If you are selecting a creative agency to work with the likelihood is you are busy organising your own agency beauty parade.
You select the best looking agencies and invite them to come up and see you sometime. They sashay in and flaunt their best work and ideas before you crown your favourite with a contract.
And, of course, you pay nothing for the show.
The potential gains for the agencies are significant, but have you ever stopped to think about the hidden costs that may be involved in the free pitch? More pointedly, have you ever wondered who actually covers these hidden costs.
In life, they say, there is no such thing as a free lunch. In business there is also no such thing as a free pitch.
Here’s some food for thought before you get those agencies to put out a particularly lavish spread for your next project.
1. Hidden costs
Exactly what are these hidden costs of the agency pitch?
Well, this varies from industry to industry, client to client and sector to sector. However, the PR association, PRCA, estimated that about 20 hours was typically spent on a new business pitch. Extrapolating from this it conservatively estimated that as much as £50,000 to be the annual hidden pitching cost for each agency.
Whilst web development and design costs are not in this league, this scale of hidden cost is certainly worth bearing in mind when you go to call in the contestants for your next beauty parade.
2. The best minds of our generation
Certainly pitching tends to occupy the best minds of a business – how else can we put our best foot forward and present our best face?
It is inevitably the existing clients who must shoulder the brunt of this diversion of talent.
3. New business disrupts
New business pitching can be a time consuming, frustrating and often disappointing ritual.
There – I’ve said it!
That free work that is being asked for has to be paid for by someone, and those creative ideas you are expecting to get are not born in a vacuum.
The truth is that free pitches have costs that must be met somewhere – and the only real place to meet these is from existing customers.
This is something that is rarely explicitly spelt out.
It is the clients who ultimately must pay for all these free pitches, unless agencies go the not-for-profit route!
Every agency, of course, must marry up the potential benefits of new business with the demands it places on its time.
It is, however, worth considering that agencies are not like the stock market. There is always past performance that can accurately guide you to future returns.
Checking out the portfolio, chatting to current clients and meeting face-to-face with the agency may help you whittle down your long list to a much shorter one.
And you’ll be saving everyone a lot of time and money.