Cost saving ideas that won’t hinder your growth or damage your agency relationships

Christine Downton - Observatory International

Christine Downton Managing Partner, London March 22, 2023

We know there is a lot of pressure on budgets and everyone is tasked with finding cost savings.

That’s why we’ve got a few cost saving thought-starters for you that won’t hinder long-term business growth or have a detrimental impact on your agency relationships.

Agency fee bench marking and resource optimisation– whilst most do this as part of a pitch or as part of an incumbent agency review, it’s never been more important to identify inefficiencies and any abnormalities in rates/staffing.
Roster rationalisation– agency rosters can become bloated over time, resulting in significant wastage and cost penalties through duplication of effort, right through to the required back-office support to handle purchase orders and invoicing. Rationalising the roster and providing a framework for marketers to reduce reliance on multiple agencies overcomes these inefficiencies.
Fixing rather than pitching– Whilst you may have concerns that your agencies are not delivering at 100%, changing agencies can be an immense distraction. Add to that the loss of institutional knowledge and the time it takes for the new agency to understand your business and you can see why identifying what the issues are with an existing agency and fixing those might be a better option.
Avoiding the hidden costs of pitching– eespite our view that it’s better to fix than pitch there are times when it is necessary. But beware the hidden costs of pitching. Agencies who have to pay intermediaries ‘win fees’ or subscriptions will inevitably ‘claw’ back these costs from your budget over time, and those who won’t pay them may not be included in your pitch at all. The Observatory International takes no form of payments from agencies.
Agency contract compliance– often done at specific milestones like the end of a major campaign or shoot, there is enormous benefit in conducting an audit more systematically and regularly to provide cost transparency and unearth hidden inefficiencies, especially from any ‘out-going’ agencies.
Better briefing and frictionless ways of working– poor briefing and inefficient communications development is consistently one of the greatest areas of inefficiency we see within communications teams. It’s very tempting to cut back on training during periods of cost cutting but that will just compound the issues of lack of mentoring and development many marketers experienced during the pandemic. Instilling best practice will pay benefits now and over the long-term.
Reduced asset creation/wastage in the consumer journey– reviewing the communications development process to focus on need and quality rather than quantity. This includes being clear what can be created globally or regionally and what needs to be nuanced locally. Not only does this have cost benefits but it also helps to support the sustainability agenda by avoiding waste.