Ten Reasons Why the Agency Model is Broken


TopTen Agencies need to change how they work with clients, or they will keep changing agencies like underwear.

The biggest question: Is the agency model broken?

I think it is. I think it's time to re-imagine our collective approach to creative work, and it begins with the agency-client relationship itself.

I'd start by tackling those behaviors that get in the way of the real results and prioritizing the communication mix to encourage conversation with the people who matter the most: The ultimate customers.

Ten reasons why the agency model is broken

(1.) Thinking that "not invented here" is a problem

Creative is not the end-all be-all, it's a starting point. The real conversation happens afterwards, in the marketplace. Many companies are facing this same challenge of being led to the creative of a specific agency as Holy Grail.

I see a new way of working possible: Using what already exists as part of a company's DNA and building on it. Why reinvent the wheel every time?

(2.) Focusing too much on the agency's process and not enough on the client's business

This may be true especially in a B2B model. I am reminded that businesses are made of people, too. A deep knowledge of the industry's sales cycle, buyers' behaviors, and products/services goes a long way to create a communication piece that works.

An ad is (or should be) a communication piece.

(3.) Being inconsistent

Talent is a real problem, especially now that everyone scrambles to become "experts du jour" in social media or to onboard the popular ones.

Yet there should not be such disparity between the promises made by the strategy team and the output delivered by the creative group. (this is also valid when the agency is a consultancy, and a thick PowerPoint is the deliverable) 

(4.) Lacking in originality

Leaf through a magazine or browse a series of websites and what do you see? A sea of sameness.

Are these all clients who could not "go for it"? I suspect not. Every single time I dared propose something that was not "how we do things here" I was pleasantly surprised that the company would go for it.

Dare to be different, and not just for the sake of being different.

(5.) Signing up for one thing and wanting it all before delivering on that one

This is common to too many providers.

Anyone enjoy sitting in hour-long capabilities presentations? How about delivering on the project you've been given first? Your work cross-sells more work for you. Stop talking, start doing. It never fails.

People hire excellence. Experiencing "excellent" is the best referral of all.

(6.) Listening but not hearing

Sometimes you may be tempted to push through early signs that you are off base.

Stop saying you are listening and start hearing what the client is telling you. How can you tell? You are two months late on a project and the client is not talking with you anymore. They have given up.

(7.) Making it hard to get work done

This is a corollary to the previous point. If you've been in business long enough, you should know how to elicit (and take) feedback while you keep moving on the project.

The worst thing you can do is to huddle away for weeks without open communication lines with your client. A powerful component of setting expectations is to collaborate by making your contact from the client part of the team.

(8.) Thinking only in terms of billable hours

In that case that's all the client ever sees.

Wherever you focus your energy and attention, that's what gets brought to the fore. Soon enough the client will stop picking up the phone and calling you for projects.

The whole compensation model needs to be revisited. The agency that cracks this code wins.

(9.) Not working on the relationship

Getting to know a client's business can be very valuable to your output in the end.

That is if you think in terms of relationship on not just billable hours. Do you want to know how we can tell the difference? How quickly do you email estimates and invoices and how often do you follow up on those vs. the project?

(10.) Moving on before the work is done

Typos, slapping copy on without working from a strategy brief, and a bevy of small mistakes are all indications that you've moved on, that you are not interested anymore.

***

It can be very rewarding to work with people who are passionate about what they do and make it easy for you to work with them.

I propose that the best kind of agency is the one that can be customized to the client's needs. For example, a virtual agency as a flexible solution that fits a client's business cycle. Little overhead, the ability to choose your lead copy writer and lead creative. No agency fees and none of that multiple agency problem where each tries to get more work in other areas.

This model requires confidence on the client's part that she can be the general manager. It has the potential to fit like a glove in the fragmented media environment we have moved into.

What do you think? Does virtual agency model work?

 

[revisited and surprisingly still applicable]

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0 responses to “Ten Reasons Why the Agency Model is Broken”

  1. Having worked in major market/international advertising agencies, I set up my marketing-communications consultancy (in 1982) *intentionally* as an alternative, based on my first-hand observations.
    I think these 10 points are areas to review in any client-service provider relationship, especially ‘billable hours.’ When the ‘commodity’ of creativity is added into the mix, an element of complexity is introduced to the relationship.

  2. My partners and I are now in our third year of a virtual agency model, with a nucleus of execs (cough-cough) providing the focal point for an alliance of contractors/freelancers we activate as needed. It can mean crazy, schizophrenic hours for us, not only delivering but also maintaining that essential biz-dev focus, but it’s a blast. No office space worries, no staffing gymnastics. Sure, it presents its own challenges when we need to find good but unproven people when we’re fully deployed, but that’s the juice, isn’t it?
    At first, we held off explaining the model to our clients, playing it very close to the vest that we were “virtual”; we feared it was a perceived drawback. Now, we make it clear right from the start (and explain why it allows us to be ultra-competitive on pricing, more agile on delivery, etc.). It keeps us very client and solution focused.
    Yeah, we don’t have a foosball table — but how many clients do you know that would be happy to know they are being billed for foosball?

  3. I speak from two sides of the experience as well. Indeed, creativity is not a commodity and should not be seen as such. Easier to buy it as valuable when it goes beyond the tactic to the experience design root. My wish would be for more agencies to get that knowing the business and understanding it are where the market opportunities open up for all involved. Operational experience doesn’t seem to be a skill valued by many shops, in favor of having been in agency structures, thus knowing how their “process” hierarchies, etc. work…

  4. there have been so many changes on the marketing side of things both inside and outside organizations in the last 5 years, that I’d say it’s about time we talk about models that work better. Yes, the challenge is that good, no scratch that, exceptional people, do get busy by virtue of being that good. Lots of repeat business and limited bandwidth. Which is where it used to make sense to have a team – to teach others, elevate skills for all, in order to scale. Now that I’m on my own, working within established relationships, I find that talent and experience are rare to identify and should be valued and appreciated when you do. More agent, a little less conversation.
    PS: I was one of those clients who could not have given a damn about a Foosball table, even as I enjoyed playing as a kid.

  5. I’m a partner in a virtual agency. The model works. It’s tough though (your processes need to be more finely tuned for traffic management than they are at a traditional agency).
    Our client’s appreciate us being honest that we aren’t experts in everything and we grab the best designer / illustrator / writer / etcr based on that client’s needs and brand with either myself or our two partners managing the outcome.
    That said, this model doesn’t necessarily solve all of these problems. The sea of sameness in ads are sometimes “death by a 1000 paper cuts” problems. No ad is awesome on version 41. That’s one of the reason why we choose to work with entrepreneurs instead of large clients, they are better decision makers and don’t care as much as about their opinions as they do outcomes.
    Great article.

  6. Hi Valeria – Great list. While I work in a relatively small-ish agency now (40 ppl or so), I spent most of my career on the client side hiring agencies. I agree that most of what you listed can be serious problems in the client-agency relationship, however I don’t feel that even in aggregate they are a sign that the agency model as a whole is broken.
    Rather, they nicely highlight how *certain agencies* are broken. Pretty much everything on that list can be corrected within the current client-agency model by the good agencies out there. Most agencies are guilty of one or more at some point in their lives, but the good ones recognize the problem, address it, and grow.
    I think where the model is truly broken is in the increasingly artificial distinction among agency types: digital vs ad, PR vs marketing, and so on. Aside from some specialties, most of those legacy distinctions are a hindrance at best and the clients increasingly don’t care. Look at social – I just saw that MRM WW (direct marketing shop) is building GM’s Facebook pages. Every agency is diving in, and the artificial slotting of agencies into this mold or that is where things are truly flat broke.

  7. Hi Valeria,
    It’s been a while 🙂
    I’ve recently joined an agency and also hear others in this space talk about their work so I would say that you’ve made some excellent points.
    Here goes:
    1) Some agencies wants to be all things to all people focusing on the next opportunities for billable hours #8 and think that innovation = shinny new object (aka social).
    2) This is especially true for traditional agencies with traditional clients that thinks process is the only way to scale and replicate ‘wins’ for all accounts. I see this in B2C as well, focusing too much on process and project management instead of becoming a strategic partner (in business) and commitment-to-success relationship #9.
    3)This happens often to younger agencies or agencies with inexperienced individuals who happen to figure out the platform and the technology following the process #2 while upper-management wants to position deliverable as something else.
    4)I see this issue more about the fundamentals of the agency’s culture. It has to do with innovation and risk-tolerance to be original (loosing the account or blowing up the campaign).
    5-10 are again, all part of the ‘traditional’ agency model and like what Kevin said above, most agencies are guilty of them but it’s also part of the transitioning pain.
    The agency landscape is changing because client side demands are changing. So shouldn’t the agency/client relationship evolve as well?
    Definitely.
    The issue is with trust and relationship. I like the virtual agency model but it’s probably only going to work for certain types of clients.
    At the end of the day, some clients are willing to pay for performance, while others are paying for that feel-good-branding since nobody ever got fired for buying IBM right?
    Just my 2 cents…

  8. Agreed. As the majority of my career has been based on creativity, I don’t view it as a commodity, either. I have always believed client-focus vs agency infrastructure is key to effective service delivery.

  9. Hi Valeria.
    Ahh… the agency model. Still broken after all these years.
    I’ve been a part of many attempts to offer up an alternative, some successful, some not, and my learning is that while better models may be out there, the most important factor isn’t structure, it’s human.
    The solution to just about every problem you outline is getting the right talent on your business.
    If I were the client, that would mean: smart, driven, curious, lateral-thinking people who care first and foremost about my business. And if I was a marketer of a certain size, I would be motivated to locate those wonderful people inside of an agency with broader capabilities.
    I’m curious about your own experience… what models work best for what situations… which models improve the output of individuals and which ones hold us back?

  10. I worked in those companies as well, where there needed to be several layers of approvals. The caliber of the final product depends on that chain to be formed by the right people. I worked with more than one legal counsel who understood the value of creativity, for example, and limited their remarks only to providing counsel to the business on risk.
    Revisions are only fun when they come from a place of experience and understanding – and not use of fear and insecurity. Agreed.

  11. Recognizing the problem, addressing it, and growing are refreshing action steps. I have also seen denial, and, in one unforgettable instance, throwing the client under the bus, which I would not recommend under any circumstance – we live in a very small world…
    Although I have seen some overlap of agency models, especially more recently in association with eagerness to expand the business into social, I have also seen some disparity in skill sets to support those areas of growth. To me, it makes total sense that a direct marketing shop would handle lead generation. Except for, I would not rely too heavily on Facebook. I might be among the few on this one, I still think a company should use its own web properties as a hub.

  12. one other detail I have not mentioned in the post is that I had the fortune of reviewing the work of other agencies in circumstances where my support was needed to take things to completion.
    Indeed, the saying that nobody ever got fired for buying IBM is still applicable. Except when the business truly needs to become stronger, more resilient, and build endurance. Which is when it is ready to admit that the safe choice is not going to cut it.
    Good of you to visit. And congratulations on your new position.

  13. Funny how at the end of the day, it all comes down to people isn’t it? I do wonder why, if talent is so important, which it should be, so many agencies (and companies), hire poorly and allocate resources randomly. I have experienced the difference between being on a piece of business that made sense from a fit standpoint, and seeing what a mis-alignment can wreak on an engagement.
    I have found a mix of resources to work best at keeping everyone honest and working from their strengths. For example, I worked with a fairly big ad agency and a senior/experienced account team, bringing in a design firm to provide additional support (and speed) for the direct component, and a printer capable of working efficiently with both. The quality that works best with me is “hands on” capabilities, execution experience at the end of thinking strategically.
    Many an agency laments the lack of access to the client’s business – and I have experienced that when on the agency side. Because I believe in true partnership, I integrate the account team as part of my operational team. With one caveat: I don’t want to see any lazy work, no “save as” decks from other clients repurposed, no generic or warmed up solutions proposed. I love energy, avoid hiring egos and prima donnas. Collaboration = win

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