemistry that keeps you excited and motivated to keep moving forward.
Ask yourself if you're impressed by how they think, not what they think. How did they come to the solution for your particular problem? Did they provide you with insights, or just a flashy end product? You can always make adjustments on creative, but you can’t change the way a person thinks.
Ultimately, your brand has a particular story to tell and no matter how new or flashy an agency might be, their role is always to support your story, not write a new one. In other words, don’t hire the agency that inspires you, hire the agency that was inspired by you.
