The financial negligence demonstrated by creative agencies in production
February 5, 2013
This post is by Darren Woolley, Founder of TrinityP3. With his background as analytical scientist and creative problem solver, Darren brings unique insights and learnings to the marketing process. He is considered a global thought leader on agency remuneration, search and selection and relationship optimisation.
One of the most common causes of frustration for marketers with their creative or content agencies is the cost of production. While cynically you may think this is good for consultants like TrinityP3, it is incredibly damaging for the relationship between the marketer and their agency, especially to the issue of trust.
In the past six months we have been called in to assist with productions where the cost of production is two or three or more times the budget allocated by the client. This usually occurs within the critical timeline before the on-air date and is a time of pressure and stress for all involved. Beyond how to resolve this situation is how did the agency get the marketer into this situation and how can we ensure it does not happen again?
(Italics indicate the problems and offers a solution).
The marketer briefed the media and creative agency on an advertising campaign for a product / brand in the portfolio. This was activity that had been scheduled on the annual marketing plan. The brief was running late and so the agency went straight to work on developing the reverse brief and concepts.
In this case the marketer did not provide a production budget or any indication of the level of investment at all. When talking with the agency it was asked on what basis did they develop the idea in relation to the cost? There was no answer. Could you imagine any other ‘professional’ like an architect or a lawyer starting any project without a clear understanding of the budget? I don’t think so.
The agency developed a concept and presented this to the marketing team. In the meantime the media strategy and plan had been developed and while the campaign was primarily driven by television there was a requirement for other ‘support’ media including outdoor and digital.
This project is already spiralling out of control. It was briefed late and so the agency should have taken control and developed a timeline or schedule for concept development, approvals, research and production and held the marketers to this, defining the costs of missing any of the key milestones. But instead it is already meandering along towards disaster.
The creative concepts were reviewed and feedback provided and the agency asked to develop further concepts. Further concepts were developed as weeks ticked by.
I am always amazed that at this stage the agency producer was not engaged. They are the production experts within the agency and yet the agency doesn’t get them involved in managing the process until concepts are often approved and the timeline is too tight to be cost effective.
A concept and scripts were approved by the brand manager, with changes before presenting to the marketing manager. The marketing manager approved the scripts with changes before presenting them to the marketing director. The marketing director made changes before approving them and the concepts were sent to regional for approval. Then the concepts would be placed into concept testing research and so animatics were required.
Without the agency timeline or flagging the shortage of time the marketing team fell straight into their usual (an hugely inefficient way) of obtaining feedback, approval and consensus. This approach is fragmented, time consuming and often has the agency running around in circles trying to appease each person in the process. Collective wisdom is the best approach so either get everyone’s feedback and provide it at once or simply get the feedback of the only person who can approve the script.
Time was already short for production, but now it had become critical.
Having come out of research without any major changes the agency briefed production houses who prepared quotes and treatments in five days. The quotes were reviewed by the agency and then presented to the marketers. It was almost three times what the marketer had paid previously and what they had allocated.
Of course it would have been hugely helpful if the marketers had told the agency the budget. But then why did the agency commence work without knowing this important fact?
In the meantime the media had come back and informed the client that the media budget could not support the number of 30 second commercials briefed and one 30 second and two 15 second versions would be ideal.
The creative agency began the process of developing 30 second versions of the scripts for the film company to re-quote. Not surprisingly the proposed cost of one 30 second and three 15 second versions was only marginally less than the original requirement of three 30 second and three 15 second executions.
When there is no time to get the production made, there is certainly no time to negotiate and so the marketers were paying top dollar although the agency was swearing black and blue this was not the case. Developing a timeline at the time of briefing allows enough time for approvals and negotiations.
The marketers asked the agency to go back to the production company to reduce the cost. The agency said that at six weeks to on-air it would be almost impossible to deliver the production as it was and finding an alternative was also impossible.
Here is why time management is not a high priority for many agencies. With just six weeks to on-air the imperative becomes getting the spot made ‘at any cost’. That is the point. The time pressure and the consequences of not meeting the media on-air deadline outweigh the additional 200% above budget the agency delivered.
The marketer then called TrinityP3.
The outcome was not pretty. The relationship with the agency was damaged. The marketers suddenly realised that this whole time they had been wasting money and yet the agency they relied on to look out for their best interests had continually stood silent and blamed the production industry, blamed the lack of time and blamed everyone but themselves.
Have you experienced similar disasters? Let me know with a comment.