Ad Agency RFP Rejection Rate Hits All-Time High
Ad Agency RFP Rejection Rate Hits All-Time High, According to AgencyFinder Data
AgencyFinder’s CEO provides some clarity on recent reports that ad and PR firms are starting to turn away requests for proposals because of their low budgets, unrealistic expectations and vague direction.
RICHMOND, Va., Nov. 6, 2013 /PRNewswire/ — “We find most ad agencies and PR firms follow “the customer is always right” rule – it’s just that they’re now realizing not every customer is right for their business,” says AgencyFinder CEO and Chairman, Chuck Meyst. The Richmond, VA-based search and selection consultancy has helped advertisers find marketing service providers for projects and long-term account assignments since 1997, “But I’ve never seen the climate for new business be as disrupted as it is right now,” says Meyst.
Meyst cites Rupal Parekh’s recent article in Ad Age (October 25th) that provided a concise summary of a problem he’s seen developing over the past 15 months. In the article, Parekh writes: “Fourth quarter is typically when agencies go into a new-business frenzy, licking their chops for a chance to bring in fresh accounts. But a funny thing is happening this year: Many requests for proposals are leaving a bad taste in agencies’ mouths. Shops are taking a look and tossing them out.” AgencyFinder’s own internal measurements seem to bear that out.
“We conduct hundreds of small and medium-sized account searches a year,” explained Meyst. “So it’s natural for us to see an ebb and flow in deal volume every year.” He explained that search volume typically starts to back off in November and December as consumer-driven business is neck-deep in holiday sales volume and business accounts are wrapping up their fiscal years.
“One long-recognized fact for everyone – client and agency alike – is that January is a time for planning and preparation; the wheels of action and spend tend to start turning in February. One would think that means most agency searches for Q1 projects wrap up before Halloween – but that’s not been the case this year. Instead, there’s been a quiet backlash against the old mainstay of the agency review: the RFP.
“Fees offered by potential clients are too low; timelines for pitches too short; briefing documents (i.e. RFP’s) are too vague and many marketers overstep bounds by demanding that agencies relinquish ownership of their ideas to them,” writes Parekh in his AdAge article.
“Given the staff-cutting and other downsizing work agencies have had to do to stay afloat during the past few years, the traditional demands made by a prospective new client are falling on deaf ears,” said Meyst. “And clients should be careful not to get indignant about it – there are four important facts they need to keep in mind as they try to find the right agency for the right job at the right price for 2014.”
#1 Time is of the essence
Advertisers need to move now and move quickly to get their ideal list of agencies identified and pre-qualified.
#2 Objective criteria makes all the difference
You need to dive deep to find agencies with key skills that will make a difference to your business right away.
#3 Economic uncertainty works to the prepared advertiser’s advantage
Securing agency-client relationships early on will play an important part in any effort to “claim the strategic high ground” for the year.
#4 The advantages of an online database for reviews have never been more apparent.
“We’re able to identify a target list of pre-qualified agencies from our database in a matter of a day or two and have the first round of due diligence calls take place within a week of that,” explained Meyst.
AgencyFinder and its web sites agencyfinder.com and agencyfinder.eu offer a unique match-making process for pairing advertising, public relations and marketing agencies with advertisers.
Searching and invitation management is free to marketers and supported with complimentary search consulting advice (telephone and on-site consultations) provided by BPI’s executive staff. Advertising agencies and public relations firms pay annual registration fees to have their profile in the on-line database and eligible to participate in AgencyFinder-managed reviews.
Mike Bawden – Partner
Bawden & Lareau Public Relations, LLC
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