The Non-Pitch Pitch - Improving Your Incumbent Agency's Performance

12:07 PM, 21 August 2015
A major automotive brand recently presented to the World Federation of Advertisers' Media Forum on an initiative to engineer greater value from their incumbent media agency, without going to a full pitch situation.

The business challenge was that the advertiser had been working with their incumbent agency for more than 10 years, and had subsequently identified areas within the relationship which needed updating: buying rates/fees, central services, local scopes, contracts, and performance models.

But in spite of this the client also identified a number of strengths, including the local relationships in place, strong audit results and relationship scores, plus years of embedded knowledge. Also, critically, there were few 'un-conflicted' agency options, making it difficult for the client to move the media account.

The solution

The decision was to run a 'closed pitch'. Run exactly like a traditional pitch, but only inviting the incumbent agency to participate. The incumbent's offer was to be full and final with the next step being either:

  • a new contract offered to the incumbent, or
  • proceed to a full pitch process, without incumbent.

Effectively the agency had first opportunity to make its case to be retained - and a compelling case would result in a new contract without an open competitive pitch.

The journey

In order to set the tone, the process was run exactly as a full pitch, via a Project Team, with a formal response required to all challenges. Critically - the level of potential risk was nurtured at all times. Any threat of termination had to be real.

The outcome

The advertiser reports that the process resulted in a number of financial savings staged across several years plus a 'future-proofed' agency model, based around best-in-class service, enhanced business planning, analytics, econometrics and data.

Was it the right decision? Could the client have obtained more through an open pitch? The answer from the advertiser was unequivocal:

  • The client generated more in cash savings for the current and next year
  • The client achieved a better servicing structure and a more robust contract
  • An open pitch may have delivered a benefit, in potentially higher % commitment in the subsequent two years and a lower out-of-scope rate-card but overall the benefits wouldn't have come without significant disruption to business as usual
The result was a very satisfied client and a media agency who has retained the business. A win-win. Thinking of pitching? ANZA can help. Please email lindsay@anza.co.nz
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