FUEL LINES Fueling Ad Agency New Business Through Social Media

If want to know what irks CMOs the most about ad agencies the recently released Gerson Lehrman Group, GLG Councils Report —“Closing the CMO / Agency Gap: How Agencies Can Win Business and Build Stronger Client Relationships,” provides some excellent insight.

This report is based on a survey of more than 80 senior marketing executives. It analyzes the disconnect between client expectations and the performance of marketing services agencies.

This study was designed to help agencies better understand how marketing executives view their agency relationships and how they make decisions on engaging an agency.

The relationship between agencies and their corporate clients is more important now than ever before and needs fixing. As Founder of The CMO Club, I constantly hear from CMOs in the club about their challenges and concerns, particularly regarding the gaps in their agency relationships.

Right now, there is a considerable gap between the service CMOs receive from marketing services agencies, and the service they expect and need from them.

Pete Krainik, Founder of The CMO Club and Member of the GLG Councils

Insight: What about their current ad agency irks CMOs the most?

• More than half (51%) of the respondents reported that agencies did not have sufficient industry knowledge and clients felt their agencies had not conducted sufficient research.

Insight: Research on a prospective client’s market AND business strategy is critical.

• 79% of respondents said they decided against hiring an agency because of issues related to the agency’s understanding of their business, market, or how they could add value to that business.
• 91% of respondents listed the above three factors as the most important components for making a decision about engaging a particular agency.

Insight: CMOs want agencies that do their homework, even once business is won.

• 49% of respondents expected a marketing agency to invest at least 20 hours of research into their industry, business strategy, and product prior to a pitch.
• 88% of respondents stated that agency understanding of their industries and business was either “critically important” or “very important.”
• 52% of respondents reported the most frustrating aspect of their agency relationships was a “lack of industry or street knowledge” or “not sufficient diligence in campaign” development. When asked what frustrated them most about their experiences with agencies, they report, “agencies not willing to do their homework – proposing cookie-cutter solutions,” and that agencies need to have a “[g]ood understanding of the technology and positioning.”

Insight: Agencies get passed over by marketing executives for three primary reasons:

1. Marketing executives strongly indicated they were either not convinced of the value of what the agencies were offering (34%)
2. They were concerned the vendors did not have sufficient market insight (26%).
3. The third ranked reason agencies were not chosen, “not understanding needs” (19%).

Insight: Gap between client expectations and agency services

Clients are dissatisfied with the level of business and market knowledge that agencies possess, both during the pitch process and throughout the relationship. A significant gap exists between what marketing executives expect and what agencies offer. The gap is caused primarily by inadequate research on client strategy and market.

Developing and demonstrating this knowledge is key for agencies that want to secure new business and maintain a strong existing relationship with their clients. Social media provides a great opportunity to both develop and demonstrate your agency’s knowledge to targeted prospective clients.

Click Here – to download the full report