Campaign India Team
Feb 25, 2020

Reducing agency costs reduces results: Aprais study

Study investigates 21,000 cases which relates remuneration and its impact on the service an agency delivers

Clients should seek cost savings from their agency but they need to be clever about it
Clients should seek cost savings from their agency but they need to be clever about it
According to a study undertaken by Aprais, financially considerate marketers get better results from their agencies. 
 
The agency investigated 21,000 cases to check whether a marketer's regard for its agency’s remuneration impacts the service it delivers.
 
The analysis revealed that clients rated in the top 10 per cent for their sensitivity to their agency’s finances received a much better (21 per cent) staff allocation to their business than the least considerate counterparts.
 
 
Top scoring clients achieved 16 per cent better creative performance from their agency compared to the low scorers. 
 
Key messages for agencies
 
Be transparent about the relationship between fees and the resources it buys - especially the access to senior-level agency personnel. 
 
Ensure your team contains at least one trained and experienced negotiator. Don’t confuse the skills of ‘selling’ and ‘negotiating’.
 
Key messages for marketers 
 
Agency agreements should be negotiated in two stages. Marketers should first decide the required involvement of the agency’s senior management. The first negotiation is between marketing and procurement to create a workable fee package. Only then can the client-agency negotiation take place.        
 
Clients should seek cost savings from their agency, but these should be achieved through the optimisation of work processes and reducing the number of stakeholders rather than by reducing the input of key staff. 
 

 

Source:
Campaign India

Related Articles

Just Published

19 hours ago

Facebook removed 7 million Covid-19 misinformation ...

The social-media network has shed light on the scale of the coronavirus misinformation problem, with posts related to fake cures among the millions it has removed over recent months.

19 hours ago

Spikes Asia brings awards forward to February 2021

Inaugural Spikes Asia Creativity Report will also be released as the awards move to become an early regional benchmark in the leadup to Cannes Lions.

19 hours ago

Drawing conclusions with Aditi Jain

Weekly commentary, observational humour and satire on contemporary events by Aditi Jain, director - brand strategy, Ogilvy

1 day ago

Amazon shows ease of selling on platform

Watch the films conceptualised by Ogilvy here