- Performance based fees have a reputation for being difficult to implement and have poor outcomes. This is usually because they have been badly implemented to lower agency fees.
- It is also because often they are based on ‘soft’ measures such as relationship and task performance and not measurable marketing and business metrics.
- They ideally work in direct response business models where the agency inputs have a direct and measurable result.
- It also requires a balance of risk and reward for the agency and therefore setting metrics and fees is critical in getting this right.
- Performance based fees are often part of a hybrid model where the base fee is paid to the agency with a performance component on top.
- Read more on successful Performance Fees here
I’ve been involved in selecting agency partners for over twenty years and I have been extremely impressed with the knowledge, professionalism and integrity demonstrated by TrinityP3 during our recent pitch. They guided us through a rigorous, holistic process and proved to be an invaluable source of advice to myself and my team. TrinityP3 has delivered a great return on investment to Monash University.— Margot Burke, CMO at Monash University