How to hire--and when to fire--your agency

Ten keys to avoiding mistakes when starting or ending a client-agency relationship.

According to conventional industry wisdom, the average client-agency relationship now lasts about three years. Some seem to self-destruct as quickly as a Pamela Anderson marriage. The Wal-Mart – Draft coupling unraveled before the agency produced its first campaign for the fickle retailer.

Why did Wal-Mart dump GSD&M, the agency that helped increase their sales more than 2,800%? Why did they chose Draft as their new marketing communications partner? And why didn't the new relationship work?

Key #1: If it ain't broke, don't mess with it.

GSD&M's work delivered spectacular results for Wal-Mart. As it had for years. And that was the problem. They were the predictable, dependable long-term partner. Not the exciting new vixen or stud muffin. Best we can tell, Wal-Mart was bored. So they hired a new marketing maven who hired a new agency. Like many ill-considered flings, things ended badly. And by the time Wal-Mart realized they'd made a middle-age crazy mistake, their old reliable agency wasn't interested in trying to rekindle the relationship.

If your agency is producing results, don't tinker with success.

Key #2: Recognize that there's a limit to what marketing communications can achieve.

Wal-Mart flat-out owns the price/value end of the retail spectrum. But they wanted to broaden their market to include more upscale merchandise (and margins). And, of course, they wanted to do it without losing their grip on their existing customer base. They thought Draft could do that.

The laws of marketing communications are about as inflexible as those that govern physics. And one of them is you can't be all things to all people. That's why Toyota launched the Lexus brand instead of introducing an upscale Avalon. Then Scion instead of a down-market Camry. Expecting an agency to be able to simultaneously move Wal-Mart up-market and maintain the present position and customer base was unrealistic, and failure was inevitable. (Although in this case the relationship didn't last long enough to collide with that particular piece of reality.)

Make sure your expectations are realistic.

Key #3: Make sure the styles of client and agency are compatible.

Folks who drive Aston Martins and wine and dine clients with breathtakingly expensive vodka martinis and trendy sushi aren't likely to be a good fit with a corporate culture that evolved from Sam Walton's old Ford pick-up truck and Coke-and-cheeseburger lunches. That's not to say client and agency have to look, dress, eat, think and speak alike. Only that their styles shouldn't be so dissimilar that one side regards the other as hopeless hicks or effete snobs.

Don't team up with folks you don't like. At least a little.

Wal-Mart isn't the only company that can teach advertisers through negative example. In fact, the columns of Advertising Age and The Wall Street Journal are full of cautionary tales:

Key #4: Don't tolerate sub-par performance.

Buick finally fired McCann-Erickson after decades of insipid – actually, invisible – advertising. Buick lost market share, momentum and the opportunity to capitalize on some attractive new models because they stuck with their old stand-by. The cumulative effect has been extremely negative for the brand and for the corporate parent's bottom line.

No agency hits a home run on every assignment. But while one bad ad won't wreck havoc with a brand, a weak campaign can. And a consistent record of ineffective work can have a devastating impact on a company's success or even its survival. Not to mention the survival of the advertising manager or marketing director who accepts inadequate performance.

Set metrics and fire an agency that fails to deliver.

Key #5: Work with an agency that defines "good" the same way you do.

A few months ago Crispin Porter + Bogusky resigned the Miller business because they were not comfortable with the quality of work coming out of their relationship with the client. It's certainly unusual for an agency to walk away form a eight-figure account over creative differences. It usually works the other way. But either partner in a client-agency relationship would be right to call it quits if they don't agree on what constitutes good advertising.

Before you hire an agency, look at what they do for other clients. If you like it you're on the way to a good partnership. If you don't, walk away. Thinking an agency will change its style after you're their client is as hopeless as thinking a mate will change her or his habits after you're married.

Realize that what you see an agency do for other clients is what you'll get, too.

Key #6: Define exactly what you expect from an agency.

Career Builder put its account into review because their commercials weren't in the top 10 "most liked" Super Bowl spots in USA Today's viewer survey. (Despite the fact that Cramer-Krasselt's campaign vaulted Career Builder past Monster to become the top of the job board.) Although a top ten "most liked" score is a monumentally stupid expectation, it is a clear, easily measured one. That single-minded focus would seem to simplify the search process: hire Kristin Dehnert, whose consumer-generated Doritos "Check Out The Girl" was the most liked spot of all in the USA Today poll.

Of course there are more meaningful expectations: sales increase, revenue growth or our favorite, return on marketing communications investment. But those aren't the only possibilities. Maybe the marketing director is looking for a golfing buddy. Or someone to pick up the check at the Palm. Whatever the key expectation may be, define it. Know what you want from an agency and spell it out. You won't get quantifiable results from a sycophant, and you probably won't be shamelessly schmoozed by top pros. But if you know what you really want going in, you're less likely to be disappointed.

Define – and share – your expectations.

Key #7: Be clear on your fish/pond expectations.

Crispin Porter + Bogusky did brilliant work for BMW's Mini Cooper brand, but the Mini Cooper was a relatively small fish in CP+B's large – and fast-growing – pond. When CP+B was not included in the review for the overall BMW account, they dumped the Mini Cooper business and took on Volkswagen. By itself Mini Cooper just wasn't big enough to be significant to the agency.

A recent posting on imedia connection suggested that advertisers consider agencies at which their account would represent approximately 30% of total billings. That's ridiculous. By that standard an agency could only have three clients. A three-client agency might not have the variety of challenges which encourage cross pollination of ideas. It would be perilously vulnerable to an account departing. Objectivity might be impaired by the desire to say what they think the client wants to hear rather than what it would be in the client's best interest to say. And it would be difficult to attract and keep top professionals.

In today's disintermediated marketing communications world only multinational advertisers need gigantic agencies. (See our "Lean Team, Fat Rolodex® page). Rather than going for an arbitrary percentage of billings, it might be reasonable to look for an agency at which your account would be among the top ten.

Be big enough to matter. After that, don't obsess over size.

Key #8: Good. Cheap. Sorry, you can't have both.

Fallon is a great agency going through a rough patch right now. You might think that they'd grab any business they could get. But their new business director, Helen Weisinger, recently said "We have turned down lots of business this year on a cost basis. We don't want to compromise our quality or our margins."

If an agency doesn't get enough income from an account to pay top people, it only has three options: put cheaper (generally less able) people on the business, lose money or cheat. Good agencies won't do any of those things. Shabby agencies will go with cheaper people. Foolish agencies will lose money on each account and try to make it up on volume. And dishonest ones will simply cheat.

Don't squander money, but be prepared to spend enough to do the job well.

Key #9: It's all about the people.

In a recent presentation to Coca-Cola, the myriad agencies of WPP were represented by the group's chairman, Sir Martin Sorrell. Sir Martin is a powerful force in the industry. An incredibly able entrepreneur. A financial whiz. And an accountant by training who doesn't actually work on any of the accounts handled by his agencies. Which may be why the presentation was not successful.

Some agencies have new business teams who go out and wrangle new accounts, then never see the client again. The most important people for an advertiser to meet and evaluate are the ones who will actually work on the account. And at a mega agency that won't be the chairman. The abilities of the professionals who will be doing the day-to-day work are crucial. The charm – or impressive bombast – of the agency's top management, irrelevant. Learn who's going to work on your business and what their qualifications and track records are.

Make sure the team you meet is the team that will be working for you.

Key #10: Define why you're firing your present agency.

Ernesto Gallo used to be famous for firing an advertising agency every year. Either he was one of the all-time worst at choosing agencies, or the problem was with him. And if you're looking for your third agency in as many years, you might want to consider that the problem may be you.

Of course there are some obvious reasons to fire an agency:

· Dishonesty.

· Failure to live up to schedule and/or budget commitments.

· Inability to adapt to a fast-evolving marketing communications environment.

· Professional incompetence.

· A revolving door bringing a constant stream of new people to work on your business.

· Carelessness with your confidential information.

Some are more subtle, but just as serious:

· Not challenging your preconceptions. That may seem like deference, but it's actually shortchanging you on the quality of advice – and involvement – you should expect.

· Failure to set or adjust your expectations to marketplace realities. If you set a goal of 25% market share with 10% of media spending, a responsible agency should point out that the goal may not be realistic.

· The same answer for every challenge. It's not always a :30 TV, especially not now. It might be behavioral targeting, public relations or skywriting.

· Shoddy work. Your brand is a valuable corporate asset. Shoddy work devalues it.

· They have plenty to say, but they don't listen.

· They listen, but they don't have anything to contribute.

Whenever you balance the pros and cons of your agency consider the cost, time, hassle and effort of bringing a new agency up to speed on your business.

And also consider the impact your present agency will have when they go to work for your competitor the week after you fire them. If you find yourself thinking that your present agency would make a competitor a stronger marketer, you might want to consider working out the kinks in your relationship. But if you think your present agency would be a liability to your competition, fire them ASAP. And if you're lucky a competitor will hire them.

Naturally a blog on hiring and/or firing an agency wouldn't be complete without a commercial message. But it's not that BrainPosse is the right choice for all clients in all situations. We're right for some clients, not for others. See the Why Hire Us? Or Why Not? section of our web site.