Many years ago, my dad, also Paul, ran a successful advertising
agency. Gumbinner-North was the
twentieth largest agency in the world.
My dad had wonderful insights into the business. Once I had achieved some prominence in the
industry, he warned me that, and I am quoting, “Fees will be the death of the
agency business as we know it.” He
couldn’t have been more right.
One of the many issues with fees is that it puts clients in
charge of their own business. Part of
what agencies should be paid for is their objectivity. But with fees, clients have the last
word. One of the manifestations of this is
clients who insist on meeting candidates who will work on their account prior
to their being hired by the ad 
agency. (Or, worse, agencies who do it out of fear and volunteer
to have clients interview prospective hires for their accounts).
agency. (Or, worse, agencies who do it out of fear and volunteer
to have clients interview prospective hires for their accounts).
This is alarmingly common, especially with senior
executives, but I have seen account executives and account supervisors who have
been forced to meet with their prospective clients prior to being offered a job.
Some agencies have told me that this is a courtesy and the clients do
not have the right of approval. That is BS and unlikely - an agency is hardly going
to make the hire if, for some reason, the client does not like the potential
employee or has negative comments: “Oops, sorry, we are going to hire her/him anyway.” Wrong.
By having the client meet the potential employee prior to hire is giving he client tacit approval to control every action which the agency makes on the client's business, no matter how significant or trivial.
I can think of one instance where a group account director was interviewed
by a client. The interview went
well. But at the end of the interview,
the client called the agency and told them that since they were paying a fee,
they felt that they didn't need someone that senior running their business; they instructed the agency to find someone more junior. As appalling as this is, it actually
happened.
Gosh, dad, you were right.
Agencies are always in the best position to know who they
need and who will succeed. Presumably,
after interviewing multiple candidates and with much experience with the
client, they are in a position to determine the ideal staffing on their
accounts. This is not a shared responsibility.
By giving clients the ability to meet prospective candidates,
agencies not only lose their objectivity, but they end up in the difficult
position of being totally beholden to the client. What happens if the person
ends up being liked by the client but not by the agency? How do you tell your client that the person
is not doing a good job? The reverse is a lot easier: if the hire turns out to be a dud, it is a lot easier to tell the client who has not approved them that a mistake was made.
When an agency hires an executive at any level it should be
with total confidence, enthusiasm and absolute support. Clients should always know and trust that the agency has their best
interest at heart. Period.
When clients interview agency executives, it puts the client/agency
relationship in perspective; and not a good one, either.
"When an agency hires an executive at any level it should be with total confidence, enthusiasm and absolute support. Clients should always know and trust that the agency has their best interest at heart. Period."
ReplyDeleteCan this be taught in every MBA and marketing training program? Please?
Not only should it be part of all training programs, it should be part of agency/client contracts.
DeleteNot sure I understand the anecdote about the client who wanted a more junior account person on their business after meeting for introductions with a potential agency hire. If the client was already on a fixed fee arrangement with the agency, why should the seniority or experience of a candidate be an issue? The fee is the fee and the contract is the contract until such time as the client/agency compensation agreement is reviewed for an increase or decrease in the future (typically every 6-12 months, based on changes in staffing requirements, scope of services, brand budgets, etc.)
ReplyDeleteI would suggest that the real issue here and in most cases is casting and chemistry. Casting in terms of age, gender, appearance and manner. Chemistry in terms of likeability, personal style, and shared common interests. Kind of like a first date, where two people meet over drinks just to see if there’s a “connection” and any potential for “keeping company” together on a regular, if not daily, basis.
Years ago I was asked to meet with “the client” (a major CPG marketer) by a top global agency before being brought on board to head-up the account. At first I balked and said no, for all the reasons Paul Gumbinner has cited. I was prepared to walk away from the opportunity altogether.
But when the agency CEO explained that meeting was as much in my best interests as the client’s and agency’s, I changed my mind and took the lunch. After all, he said, wouldn’t it be better to know now if there was a “good fit” in terms of client endorsement and blessings, rather than finding out otherwise six months later that there was not – over things having nothing to do with my professional credentials or job performance.
Just some contrarian food for thought. Bill Crandall
@Bill: Thanks for your thoughts. The purpose of the anecdote was to show how mch control the agency lost when they they allowed the client to interview the candidate. I have no information about the fee arrangement. I was simply told, "after all, the client is paying for the service they receive so if they want a junior, so be it." You may remember the wonderful Donny Deutsch story about resigning Pfizer's Zyrtec rather than giving the client access to their payroll. I always applauded that strength.
DeleteAs for your meeting the client, I have heard the agency management point of view many times. Nevertheless, they were ceding control of the account to the client and, while it might have been somewhat beneficial to your relationship with your client, it is always a bad policy. The agency was operating out of fear that the client might not like you. If there had been a history of failed people running the account, I might understand it; but that tells me that there is/was something wrong with the way the agency screened and hired.
There was a history of senior-level "failed people" on the global multi-million dollar account I referenced, which surely explains the client's skittishness at a personal level. At the same time, I totally get and agree with your professional point of view ... in a "perfect world."
ReplyDeleteFor whatever it's worth, might also add that the client is always "in control". Unless it's a position for CEO, President, CCO or CSO, most agencies hire staff for "the client" - not the agency!
This was an interesting read Paul, I found your perspective really insightful. I think is a also a result of agencies taking their eyes of the ball, many today are everything but creative/strategic and seem to have lost the edge. Letting clients interview their assets is just another trick to justify retention.
ReplyDeleteUnwittingly, in an effort to cut costs, agencies are cutting corners when it comes to talent. Once you start doing that, work suffers and then I guess, its time to bring out the hat and the tricks.
But you're right, the ball's rolling now. I guess it's the end of the beginning or the beginning of the end, hopefully for just a few.
I think you got something right that I had not thought of. If the client pre-approves a candidate, the chances are better that the employee will last longer in the job and therefore save the agency money generated by turnover. Wish I had thought of that. Thanks.
DeleteThanks for your response Paul, Actually, I was implying that agencies have lost the respect they once commanded because of the declining quality of their creative output. And output has suffered because they are not spending to hire/retain good talent. Hence the other value adds top keep the client happy, like by letting them choose their employees.
ReplyDeleteSid: That is a really interesting perspective and I hadn't thought of it that way. Sadly, too many agencies operate out of fear which affects everything from the way they hire to the creative output. I hope that this spiral does not continue; perhaps as the economy improves, so will agency strength.
DeleteWhile there are certainly some clients who are looking to maintain or press their advantage through activities like pre-screening agency hires, others understand and value the benefits of strong partnership with their agencies and want to ensure a good fit. Ultimately, this is in the agency's benefit as well.
ReplyDeleteRelated to some of the points above, agencies have some very questionable hiring / promoting practices. Being burned by these practices can put a client in a position where they need to protect their interests.
Issues like this need to be evaluated on a case-by-case basis.
Dear PM: I honestly believe that a client should never interview an agency executive prior to his or her being hired. It is not indicative of partnership at all. In fact, it is just the opposite. Before being a recruiter, I ran an agency and I would never consider having my people meet the client first. It is the same with a lawyer: You have to trust them to judge who might be best for your business. If a client is burned, it is incumbent of the agency to determine the nature of the problem and insure that it does not happen again. If it happens more than once it is a safe bet that either the agency doesn't understand or that the client is wrong. Partnerships are built on trust.
DeletePaul, I just faced a curious reversal of this trend. I recently interviewed for a role on the client side. Not only did I interview with the extended internal team, I also was asked to interview with the agency VP on the account.
ReplyDeleteAlthough it was new to me, she seemed as though it was standard procedure for them.
For better or worse, I did not land the role and received no meaningful feedback, so I have no clue what, if any, impact the agency rep had in the decision making process.
Richard: Funny, but I have this going on right now with a client side marketing job. As it was explained to me by the client, the agency is a true strategic partner and the person running the account (and the agency)is in a good position to evaluate the strategic prowess of the candidate.
DeleteI think in this case, they really are partners - but that is rarely the case the other way around.
I did a post some time ago about not getting feedback. It is just plain rude.
Fantastic article. Must be bookmarked:)
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