The American Association of Advertising Agencies just released an "Agency Review Participation Agreement," to help address a number of advertising agency "pain points" when participating in an agency review being conducted directly by a marketer, without the services of an agency search consultant.
According to the 4As, the Participation Agreement is designed to help an advertising agency determine whether a prospect would be a good client for the agency. The 4As explained, "This Participation Agreement clarifies the agency’s expectations that the review will be conducted in a respectful, professional manner. It can help agencies engage in a productive conversation with a marketer prior to committing the time and resources to participate in a review."
The Participation Agreement includes nine key principles:
- Communication is key -- The Participation Agreement emphasizes the importance of open communication, including during the agency review process.
- Clearly defined budget and expectations -- It's important to understand up front what the budget is, what the advertiser is hoping to achieve, and how success will be measured.
- Internal alignment -- Advertiser representatives involved in the agency selection process should be aligned on the marketing goals and expectations for the agency.
- Process and timing -- The advertiser should share the process and timeline with the agency and provide as much advance notice as possible if there will be changes.
- Confidentiality of material and data submitted -- The parties should execute a mutual non-disclosure agreement, so that each party's confidential information is kept confidential.
- Speculative work -- Noting that a lot has been written about the pros and cons of spec work being required during an agency review process, the Agreement indicates that, "We don’t believe that it is necessarily the best way to determine whether an agency will be a partner for you." If spec work is going to be required, there needs to be an agreement about that, but that, otherwise, the agency expects to retain ownership of its intellectual property.
- Payment terms -- If the advertiser does engage the agency, the agency expects to be paid within 30 to 60 days after receipt of invoice, except that earlier payment may be required in some situations in order to meet vendor payment deadlines.
- Timely notification and actionable feedback -- Once the advertiser has made a decision about the search, it should promptly let the agency know. If the agency is not selected, the advertiser should provide "candid feedback."
- Public commentary -- The parties should discuss whether the agency review process will be kept confidential.
Using this agreement, the 4As says, "can help agencies engage in a productive conversation with a marketer prior to committing the time and resources to participate in a review."
"This Participation Agreement clarifies the agency’s expectations that the review will be conducted in a respectful, professional manner"