The Future of Agency Relationships


For years, most agency/client relationships developed into close, long-term partnerships. However, increasingly more these days, that’s just not the case.

According to Forbes, CMOs now view agency relationships differently. The Client/Agency Relationship Survey showed that 62 percent said that they now view their agencies as suppliers or vendors, not partners.

Also, due to the fact that many companies are now building in-house marketing teams, agencies are being asked to do short-term, one-off projects instead of acting as a long-term agency of record (AOR). Of course, this also plays into the vendor vs. partner relationship shift.

Marketers have also expressed consistent frustration with various aspects of traditional agency relationships. Although there are a number of things contributing to their dissatisfaction, two of the most common reasons are:

1. Lack of transparency about how their money is being used in relation to campaign spend and MoM results.

2. They were sold on a “full-service” marketing strategy with all the bells and whistles only to find out after the fact that the agency didn’t have the expertise or bandwidth to execute against it.

When agency relationships begin with unrealistic expectations, it only breeds distrust over time — and that distrust is compounded by the fact that clients already don’t feel involved with (or in control of) the process and execution of .

Key Takeaways

Although client-agency relationships are changing, the good news is that agencies can still increase revenue and close new business as long as they take a strategic approach to business development.

Here are four tips to get you started on the right path:

1. During contract negotiations, never promise deliverables your agency can’t do just to get the deal signed. Also, don’t just assume that your team will simply “handle it” or figure it out on their own.

2. As tempting as it may be, avoid pitching your agency as a “full-service” provider. The most successful agencies are those that differentiate themselves by specializing in one area of marketing or advertising.

3. Although “growing pains” are normal to a certain extent, make sure that you aren’t doing a disservice to your current clients or operational staff by prioritizing new business revenue growth above revenue growth from retention and referrals.

4. Remember: Just because a company has money to spend with you, doesn’t mean they are a good client fit for your agency. Clients that don’t fit with your agency’s culture will create more work for you and your agency than they’re worth. More often than not, they will end up costing you money, time, employees, and worst of all, the clients that you actually like.

Liz Farquhar

As former Content Strategist, Liz helped agencies create a repeatable new business process to support their agency growth goals.