The relationship between client and agency has never been more important. One only has to look at the declining number of new molecular entities approved, the dramatically changed model to access today’s physician, the ever-increasing cost of print, broadcast, and digital message creation and delivery to understand the stakes today have never been higher for success in pharma marketing.
And, yet, the client-agency relationship continues—on the whole—to be challenged. Data from the 4As (The American Association of Advertising Agencies) confirms that the average tenure of an agency of record (AOR) assignment is about three years, continuing a downward spiral in client-agency marital length. For many clients and agencies, the relationship has become asymmetrical, a situation that is as bad for client-agency relationships as it is for any other relationship or piece of architecture for that matter. And that lack of symmetry is a major source of why things fail. Restoring that symmetry with four simple concepts is key to restoring health, trust, longevity and mutual success.
How “Symmetry” Makes Relationships Work
The first question you may be thinking is: “What does symmetry have to do with agency management?” Isn’t that a geometry concept? If you look up symmetry in your dictionary, definitions speak to corresponding in size and form, or proper proportions, or my favorite, beauty based on proportionality. What it all speaks to is the relationship of things in proper proportion—think Jefferson’s white pillars at Monticello, think of a ballet troupe working across a stage. And, symmetry matters in the delicate relationship of client and agency. Here’s how.
So, the first part of our story starts with this question: How did so many client-agency relationships become asymmetrical? It’s important to acknowledge that client brand and marketing managers’ jobs have never been harder. Almost universally, brand managers are asked to do more with less and do it faster. And, oh by the way, impress your management with something innovative. Moreover, on the client side, the brand team is not the only “client.” The procurement or agency management team is also a critical stakeholder with a very important and relevant voice at the table. There are now at least three parties: 1) the brand manager, 2) the client chief commercial head or VP marketing, and 3) the procurement partner. It’s pure math: Multiple clients isn’t bad or good it’s just more complex.
Now, let’s look at the agency side of the current equation. Agencies have been asking for this triumvirate of clients to create partnering opportunities. Here again, though, 4A’s data confirms that as recently as May 2014 only 29% of agencies indicated that they were participants in a two-way client-agency annual review. That means the vast majority are simply the old-school one-way (or asymmetrical) annual review of only the agency. Or, worse yet, perhaps many agencies go without any formal review conversation at all.
Similarly, agencies have talked about creating incentive compensation to tie agency comp to brand performance in some way. The data here again from the 4A’s suggests that only 39% of agency chiefs report an incentive compensation plan to tie the agency to the client’s results. All of this points to many relationships that may just be out of balance.
Here’s four ways to get things back in balance and to truly create the symmetrical, partnering relationships we all desire:
1. Define successful outcomes from the start: You wouldn’t start building a house without a blueprint from the architect, so it makes perfect sense not to embark on a new client-agency relationship without agreed upon metrics of what constitutes success. This can and should include not only creation of the campaign elements (the SOW line items), but also things like what the team will look like in twelve months; how will we measure and test creative; what business results we want to achieve.
2. Include all the key stakeholders: Because the landscape now includes both the marketing team and the procurement team, these key individuals should be part of the on-boarding, the scope building and the definition of what success looks like. Procurement teams bring real value to the table and can be real agency allies—not enemies.
3. Don’t be afraid of a real two-way performance measurement tool: Report cards work best when both parties complete them and discuss them candidly. This is the place to talk about the account director who will need a change sometime next year (before a client is blindsided by change). This is the place to talk about good hygiene practices of how we communicate with each other.
4. Keep senior management involved: This works both ways. Agency senior management needs to not only sell-in the business, but also be committed to the client’s brand and to contribute to the success of that brand. On the client side, it is important for senior marketing management to stay involved in some of the big decisions. Early participation eliminates wasted hours on off-target work, thus driving up satisfaction and driving down cost.
In summary, the landscape has changed. The world of pharmaceutical marketing is definitely more complex: Fewer new brands, more mediums for communication, greater costs, more stakeholders. But, as much as some things have changed, the client-agency relationship is still about trust. The relationship is real, organic. It does require careful communication and nurture like any other relationship. Balance can be restored. Brand managers can rely on an agency partner, and agencies can have enduring long-term relationships. It just takes hard work and a commitment to symmetry.