Brands Need To Stop Treating Their Agencies Like A Dentist

Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Kerry Bianchi, CEO at Collective.

After an open season on shady ad industry practices, resolving transparency problems has moved to the top of the agenda for many concerned brand clients and their agencies. But this isn’t going to be a simple Band-Aid fix for the industry at large.

You know the score: An eye-opening ANA report revealed numerous questionable ad agency practices. And P&G’s Marc Pritchard, CMO of the world’s biggest advertising customer, put agencies and intermediaries on notice that systems clouding true media spend, performance or arbitrary fees would no longer be welcome.

In a previous life as a consultant, I helped Fortune 500 CMOs drive value from their advertising investment by benchmarking and auditing their media execution and designing compensation and incentive structures for their media agencies. When an account was up for review, we helped the client evaluate and select the right agency, advise on key contract parameters, recommend best practices and set ground rules for measurable performance metrics.

This process set down all the upfront rules, fees and structures wanted in an annual agency audit. However, the measurement and evaluation process to ensure compliance could take weeks to properly analyze and collate all of the buying data, and it typically would occur annually or biannually. In the most aggressive cadence, it happened quarterly.

For a media world that works at a pace increasingly measured in terms of minutes and seconds, this can seem a glacial pace for a feedback and assessment loop. It highlights that if you are not continually engaged in assessing your agency and third-party partner delivery, things can easily slip into the disarray and opacity these CMOs have begun to question and fear.

A media audit is a cleansing, healthy practice – but it takes time. And audits, of course, tend to be backward-looking. If you only uncover some questionable practice from Q1 at year’s end, there’s not much you can do about it that can impact that year. If a report takes a couple of months to produce – and you are already in the next year when you start to act upon the results – suddenly, you are in a two- or even three-year cycle to impact the performance changes you seek.

You wouldn’t manage your health this way. You can go see your dentist for your annual check-up with the best intentions but, if you don’t brush and floss your teeth every day between check-ups, those exams tend to be more painful and the process to turn around the ill effects of months of poor practices can take a long time to repair. However, if you brush and floss your teeth thoroughly every day, you might avoid a painful root canal every six months.

In the same way, clients should aim to establish agency and vendor relationships in which they are not goal-setting and reviewing at long intervals while operating in the dark in between. A healthy relationship entails ongoing monitoring, feedback, analysis and improvement. Brands need to practice their own account hygiene on a daily basis. It’s up to the client to adhere to the regimen and fully leverage the agency’s expertise to identify, assess and treat issues in advance.

That means securing transparency by opening up a continuous feedback loop in which detailed performance results are out in the open and insights and actionable next steps are easily enacted. There are two core pillars for gaining more transparency and control.

The first is to institute easy access to data and metrics that matter, including transparency into costs, quality and performance. Everyone should be focused on the same KPIs and able to access them easily and regularly.

The second is to schedule check-ins to analyze that data together and understand how and why decisions and recommendations were made. The goal of those meetings is not only a greater abundance of data, but also more insights and recommended actions.

Together, transparent access to data, visibility into performance and a regular feedback loop to discuss improvements are the recipe for a healthy regimen to drive better business performance.

Follow Collective (@collectivesays) and AdExchanger (@adexchanger) on Twitter.

 

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