Why giving an agency a budget could save your marketing

It’s an age old problem, and one that’s encountered all too frequently. An agency battles through the credentials and creative pitch, finally wins it and asks the simplest of questions. “What’s the budget?”.
It should be a simple question, but so often is answered with a “we don’t know” or a “what do you think it will cost”.

There are usually two reasons for this. The first is that the client doesn’t actually have any idea what the job SHOULD cost. This is worrying because it's always useful if a client has been able to do some research.  It makes a lot of sense to get some foundation and understanding of what a job will end up costing.  It tends to prevent heated debates along the lines of “we never knew it would cost so much!” Not a great start to a potentially long relationship…

The second reason boils down to a question of trust. The client feels that if they let on how much they have to spend the agency will always match it or try for something a bit bigger. Why tell them how much you have to spend if they can do it for cheaper. This sort of “drive them down” mentality has several flaws, and is often the reason for projects going sideways. For a start, any decent agency will always work to the client’s budget, whatever it is. That’s the point of a budget. The problem, especially with larger, more complex projects, is that the variables are so considerable that without a clear idea of the clients monetary restraints the agency can rarely produce a good solution. We’ve had projects that could have cost the client thousands and managed to come up with an equally effective solution for a few hundred pounds – the important thing was the client told us what the problem was, and how much they had to throw at it. It’s the agencies job to take these variables and come up with a solution that works.

If you imagine going shopping for someone else, with a “very tight budget” but now idea how much that actually was. What items would you buy? What if you buy something you think will be cheap, only to find out it’s several times what you thought it would be. Wouldn’t you just buy everything on the cheap as the expense of quality? A good creative agency takes your shopping list and goes out to find the best combination of items to fit your budget – a difficult task if it has no idea what you want to spend.

It’s hard for the client too – too many times they get bitten on cost by a less than reputable agency, or an agency tries their luck depending on what they feel the client has to spend. But that problem’s easily fixed by choosing the right one. There are equally plenty of agencies out there who work their socks off just to make sure the client gets what they want, and are happy to lose a bit along the way to make sure they get it right. The best way of establishing this is to chat with the agencies current clients. Ignore the testimonials on the site – they’re not going to put anything bad on their, instead ask for a few contacts who would be happy to be called/emailed. Most good agencies will have close enough relationships with their clients that this wont be a problem.

Why is a good idea of budget so important? Well, it has a massive impact on how effective your agency can be for you. Whether a new online strategy, marketing collateral or a comprehensive brand exercise, the tools and methods your agency use will all be dictated by budget. As someone infinitely wiser than me once said, there’s more than one way to skin a cat. It’s the same for problem solving – multiple channels can be used, each judged on it’s own merits, and each one suitable under different budgetary constraints.

An extreme example would be TV advertising – it’s a great awareness and brand enhancing tool, but obviously requires considerable funds in the kitty. How is an agency ever going to make the right choices for you if you don’t give them the foundations to do it?

Giving an agency clear guidance on how much money you actually have to spend isn’t just important, it’s absolutely vital for your marketing and communications to be a success. It’s as important as getting the brief right – without it, you’re never going to get maximum ROI. Bizarre really, that so many companies think they can save money by misleading their agency, and even more bizarre is when the same companies wonder why they didn’t quite get what they were hoping for at the end of the project.