Tag Archives: creative agency

WEIGHING OPTIONS: Billing For What We’re Worth

A Sense of Worth

Ages ago, I wrote a blog called, “Trumpet Over The Horizon.” That article dealt with my sincere belief that clients want agencies to charge realistic, with prices for services. I propose to know clients a capped mount for creative services (i.e. creative director, art director, copywriting fees, etc.) . The primary fee would be joined from generating and placement of ads, an amount not excessive of than 12%. By tradition, agencies are paid 15% of place ads idea was for the 3% differential to replace back into advertising. I wanted to benefit the client.

Here is the major problem with my former hypothesis: Advertising agencies put up with more than crap than people outside of agencies know. Accounts can be a headache simply because a client is demanding. So it doesn’t matter what I discount because it’s never enough to please. The resolution for me is to bill for the work that we do at the prevailing rates. It may sound expensive, but that’s the way it is. We are a creative agency, we are very good at we do, and we want to do it pay for it.

Take a look at what is happening nationwide. In New York City, where things are admittedly higher, senior digital executives bill clients an average approximating $350 an hour. Conservatively, creators performing similar work at traditional agencies on Madison Avenue bill at $700 per hour. Where based in Los Angeles, and things in Adland is no different. We worked our asses off and quite frankly, when clients refused to acknowledge what we are doing what is to enhance their business, it rankles.

I’m not making this up. A 109-page report published by the authoritative 4A’s reflected contains a list of the most agencies of all sizes in 2011. These figures regarding hourly rates billed by agencies is published the report. The survey is an update of a labor-billing study conducted three years ago. The report collected data from positions such as account management, creative, analytics, digital, media services and talent management. Having been reported I noticed that Los Angeles and New York, and not to disparate in charges. The Midwest probably is more, but not by much. I think the point is that we work hard for what we do. Agencies of all sizes are filled with people who are immensely talented in advertising and public relations. Our brains are taxed, we often work past out boundaries of times and learning to give the best possible product to a client. Clients should be appreciative of that – often they aren’t.

Let me give you an example. Perhaps this is hypothetical. An agency is contacted by a startup company. The client company wants logos, graphics, web content written, brochures, and other collaterals, in addition to the development and placement of ads in newspapers and magazines for its products.  To me this is a full marketing plan, and I told him so. Before, we proceeded with the work, and after three clients meetings of three hours duration, I drafted a letter of intent. The letter of intent denotes my agencies obligations to the client. It is an offer and acceptance at common law. Most people understand this. This client wanted us to partake in emergency work that would’ve taken up more than twenty hours using a team of five. I told this client as tactful as possible that they had not acknowledged the letter of intent. I cautioned them that if we did as they asked, our agency would have engaged in substantial performance – enforceable contractually. This client counter proposed essentially saying that they reserved right to pay us only if satisfied with our work. Payment would be ninety days later. And, assuming that they retained us as their agency, our monthly fee would be paid ninety days after it became due.

Quite honestly, I’m not unfamiliar with clients who have abusive, bullying, attitudes, but this joker took the brass ring. We received letters from him wherein he changed the company’s plans, blaming us for the changes in rejecting the cursive work we did for them. I did not laugh because this was not funny, but a little sad.

Clients like this should be billed for the full amount of services provided. I’m not afraid to do this because as a matter of principle.

 Here is the upshot. Someone performing work under a contract can invoke the common law rule of substantial performance and charge for the reasonable value of your services or, “quantum merit.” I acted as a creative director on the client projects. My billing rate is no different than that digital creative in New York, or $300 per hour. My art director and graphics department bills at $160 an hour, and my copywriters bill at $150 an hour. Multiply that times 20 and you have sticker shock. But that is the nature of the business – we deserve every cent we charge. 

The new reality is a second sound of the trumpet over the horizon. Billing for what we are worth because we have mouth’s to feed. There is a controversy in the industry. Small agencies like mine tend to forgo billing. The larger agencies, not as reticent, you get stuck like a crazed vampire.

As an agency head, o must protect my stake in my business. Treat everyone fairly, do a great job, but expect the same to done for you. Some people neglect these principles, and issues develop.

Benchmarks are in place for a reason. Agencies often are treated worse than the maid working for the “help.” I do not pay myself $300 an hour. But the benchmark is equivalent, not only to the suggested retail price, but to our sense of worth. I don’t know it is going to be a backlash, but I know what we are worth. We are agency and will start acting like one, because billing is value based.

Bernard A McNealy, President/CEO

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WEIGHING OPTIONS: Avoiding the Ticket to Obscurity

I took a few months off from blog writing. I thought expressing the creative focus of Carson Dunn Media had become a task best left to others. The future will determine the wisdom of this, but suffice to say, I am back.

 In my hiatus a wonderful writer and former art director of Carson Dunn Media, Kimberly Bautista took my place. As usual, Kim wrote with cogency and communicative skill.

 My intent is to speak to issues relative to marketing, public relations & advertising; the wisdom of hiring an agency if you are involved in either. I am biased – a client cannot do what we do with the efficiency and skill necessary to promote them to profitability. Creative agencies tend to be a revolving door that remains open. It is my fondest hope that our most talented colleagues will always remain allied with CDM. It makes sense because if we are to achieve our destiny, those men and women helped paved the way.

 Thanks Kim.

 Let me share something about how people go about the effort to promote themselves on their own, they make often career ending mistakes. The test is on the welcome page of our current website, but let me retell the story here.

“The big billboards had been around for years, mainly in Hollywood.  On it, the face and impressive torso of a woman were displayed. Time revealed that she wanted to be a movie star.  Intuition told her that the public and ultimately studio moguls would be drawn to her. Calls and fame would follow. Neither happened. At great expense the billboards were taken down, and then put up again. Still, there were no calls. 

 Her efforts lacked the basics of promotion.

She never consulted anyone, or really targeted her audience. The ads only bore her first name, but no information of her background and talents. Not surprisingly she did never did anything significant.  Misunderstandings public relations and advertising got her two things:  an identity as the woman with the huge breasts; and, a ticket to obscurity.

Public relations and advertising are more than notoriety. Employing the most effective avenue to reach receptive consumers equate to success.  Carson Dunn Media will insure that a client avoids becoming the person on the big billboard.”

 That’s it. It isn’t funny, just ironic and sad. I cannot speak for any other agency but I have a gentle warning to our potential customers. Do not engage in marketing, PR, or advertising without knowing the terrain. Promotion is Carson Dunn Media’s métier. Whether it is broadcast, print, online ads, Twitter and or Facebook campaigns, CDM strives to be thorough beyond expectation. It is what we do – and very well at that.

Sometimes avoiding fading to obscurity and losing a dream comes about because a person just does not want to pay a fee for professional guidance.

 Bernard A. McNealy, President

 

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WEIGHING OPTIONS: When Clients Don’t Sign.

A client contacted us and after much discussion via telephonic conferencing, my agency was asked to provide a proposal – to justify what we assumed was the start of a long term creative agency/client relationship. We were hired! I thought. I ran around the balance of the day jumping up and down and patting myself on the back. (I pulled several muscles in process.)

So much for putting an optimistic spin on something. They would not sign. We tapped our budget to come up with a professional proposal — complete with visuals.  But, this was a classic case situation where the client wouldn’t sign.

This client wanted a full array of services ranging from marketing consultation, research, media buying, creative work, all in pursuit of our developing an effective campaign to brand for them. Here was the problem, the thing that prevented us from being hired by this client. They had a marketing unit headed by a company principal. Apparently our offer which included a marketing plan created a sense of territorial infringement.

Territorial infringement is the problem with most client-agency relationships. This company really did not have a staff dedicated to doing advertising work. They didn’t know the nuances of developing a campaign – but yet our work was viewed as conflicting with the marketing department. I wanted to scream: “Hey! We know how to brand you! We know where your customer base is! We have the know how – you don’t!”  My emails and phone calls eventually went from stridency to beseeching. Like all business, I wanted the account.

I decided on  another path: explain the advantage of hiring an agency as opposed to doing it themselves. This client company was a growing business.  Since most business owners are swamped running their business, that alone prevents them from conceptualizing, creating and ultimately implementing a campaign to grow the business.  Ad campaigns are not improvisation. They require time, energy and insight that comes with being an outsider.   An agency frees a company’s staff to do what they have been trained for. So, an agency is merely an extension to a marketing unit.

Would we have done a creditable job? Of course. A creative agency makes its revenue by working closely with and for a client. Agencies can benefit any size business, but they have to have a clue about the benefits of advertising, PR and other forms of promotional communication. We can access resources a marketing department doesn’t have. Plus, the more creative people are at agencies.

Even for an experienced company, developing a brand can be a complex undertaking. Advertising, public relations and creative agencies help this process by using its expertise to develop brand awareness. We also target the most effective market. Agencies can also promote a business by lobbying individual media to get the most cost effective advertising in each market.

Well, explaining all of this or even a part is exhausting. We are a small shop. A small shop can  specialize in one particular area of expertise, such as online advertising, or go big. We have to be talented and versatile. Was this company was afraid of taking us on? No. New horizons make one hesitant to proceed. That’s the nature of being a human being.

Bernard A. McNealy, President

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