Welcome to the March edition of TrinityP3’s e-news
Currently in the UK, there is a move by the IPA
and ISBA to develop and implement a Pitch Positive Pledge (PPP), the
development of which TrinityP3 is actively participating in and supporting
through our London office. The purpose of this pledge is to develop a
commitment to guidelines to make the pitch process more sustainable with less
negative impact on the mental and physical well-being of all involved,
particularly the agencies.
Invariably, as part of this process, the
discussion turns to the payment of pitch fees. Therefore we thought it
worthwhile exploring the idea of the payment of pitch fees. While we are not
against pitch fees, we do believe that the payment of a fee will not address
the issue of overworked and burnt-out agency teams. Even with the Ouch Factor
last year identifying an average of 172 hours spent on each pitch, a payment of
the equivalent in lost revenue would not address this as we point out in “Why
the real cost of pitching is not financial”
. There is also a link to
participate in this year’s Ouch Factor research too.
Next, there are still marketers, procurement
people and consultants who have a business and fee model that actually has the
agencies pay a pitch fee, either to be considered for the pitch or paid on
success. Neither of these is sustainable or fair, as we explain in “Who
should pay for the pitch?”.
Finally, we explore when
clients should pay for the pitch and include an analysis of what is a fair and
reasonable amount in “When should you pay for the pitch?”
. And if that
is not enough about pitching then check out the free Pitch Consultant’s
Definitive Guide to Pitching.
Why the real cost of pitching is not financial.
If you have not seen the OUCH! Factor research from last year, it
is definitely worthwhile to watch the Mumbrella360 Short video here
and
download the report here
. The
research report and the video were the work of Julia Vargiu, founder and
Managing Director of New Business methodology.
Trinity P3 was invited by Julia to assist with the research and
provide industry commentary on the results around the cost of agency pitching.
As pitch consultants, we are aware of the cost to both agencies and
advertisers, and we try to minimise these in our management of the process. But
this was an opportunity to quantify the cost.
Our concerns are that while both clients and agencies who
participated in the research are rightly shocked by the findings, little or
nothing will change in industry practice – and for one very good reason. The
real cost of pitching is not a real cost to advertising agencies, except in the
mental and physical health of their staff. Let us explain here
.
Why the real cost of pitching is not financial.
If you have not seen the OUCH! Factor research from last year, it
is definitely worthwhile to watch the Mumbrella360 Short video here
and
download the report here
. The
research report and the video were the work of Julia Vargiu, founder and
Managing Director of New Business methodology.
Trinity P3 was invited by Julia to assist with the research and
provide industry commentary on the results around the cost of agency pitching.
As pitch consultants, we are aware of the cost to both agencies and
advertisers, and we try to minimise these in our management of the process. But
this was an opportunity to quantify the cost.
Our concerns are that while both clients and agencies who
participated in the research are rightly shocked by the findings, little or
nothing will change in industry practice – and for one very good reason. The
real cost of pitching is not a real cost to advertising agencies, except in the
mental and physical health of their staff. Let us explain here
.
What’s the hidden cost of pitching? Take the OUCH! Factor Survey
Do
you know the hidden cost of pitching? How much does it cost the agency? How
much does it cost the marketer? How much does it cost the industry?
The first point I have to make is “Why are you pitching anyway?”
But the fact is that pitching is happening
throughout the industry and across the globe. Not just creative and media but
increasingly other disciplines including technology providers, call centres,
POS vendors and more.
The diversity, range and depth of marketer requirements is growing
and seemingly endless.
But in all this pitching has anyone considered the costs? I am not
talking about the emotional and social cost; I mean the hard financial costs of
the pitch process.
We have written about pitch fees several
times, as the issue appears to be a
contentious one. As we maintain, the time to consider paying pitch fees is
when:
You want to buy the rights to
all concepts, not just the winning concept;
You require the agencies to
prepare materials and incur external costs beyond what would be considered
standard;
You are engaging an excessive number
of agencies in the strategy / creative stage of the process.
But let’s consider how much to pay.
Debbie Morrison, who was Director of Consultancy and Best Practice
at ISBA for many years, was quoted as saying, “typically advertisers
offered a token sum of between £3k-£5k”.
The key word here is “token”.
While some may feel that the payment of pitch fees to the agencies
is a sign of goodwill, it can also appear as a token payment for the many hours
and out of pocket expenses that are involved in participating in the pitch
process.
We provide some guidelines for the three reasons you would pay
pitch fees and some recommendations on what you should consider paying here
.
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