In today’s world we all need to be innovators …
Last week the SVP, Growth at MediaMonks shared an article over LinkedIn (Stop paying agencies for their time and start paying for their output) with the observation MediaMonks don’t use timesheets “they accept the risk of pricing based on outputs, knowing that if they get it wrong, they’ll apply the learnings next time.”
- By Caroline Johnson
- October 20, 2020
Last week the SVP, Growth at MediaMonks shared an article over LinkedIn (Stop paying agencies for their time and start paying for their output) with the observation MediaMonks don’t use timesheets “they accept the risk of pricing based on outputs, knowing that if they get it wrong, they’ll apply the learnings next time.”
What struck a chord wasn’t the article or timesheet comment itself, after more than a decade of working alongside agencies, deliverable based pricing and the reasoning behind it is nothing new. It was the sense of advocacy from the LinkedIn community at large in response to the post:
“been preaching this to agencies (and brands for decades)”
“100% do the right thing for the client and they will do the right thing for you”
“never believed in timesheets.”
“all the yeses here”
Why are current tools and processes failing?
To give a little context. In 2009 I joined Sohnar, the creators of the award-winning Traffic & TrafficLIVE products. We built a reputation based on innovation and we followed a simple principle: make easy-to-use software that is a pleasure to use. Put the customer first and deliver on your promises. We understood agencies and knew how to deliver what they needed.
One thing that was evident even back then was that multiple shifts were taking place. The first related to trust and transparency within the media and marketing industry, it was heading toward an all-time low.
The second was in regard to the pricing and estimating methodology itself. How, despite timesheets being diligently done (JWT Brazil went so far as to connect their beer fridge to their time sheet solution, until all staff had them completed the beer fridge remained locked!) were issues still hitting the bottom line: scope creep, over-servicing, unbillable hours, non-profitable retainers, the list went on?
Are agencies focusing on the wrong thing?
It begged the question, what is the end goal of the agency? Is it, accurate timesheets or to deliver a final product to the client? A product based on a fair cost to the agency and a transparent price to their client.
Secondly, if, despite using project/task management solutions and recording those timesheets so diligently the issues relating to pricing, profit, trust and transparency were still so prevalent what was the missing piece of the puzzle?
Looking to 2020 it has been many things, including some positives. Not least the removal of commuter related stress and the associated cost savings, then there was the unexpected bonus of meeting your colleagues’ children and pets over Zoom!
Arguably though, the biggest positive came in the form of workplace trust. There has been a seismic shift, trust has (for the most part) been fast tracked and genuinely realised on a global scale in the workplace in ways none of us could have predicted as we rang in the New Year.
This brings us full circle back to the issue of agency pricing.
…It exists because members want to rid the profession of bad practice and reduce the number of opportunities for negative articles about the discipline.
In July of this year McKinsey & Company noted (Pricing through the pandemic: getting ready for recovery) that pricing was a crucial part of an organization’s rapid revenue recovery strategy.
As many in the industry know, Project Spring, a WFA (World Federation of Advertisers) Global Sourcing Initiative launched in 2018, was designed to transform the value proposition of marketing procurement. It is by their own admission ambitious, bold and very necessary.
It exists because members want to rid the profession of bad practice and reduce the number of opportunities for negative articles about the discipline.
David Wheldon, CMO RBS (retired 2020) “procurement has often been blamed for driving costs down and this when dealing with agencies has been a one-way traffic system where the pain is taken by agencies, but the gain entirely goes to the client. The role of marketing procurement is to ensure that value is delivered for the client company and for the agency partner”.
It feels both exciting and timely on the back of these events and this journey to join The Virtù Group, once again with the founder of Sohnar at the helm.
This is an opportunity for us, based on a combination of our previous experience, and the changes in the economic landscape to help agencies again.
An innovative tool is leading the way
The Virtù Group is home to Scope.
Scope is the SaaS tool for agencies and brands which is revolutionising the job planning and scoping process using artificial intelligence.
We know from our extensive data analysis that the place agencies lose the most money is during the estimating process (on average 12-23%). This is where our solution Scope comes into play.
With access to anonymised live data from over 7 million projects from over 800+ agencies across the globe, Scope allows you to be more accurate and consistent on pricing than ever before.
Scope enables you to halve your non-billable planning time and track, analyse and manage what you’re selling.
Scope manages clients across multiple sites and/or that have complex partner structures. Collaborate across global networks, streamline job planning and protect the integrity of your budgets.
Scope is for agencies and advertisers.
We are looking once again to change the industry for the better. Scope Better.
Keep Reading :
The Top three reasons I moved from agency life to a tech SaaS platform. And why you should consider it now too.
“…I bring a unique skill set, a different perspective, industry experience, passion and the belief
Rolling out a new system in your agency? Make it a shared implementation.
At Scope we trust in a shared implementation methodology. This is why. Having worked for a few tech businesses, the first back in 2005 and more recently, fast forward 15 years, to working at Scope
Oliver’s Jason Bailis in a fireside chat with our CEO Tracey Shirtcliff
Jason talking to us about the value of Scope’s deliverable-based benchmark data to Oliver.
Scope is 4 years in the making. It’s based on the number one premise that Excel and Word are not tools to manage global scope of work. That there is a better way. Armed with the want of a better way and driving a better more joined up process between advertisers and agencies- Scope was born.
