The latest study on advertising agency performance from the
Incorporated Society of British Advertisers (ISBA) makes grim
reading.
Agencies are failing to provide adequate service, to develop trusting
relationships, be innovative, be efficient, control costs and keep their
promises.
Agency staff are difficult to reach, planners are lacking when it comes
to monitoring and evaluating advertising, creatives still don’t listen
to advertisers’ concerns or understand their target markets, and
production departments fail to deliver value for money or meet
budgets.
On a grander scale, the majority of advertisers do not feel that their
agencies provide competent advice on business and marketing issues.
The ’Evaluating Advertising Agency Performance’ survey runs to over a
hundred pages and is based on interviews with 120 marketing directors
who spend pounds 1.2bn annually on advertising.
It follows a 1996 study, and is, essentially, designed to help
advertisers benchmark communications activities, according to ISBA’s
member-ship service director Debbie Morrison.
There is good news in the report, if you look for it: 75% of advertisers
are satisfied with agency creativity and 70% rate their agencies as good
or better than good when asked if they are satisfied overall.
Satisfaction higher
There have been improvements against all five key performance
indicators: contribution to marketing objectives, contribution to brand
standing, delivery of creative and innovative ideas and ads, value for
money and excellence of service.
Advertiser satisfaction with agency value for money has improved, from
just 20% in 1996 to 36% now. Equally, service has improved; 50% now
profess to be satisfied, up from 45% last time.
Of course, those figures indicate that just over a third of clients
enjoy good value for money, and only half are satisfied with the service
they are getting. In fairness, the actual level of stated
dissatisfaction with service has reduced significantly from almost a
quarter in 1996 to 14%, but that still leaves plenty of room for
improvement.
Clients with smaller budgets, or at smaller agencies, are happier with
the service they get; 59% of those with pounds 4m to spend, and 71%
using agencies which have billings of pounds 30m or less, are
satisfied.
Cynics might argue that small agencies are just big agencies waiting and
trying to grow, but the picture that emerges is one of large agencies
consistently ignoring what their clients want, Morrison says.
Medium-sized agencies offer good creative understanding but are less
responsive and proactive, while the biggest agencies (those billing
pounds 100m or more) are the best on account planning, but register
lower levels of satisfaction on service and creativity.
Client satisfaction with the ability of agency staff to keep their
promises has dropped from 63% in 1996 to 59%. There has been a slight
improvement in their ability to get services right first time from 23%
to 25%, while the number of advertisers unhappy with agencies’
commitment to error-free records has gone from 36% to 46%.
There has been no improvement in account management, and satisfaction
with attention to house-keeping has fallen from 65% to 48%.
People skills
Agency staff are both loved and loathed. They are willing to help (86%),
are courteous and pleasant (89%) and take the trouble to ensure the good
appearance of their agencies and themselves (79%).
But client satisfaction with their ability to provide a prompt service
doesn’t make the halfway mark (48%) and fewer advertisers are satisfied
with their ability to reach agency staff and get them to respond without
unnecessary delay than three years ago (58% in 1996 and 51% in
1999).
Since the last recession, agencies have invested less in training. It is
widely accepted that there is an experience gap between the 20-something
account handlers and the 40-something agency managers. Many of those
that should be in the middle (in terms of age and seniority), providing
solidity and experience, left the business in the last recession or were
never recruited in the first place. Their absence is becoming
evident.
WPP non-executive director Jeremy Bullmore comments: ’Clearly, there are
long-standing problems with reliability, efficiency, transparency and
providing serious all-round understanding.
’There is huge room for improvement, and, given the alternatives that
are available to marketers, we must make sure we address these important
issues.’
Agencies may have much to do but marketers must also take some
responsibility for the poor or less than fabulous service they are
putting up with.
As Bullmore points out, more money is being spent through agencies than
ever before. Marketers must make their needs, wants and desires clear to
their agencies, and set out formal performance criteria so that both
sides agree what they can and should be achieving.
And there is the not insignificant matter of money. Marketing
departments and marketing budgets are under ever-increasing pressure,
which transfers readily to the agencies that serve them. If you pay
peanuts, you get monkeys.
THE CLIENT VIEW
My agency contributes significantly to meeting my marketing objectives
1996 1999
Agree 79% 83%
Disagree 6% 6%
My agency makes a significant contribution to the standing of my
brand/service
1996 1999
Agree 73% 78%
Disagree 10% 5%
My agency has excellent creative ideas
1996 1999
Agree 67% 75%
Disagree 11% 4%
My agency offers excellent value for money
1996 1999
Agree 20% 36%
Disagree 35% 26%
My agency offers excellent service
1996 1999
Agree 45% 50%
Disagree 24% 14%
Staff at my agency can be relied upon to keep their promises
1996 1999
Agree 63% 59%
Disagree 11% 11%
Note: neutrals account for remainder of percentages.
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