Media Contracts and the Evolving Dynamic of Client-Agency Relationships


Christine Moore of FirmDecisions discusses the future of work through media contracts and the evolving relationship of client agency relationships. 

Christine Moore
Managing Director FirmDecisions North America
 

We have all been through a hard year around the world, where every single aspect of our lives has been put to one test or another due to the common factor of the pandemic.

In the business arena, client-agency relationships have also been put to the test and through this experience we have seen an unexpected – but widely appreciated outcome – the evolving client-agency relationship.

 

Improved collaboration and trust

When speaking to clients, agencies, and other marketing industry players we see that we have come a long way in building collaboration and trust in the client-agency relationship. Up until the pandemic, these two words were rarely used to describe an existing client-agency relationship. But we have seen a lot of mutual problem solving and cross agency and client cooperation to solve marketing problems as well as business problems. And we believe that is here to stay. As human beings we feel better in relationships where we can instill trust in our business partnerships.

 

Wider marketing industry agenda

The client-agency relationships (partners) have also jointly taken on a wider marketing industry performance agenda during the pandemic. Instead of focusing on the to-do lists between clients and their agencies, they have started to show a united front in other areas of marketing which may need better rules of engagement – for example marketing performance, diversity, inclusion and sustainability discussions.

The industry has moved from an eco-system of few players interacting in a close universe to a much larger and more accepting area for new ideas and break throughs. It is now up to the client marketers to ensure that they benefit from the wider playing field and ideas while keeping the rules of engagements strong, transparent, and productive – all the while being open to interact, share and collaborate with trust. Not an easy task. 

How can the marketer and their marketing procurement team make sure they lead the dialogue and achieve best practice while continuing to eliminate waste?

 

Strong marketing contracts are imperative

It starts with the marketing contract. Most of the media spend is regulated by a media contract and because of its size, dollar wise, this area has been the focus of scrutiny for many years. We have all included words such as transparency, audit rights, reconciliation, penalty, savings, and other language in our media contracts. And these terms are still very much in demand and vital for the success of a client-side marketer. However, the application goes beyond the traditional media contract. Clients now seek to exert similar rights in their contracts guiding the digital media, programmatic, e-commerce, sponsorships and even market research arena.

Despite the type of media becoming more fluid, the contract rules should stay the same. Clients still need to – and want to – instill trust through validating that marketing partners deliver what the client-agency contract says.

It is imperative for clients to stay on top of implementing the rules of engagement across their entire agency roster. While working with many different marketing partners to deliver the optimal marketing experience to the consumer, it is important to have a solid, forward-looking way to measure and improve the marketing eco-system. In this framework, you level-set expectations between the client and each of the agencies on the roster, then measure the success and drive an agenda of improvement in real-time. This ensures that the newly defined client-agency relationships, across new and old marketing spend categories stay relevant, transparent, and enforceable. The old days of using the rear-view mirror to see what went wrong are over.

Understanding your baseline

When the pandemic hit, several clients had a hard time understanding their baseline in terms of agency contracts, obligations and rights. It took several months to establish what the current status quo was. Then, and only then, could clients move towards change. The speed of change has increased during the pandemic. We have seen many new, informal ways of working, which has allowed clients and agencies to develop custom contractual relationships. This is great, and innovation has thrived in these environments.

However, most of us still work in a corporate environment and it is our duty to make sure that we limit risk and ensure that our contracts are watertight and deliver on the goods clients think they are buying. The marketer having their finger on the pulse of how their agency manages the business allows them to better adapt when new challenges arise.

 

Hold on to top talent

The high activity in the pitches will impact clients in several ways. The top agency talent will be pulled from current accounts to work on new business, leaving less focus on the current client account. Top talent will also be lured to follow account moves or will be poached to other agencies as they win business.

Clients should review their current talent pool to ensure that they have the right type of functions as well as the right level of seniority on the account to deliver on their unique set of goals and challenges. They need to ensure that they retain the right to reconcile FTE staff plans as well as conduct period burn analysis, so they can understand how their business is being serviced, when and by whom.

 

Be open to partners

As the industry is catapulted into a new era of e-commerce, digital, new consumer behavior and a cookie-less environment, clients and their procurement teams need to work closely to develop a transparent approach to manage the agency partners across all marketing spends. It is all interconnected and if you have a similar framework to measure, validate and inform decisions across the board, clients will have a common currency to discuss future strategies and how to implement them across all areas of marketing.