The True Cost of Pitches

13 November 2013

There are far too many pitches in this business. I appreciate that they’re the fuel that drives much of our trade press; I understand that they are the reason we have so many fine new business directors (not to mention pitch consultants); I get it that they’re a great example of agencies at their best – with disparate specialists coming together in a common cause, namely to beat the other guy.

Pitches are disruptive, often distracting, and take up a great deal of time. Of course sometimes there’s no choice but to change, but too often the decision to change is a knee-jerk reaction to a particular problem; a problem that could probably be solved by a candid conversation between client and agency.

Many years ago I worked on the Kellogg business at Leo Burnett. Kellogg’s at the time had two ad agencies, us and JWT. There was an agreement that outside the USA (an important condition that, of great benefit to Leo Burnett at the time) the two agencies had 50% of the billing each. Kellogg brand managers at the time lived by a bible, a ‘here’s how we do things at Kellogg’ book. The first sentence in this book read (I paraphrase) “It is not your job to change the advertising agency. Rather it is your job to get the most from the agency.” Having problems with the team? Not satisfied with the work? Then by all means insist the agency changes the team. But you don’t get to change the agency.

I’m sure other clients had similar rules. In my personal experience Procter and Gamble has always been a wonderfully loyal client, so has McDonald’s. I understand the same is true of Volkswagen, Guinness and Sainsbury’s. It can come as little surprise that all benefit from highly effective, consistent advertising.

Over time, brand and marketing managers come and go but in a long-term solid relationship the agency continues along. The agency becomes the true guardian of the brand and its heritage as well as being the keeper of what-has-worked. When agencies attain this status their relationship with their clients becomes a partnership based on a mutual respect (where it should have been all along of course) as opposed to that of a master and supplier.

The problem lies in being able to maintain that sort of long-term relationship within a world of ever-changing personnel. Marketing Director leaves; new Marketing Director arrives and as sure as night follows day, a pitch follows the leaving and welcoming parties. It’s easy to say that agencies should build relationships at Board level, and with executives beyond the Marketing Director, but it’s harder to do – especially within those organisations who don’t consider marketing to be a key business driver.

It’s these non-marketing-driven organisations that relegate advertising to a commoditised service, best procured at as low a price as can be achieved. Now, I have nothing against procurement per se, but if there is to be a beauty parade then surely the order of things should be: marketing director or above selects, then procurement procures the service selected at the lowest reasonable price.

It would be most enlightening to learn the true cost of a pitch to a client. Forget intermediary costs, the true cost needs to take account of any business disruption, quite apart from the cost of executives’ time. Maybe if these costs were ever calculated and shared with the client’s Board of Directors there would be fewer pitches, and more long-term relationships.