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Q1 planning should include agency performance measurement

David Sitton, Consultant at The Observatory International, explains why it matters.

One of the first tasks for Marketers in the new year should be performance measurement evaluations to look back at recent past performance. This will show where and how well their teams performed and what is needed to improve or adapt quickly during these turbulent times.

Shining a light on what has happened and understanding which of their agencies truly stepped up to the plate in the most testing of conditions – and which did not – will help set the agenda for the year ahead.

Such metrics are a hugely important not least because they can help build a strong relationship between marketer and agency. Surprisingly the research we conducted among ISBA members recently indicated that 15-20% of advertisers do not carry out such work.

That’s a huge mistake because, done well, performance measurement sustains relationships by quickly identifying issues and enabling them to be dealt with. Ongoing tracking of trends also provides learnings from past mistakes leading to a more productive and constructive relationship.

Not only that, but it also helps brands improve the output of their partnerships. Giving agencies a voice through the same evaluation channels the client uses promotes a culture of openness and fairness and provides an opportunity to look from the outside in.

Agency assessment can also highlight operational and behavioural issues that may be imperceptible to those inside the loop. And by conducting such assessments across the whole roster, marketers can discover if the issue is just with one agency or if it’s endemic in their current ways of working.

The best performance measurement also helps agencies feel part of the team, transitioning suppliers into partners that are trusted advisers to your business. Agencies see this process as a commitment to the relationship because it promotes a culture of honesty and integrity and increases trust, transparency and collaboration.

Consistent and regular measurement enables performance to be tracked over time as well as generating reliable, robust and unbiased data to inform ‘payment by results’ mechanisms. Ideally measurement should take place bi-annually and, where closer monitoring is required, quarterly.

Just as in any area, however, there are ways of doing this well and ways of doing it less well. The five key principles of world class performance measurement are:

Alignment: Ensure Marketing and Procurement are aligned on the purpose and process of the evaluation and have a performance measurement champion at a senior level to provide credibility to ensure the programme is aligned with business goals and objectives.

Independence: Independently managed evaluation processes, managed by a third party, generates unbiased reporting and a neutral line of communication between client and agency. This reinforces impartiality, instils best practice and can provide benchmark and reference scores from similar clients and sectors.

It must be two-way: It’s not about seniority. Holistic feedback from everyone is valuable – especially from those who are most involved. Providing a structured process enables feedback to be collected in an organised way and helps team members feel valued. Marketers must also commit to follow-up sessions to discuss feedback.

Commitment to change: To be impactful, evaluations must be more than just a monitoring device, advertisers need to develop action plans with responsibilities assigned and timings for resolutions agreed. Participants will quickly lose motivation to complete the evaluations if they see nothing happening as a result of their input.

Keep it simple: Don’t ask unnecessary questions but have a consistent and purposeful questions set and keep evaluation surveys as short as possible to encourage a good response rate. Clients and agencies have a day job to do, therefore it is important to keep fatigue low and evaluation surveys short.

So, when you prioritise your to-do list, keep performance measurement high on the agenda and keep a finger on the performance pulse.

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