My blog is about exchanging ideas and best practices on all things marketing and communications related. I'm interested in your thoughts, feedback, additions, arguments and point of view.

Monday, August 20, 2007

Using up all your agency hours before the project is done. What a buzz kill.

Right now, you’re thinking back to that moment. It was 2 months ago and you were sitting in the agency’s boardroom, listening to the creative team present concepts for the new product launch this fall. The ideas were excellent –any one of them could deliver the results you need. Your boss is smiling… everyone is taking lots of notes. You can’t wait to tuck a sample copy into your portfolio.

Cut to this morning – you’ve been in the throes of production for the better part of summer. It’s consisted mostly of eating lunch at your desk and steering through endless conversations. You’re ready to sign off the boards when you get the call – the agency has logged way more production hours than anticipated – and the account director is asking for more money. How did this happen? How did we get here? What a buzz kill.

Project fees are an effective way to manage costs. From a client`s perspective, fees are a good way to manage project costs. Agencies provide an estimate that summarizes the number of hours by department (creative, account services, production studio, etc.) that it thinks is required to produce the concept and generate a measure of profit. However until you get into the project details, it`s just that – an estimate, subject to change.

So how do hours get out of control?

I`ve seen product managers stop at nothing to ensure their work is 100% tight and locked down. All the pieces must harmonize together. Every copy point spoken aloud to ensure key messages roll off the tongue. Layouts are scrutinized and colour choices re-evaluated. It has to be perfect. And this manic commitment usually results in a total disregard for the number of hours the agency estimated to get your job done.

Set the ground rules up front - what do I get for my money? In my experience, in order for the fee model to work, ground rules need to be clearly established about service levels up front – before the first boards are marched down to production. Here are some of my best practice points to ponder:

1. Establish how many rounds of revisions are included in the estimate. Make sure it’s spelled out in writing and communicated to everyone on the team. It’s also helpful to give a distinct name to each round. For example:

Round 1 – Copy Deck Approval
Round 2 – Initial Layout Stage
Round 3 – Working Art Design
Round 4 – Final Art / Lock

Knowing you have a finite number of chances to review the work has a way of ensuring close scrutiny at every round. And sign off the boards after each approval stage.

2. Make sure the copy deck is approved by all stakeholders before layouts begin. I guarantee revising copy after it’s been laid out is the fastest way to burn through agency hours.

3. Typos and mistakes a client finds, or layouts judged sloppy and requiring additional studio time should not be logged against the estimate.
A client who feels like the agency proof reader is a relationship irritant that can lead to a conversation about “value for money.”

4. Have a ‘did well / do better’ chat with the agency at the project’s completion. It’s a useful way to acknowledge exceptional work and identify process areas that can be improved next time round.

5. Deal with issues as they arise today.
Don't put off a conversation like project hours and profitability - it could damage the relationship long term. And nothing pulls oxygen out of a room faster than a discussion about the past. Always be current and future focused in discussions with the account team.

If you add a few of these techniques to your next project, I can`t guarantee you`ll never have one of those conversations with your agency. But when they do call, more likely than not it will be about making lunch plans.

Yahoo! take a bow!
Thomas Claburn from InformationWeek reported recently that Yahoo! has reason to smile: the company took the top spot in the University of Michigan's American Customer Satisfaction Index (ACSI) report on e-business Web sites. Yahoo gained four points to reach 79 on the ACSI's 100 point scale. In a written analysis of the study, Larry Freed, President and CEO of online satisfaction management company ForeSee Results, observed that the report's results bode well for Yahoo's bid to improve its profitability. "Yahoo is emerging as the leading portal, fighting Google for the search business. Wahoo!

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