The top benefits derived from a formal agency evaluation process, says the report, are identifying and improving under-performing agency relationships (92%) and identifying and recognizing high-performing agency relationships (85%),.
Qualitative performance criteria carry much more weight in agency performance evaluations than do quantitative communications criteria (e.g., media cost savings, media buying goals) or business metrics (e.g., sales, share).
Some of the specific qualitative performance criteria commonly used in agency evaluations include:
59% of firms conduct two-way, or 360-degree, evaluations in which the agency also evaluates the client. Additionally, 13% of marketers identified a new practice in which the evaluation processes allows for their respective agencies to evaluate one another.
58% of marketers rate agency performance evaluation as "extremely" or "very effective" in maintaining the client-agency relationship, and 38% rate their agencies "somewhat effective." Only 3% rated their programs as "not too effective" or "not at all effective."
Bob Liodice, president and CEO of the ANA, says "Having a formal agency evaluation process is... more imperative at a time of heightened focus on marketing accountability... this will productively support collaborative integrated marketing and brand building strategies in the long run."
Best practices that were identified from the survey include:
76% of marketers report that their firms have a formal evaluative process in place for their traditional creative ad agencies. Other agencies most likely to be subject to an evaluation are:
In general, formal evaluations are conducted annually by about two-thirds of the firms while about one-third evaluate their agencies more frequently than annually.
For more about the ANA and this study, please visit here.