Unfair pitch process is hurting ad agencies

Kahn-webThe peculiarities of the pitch process in the Middle East are damaging the region’s advertising industry, according to the chief executive of Dubai-based Water Brand Group.

In an essay published in the latest edition of Campaign, Bob Kahn calls for an overhaul of accepted pitch practices which allow clients to make unfair demands of agencies.

The former managing director of Ogilvy & Mather in New York writes: “The RFP (Request for Proposal) process, which is used all over the world, was introduced to achieve fairness and price competitiveness but unfortunately it has become misused by many clients in this  market to extract unreasonable demands from agencies and often compel them to deliver free work to clients without legal restrictions.”

Kahn complains that typical briefs are poorly prepared and  ask for extensive campaign plans to be submitted within unrealistic deadlines – and without any opportunity to discuss these with the ultimate decision-maker. Furthermore, the requirement for such detailed submissions strips the winning agency of bargaining power when it comes to agreeing fees, he says.

Kahn wants clients to meet each agency individually to present their brief, pay each agency a fee to develop creative concepts which stay in the ownership of the agency until a formal agreement is signed and select a shortlist of no more than three agencies.

The imbalance of power in the pitching process has long been a cause for complaint but is likely to worsen in the current economic conditions. The chief executive of Procter & Gamble recently described the emergence of “a buyer’s market” in the global advertising industry and this is a sad fact of life for agencies. Perhaps Kahn’s remarks are therefore more timely than ever before. However, the likelihood of overhauling such long-established practices in the Middle East seems remote.

Advertisements

3 Responses to Unfair pitch process is hurting ad agencies

  1. nickcampaignme says:

    Replies to our Twitter posting suggest that PR and events agencies are facing the same struggles with pitching in the Middle East.

  2. Sadly, poorly prepared briefs and unrealistic deadlines are typical of many communications briefs in this region, regardless of the discipline involved. Far too frequently, the client’s planning process only receives senior management attention AFTER agencies have responded to the RFP. Whilst RFP responses can prompt useful revisions to client objectives, requirements and budgets, these can be drastic and sometimes agencies only find out what the brief ‘should have’ been after having gone through an extensive pitch process.

    I’ve seen too many pitches where the client has decided to change all the criteria for awarding its business after closing its RFP and many also where the contradictions between the RFP and reality kill the agency selection process off completely, wasting everyone’s time and effort. Sometimes this reflects a lack of knowledge in the marketing function, sometimes it’s lack of senior management buy-in and, worst case, it can stem from an internal decision to leave any serious discussion until after receiving all the agencies pitch ideas.

    I’m not going to detail here what the ideal agency selection process should look like, but companies do get out of agency pitches what they put into them and if companies are serious about their marketing then they need to take their agency selection process seriously, and at a senior level.

  3. Tom Roychoudhury says:

    The pitch process has become a bit of a conundrum in our region – particularly here in the UAE. I couldn’t agree with Kahn more. His proposals seem right on song, except that in this buyer’s market, agencies are at ransom – the pitch is a must do in these desperate times, and I feel a lot of this is being exploited.

    How many times have we pitched, only to see the ‘rejected creative’ show up in the client’s marketing efforts down the line. How unethical is that. Such malpractice should be open for immediate and serious litigation – with results that set standards and draws the line for good.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: