How to get a great ROI from your agency: six tips
This is the third in a series of posts exploring how to work with marketing agencies. In the first post, we looked at how to identify the type of help you need, shortlist potential partners and invite them to pitch. The second looked at how to brief your chosen partner and agree budgets. In this final post, we’ll look at how to manage your agency relationships and get the most out of them.
A good agency that is well managed should be able to deliver on your brief. An agency that is poorly managed will struggle, irrespective of how good they are. As a business leader, knowing how to manage agencies is essential if you want to see a good return on your investment.
Here are six ways to get the most out of your agency relationships.
Be prepared to invest time in the relationship
Agency relationships are a two-way street. Both sides have to invest time and effort to create a productive partnership. Especially in the early stages, when the agency is getting to know your business and both sides are getting a feel for the working relationship.
Regular, honest and transparent communication is important. This will require both sides to set aside time to discuss the work that has been completed, what’s to come and reflect on the working relationship as a whole.
"Make sure that both sides are clear on what’s expected of the other."
The agency will usually outline a fixed number of hours or deliverables that they will commit to in return for their fee. As the client, you may also want to agree upon a set number of hours that you will invest in supporting their work. This will help the agency understand your level of availability and make sure that both sides are clear on what’s expected of the other.
Regularly evaluate performance
Your brief should have outlined how you will evaluate your agency’s performance and what their KPIs are. If you’re wondering why this is important, take a moment to read this article.
Once the work is underway, make sure you stick to your performance review processes from the very start of the working relationship. Even if you’re unsure on what metrics to include and you have no historic data to use for benchmarking, measuring something is always better than measuring nothing as it forces the discussion about performance and improvement.
You may also want to ask your agency to provide reports or examples of performance reviews from their other clients, so you can see how others are evaluating their performance.
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It’s also worth communicating what the goals of the performance reviews are. Some agencies use reviews as a way of demonstrating what a great return they’re delivering. These reports tend to focus on the good news and skirt around the bad.
The purpose of your reviews isn’t to validate their fee, it’s to identify what’s working and what isn’t, so you can do more of the former and less of the latter.
Keep things fresh
Once the work is underway, changing agencies can be a bit of an ordeal and it probably isn’t something that you want to do unless you have to.
That said, it can be a good idea to shake things up every now and again – especially if you’ve been working with the same agency for quite some time. One way to do this is to switch the lead account handler or point of contact. If you’re working with a creative agency, you may ask to switch the designer, copywriter or creative team.
New people will contribute new ideas. One of the advantages of working with an agency is the broad range of skills and backgrounds they give you access to. Don’t limit your access to just a small pool of their talent.
Manage your payments effectively
Most agencies will be paid on a project-by-project basis or receive regular payments of a fixed amount - typically called a ‘retainer’. Which one you choose depends on the nature of the work.
Short-term or one-off projects such as web development, strategy creation, rebrands, one-off pieces of content or CRM implementations are more suited to individual payments.
Long-term projects such as SEO, regular content creation or inbound marketing are more suited to a retainer.
Some agencies, particularly lead generation agencies or SEO, might suggest ‘payment for results’. This may sound appealing, but it can be a bit high-risk for relationships which are just getting started. For example, the "results" that trigger the payment may not really be relevant to the business results or the marketing plan.
"Things change and it’s good to stay flexible."
If you choose a retainer, commit to a notice period of 30 days but no more. Things change and it’s good to stay flexible. You also want to make sure that your retainer specifies the deliverables or results that are expected in return for each payment and that these are evaluated as part of your review process.
You may also want to speak to your peers about what they pay in return for their agency services. Comparing notes is a good way to make sure that your agency’s fees are competitive.
Provide clear feedback
Agencies will share their thoughts and ideas with you for approval before they start producing or doing anything. This reduces wasted time and makes sure that you have the final word on their activity.
Clear, specific and constructive feedback that explains what you like, what you don’t and suggested improvements where appropriate will save everyone a lot of time. Vague feedback that raises concerns without specifying what’s wrong or how it can be improved will slow the process down.
It’s also important to show your agency how the overall strategy is performing and the impact of their work. Positive results will give them a sense of achievement and show them what’s working. If the agency isn’t hitting their KPIs, this also needs to be discussed so that both of you can find a way to meet your goals.
Introduce your agencies to one another
Many companies have multiple agencies or external suppliers. It’s important for your agency partners to see eye-to-eye and cooperate closely. It can be tempting to keep your agencies separate, but this tends to lead to siloes and poor levels of communication.
Cross-agency meetings - especially if you’ve just bought a new agency onboard - are a good way to build inter-agency relationships. The ideal situation is for your agencies to discuss ideas and approaches with one another without using you as a middle-man. Establishing open channels of communication will facilitate this.
That brings us to the end of our series on finding, briefing and working with agencies. Every agency relationship is subtly different, but there are best practices that can help you make the most of your investment. A well managed agency can add considerable value to your business, bringing in expertise, energy and new ideas - all helping you to achieve your goals. It just takes time and effort on your part too, ensuring you make the right selection, deliver a good brief and manage the relationship so that both parties get the most out of the collaboration.
For more information on how to ensure your agency contributes to your bottom line, download Making Marketing ROI Work For You.