Matchmaker and marriage counselor

 
WW: The Swiss agency landscape is relatively straightforward. Why do companies need external consulting?
Roland Sutter: I am convinced that the Swiss market is less manageable than it seems at first glance. There are changes towards digital media and new agencies are becoming increasingly important. What's more, precisely because the landscape seems straightforward, the same "usual suspects" are always found in agency evaluations. We want to counteract this.
 
What services do you offer?
As a management consultancy, we specialize in the optimal use of marketing resources. Our offer is divided into four parts: 1. the selection of agencies, 2. the entire area of remuneration. We are committed to remuneration that satisfies both client and agency in the long term. In addition, we have models for the performance-related remuneration of agencies. This is an area that is still underdeveloped in Switzerland. The third area is called "Optimize ": we optimize structures and processes and repair relationships that are no longer running optimally. The fourth pillar comprises monitoring instruments, for example to measure agency performance.
 
Where is the focus?
Pitch consulting is just one pillar of our portfolio. We are currently advising more and more frequently. Against the backdrop of the digitalization of marketing as a whole (not just brand and product communication), we are helping companies to meet the new demands on their organization. Among other things, this means designing sensible marketing structures and reorganizing the composition of agency portfolios.
 
How do you proceed with the agency evaluation?
We work with a multi-stage process. This begins with the systematic identification and prioritization of the client's selection criteria. From this we derive the procedure for the search. We draw up a so-called "consideration list" of relevant candidates. Chemistry meetings are held on site at the agencies in consultation with the client. Once a shortlist has been drawn up, we accompany the pitch and then, if the client wishes, take over the contract negotiations and put together a suitable fee model. 
 
Your work ends with the pitch?
No, the pitch is followed by so-called "alignment workshops", in which the aim is to define the parameters of a successful collaboration in order to get up to operating temperature as quickly as possible. Regular "health checks" take place as part of a monitoring process. These consist of online and live surveys and serve to quickly identify what is going well and what is not. From this, we then make recommendations to ensure that the relationship remains successful. We are not just a dating agency, but also a marriage counseling service. However, the approach is always à la carte, depending on what the client needs.
 
Today, fee models are often determined by the procurement department. How much influence do you have there?
We have a great deal of experience in designing models that reward top performance and efficiency. For some clients, we even design new remuneration systems for the entire organization in cooperation with the purchasing and marketing departments. The willingness to discuss this is actually quite high.
 
What do you think about royalty-free pitches?
As an agency owner, I have always made a point of not taking part in any free pitches. However, as an advertiser, I didn't really care how much the fee was. It was never enough anyway! And the frustration of losing a pitch is huge, regardless of whether you received 5,000 or 10,000 francs or not.
 
And what is your opinion as a consultant?
I advise clients to follow national customs. In Switzerland, it is customary to pay for pitches. Clients should adhere to this.
 
For which companies does external consulting make sense?
Worldwide, it is primarily large, internationally active companies that rely on the services of Roth Observatory. Banks, insurance companies, manufacturers of branded goods of all kinds, car brands such as BMW, the first customer for whom we also work in Switzerland.
 
For smaller companies, the commitment is unlikely to pay off ...
 In most cases, companies only consider it sensible to engage a consultant once the agency relationship has reached a certain level of complexity. However, Roth Observatory's experience in Germany shows that our services can also be attractive for medium-sized companies. These companies often lack expertise in one or other aspect of the agency relationship.
 
From what budget is it worthwhile?
I don't want to set a budget limit - I don't have enough experience at the moment. The client has to decide on a case-by-case basis whether the advice pays off.
 
How are you remunerated?
We are paid by our clients on a time and material basis. Of course, we receive nothing from agencies in order to be independent.
 
What are the advantages of being part of the Observatory network? You could also have set up your own business as an individual consultant ...
The advantage is that I can use the know-how of the network. I know the Swiss agency scene and have many years of experience in client relationships. Roth Observatory also provides me with numerous tools for selection, remuneration and reviews. For example, I have access to a database with figures on agency remuneration worldwide.
 
How do agencies react to you?
I have only spoken to a few agencies so far. The reactions I have had have been positive. We now have an appointment with the industry association BSW, where we will be available to answer questions. It is important to me that the agencies are informed about our activities.
 
We have also asked around. There were points of criticism that I would now like to confront you with.
Okay, good. "
 
Consultants cause additional costs. This money would be better spent on communication."
That's a very simple statement. Look around at how many client-agency relationships waste resources every day because there is no agreement on goals and expectations. And this goes on for years. How many pitches are made every year that don't lead to the desired results? There are incredible costs involved. We offer practical approaches that pursue agreed objectives in a very focused manner. Feedback from other markets shows us that both Purchasing and Marketing are very satisfied with the results. Of course, there is a cost. However, we assume that the ROI significantly exceeds the costs we incur as consultants.
 
Another point: "Direct communication and collaboration with the customer is made more difficult by a consultant."
That is the complete opposite of what we are striving for. We try to improve cooperation. If something doesn't work, we step in to help. Otherwise, we keep a low profile as far as possible.
 
One accusation concerns the lack of neutrality when choosing an agency. How do you avoid being left out of the circle of "the usual suspects"?
Firstly, by covering as broad a spectrum of agencies as possible and keeping up to date with developments. To do this, we visit as many agencies as possible. Secondly, we carry out new research for every assignment. Thirdly, we don't simply suggest an agency. First, we draw up a consideration list, whittle it down to a shortlist and then invite 3 agencies to a presentation - not 5 or 10, as sometimes happens. But of course, the selection will never be "neutral" in the true sense of the word, but will reflect, to the best of our knowledge and belief, what we consider to be the optimal choice in consultation with the client.
 
Consultants sometimes pull the strings in the background, but do not make themselves known. Do you appear openly to the agencies?
Always. When we are involved, it is clear to agencies right from the start. That creates trust.
 
In Switzerland, there are already individual consultants and consulting firms that are sometimes called in for pitches. How do you rate the competition?
There are a few consultants, but the market is still underdeveloped compared to the rest of Europe. I see our offering as a fairly new service, especially because we have a range of tools in addition to pitch consulting that help companies make better use of their marketing resources. In my view, professionalization helps everyone.
 
Professionalization has already increased on the client side.
This is the case. Nevertheless, many client-agency relationships fail, for example due to a lack of briefing quality or a dysfunctional decision-making culture on the company side.   
 
What does a non-functioning decision-making culture mean?
Advertising used to be a matter for the boss. Today, everything is structured and hierarchical. Company structures are often designed in such a way that it is much easier for employees to say "no" than "yes".
 
What do you mean?
Employees have every authority to say "no" to the agency. As soon as they say "yes", they are held responsible internally. This makes it easier for employees to say "no". Work is often rejected first, it goes to a second round and in the end the client and agency are frustrated that it takes so long and costs so much. Professionalization in the decision-making process could contribute to an improvement.
 
What goals have you set yourself for the next few months?
A sales target is not yet in the foreground. The first goal is awareness: I want people in the industry to know us in a year's time. The second goal is reputation: I want to show with three or four projects that we are doing a good job. And a third goal is to have another partner on board in one to two years' time.

Interview: Isabel Imper

What agencies think of pitch consultants

When it comes to acquiring new customers, Swiss agencies rarely make the acquaintance of external consultants. Most are skeptical - even if opinions differ on the benefits and drawbacks.  
 
The agencies surveyed are largely critical of the external consulting services offered for agency evaluations or pitch support. Many emphasize that the involvement of a consultant makes it more difficult to maintain relationships and communicate with the client, as communication takes place via third parties. It becomes more difficult to get to know the potential client and to gain an understanding of the client's needs. In day-to-day work, the relationship between client and agency is crucial for success. The choice of agency should be made by the client and not outsourced. Many agencies question whether consultants are needed at all in the manageable Swiss agency market. Clients could get an overview themselves. Reference is made here, for example, to the pitch guide of the industry association BSW leading swiss agencies. One agency differentiates: Internationally active corporations may have a certain demand for harmonization of the process across several countries, but for Swiss clients the detour via the pitch consultant is considered rather questionable. The costs and the additional time required for consultants are also questioned. These additional expenses are in most cases disproportionate to the budget, they criticize. The money for interim consultants would be better spent on campaigns. Especially as the consultants are sometimes not worth their money. The consultants do not always shine with industry knowledge, as the survey shows. One agency was invited to a pitch by a consultant, even though its positioning did not fit the profile at all.

More cost pressure from consultants?

Very few believe that the financial conditions for the agency will become tougher with a consultant. The tenor is that cost pressure exists anyway. One explanation is that this is often controlled by the company's internal procurement. So are consultants completely superfluous from the agencies' point of view? No, in certain situations, the agencies do acknowledge that consultants have a right to exist. In the case of very complex, usually global tasks, it can make sense to involve a consulting firm. The same applies if the client lacks the know-how and is unfamiliar with the market, the agencies or the conditions. In such cases, the involvement of a consultant also appears to be worthwhile for the agencies. Cooperation can be improved by an external consultant, for example through greater professionalism in the tender, in the process or in the quality of the briefing.

 
How often do consultants come into play?

The final step is to find out how often consultants are involved in agency evaluations or pitches. In a survey, the German Association of Communications Agencies (GWA) found that external pitch consultants are involved in around one in ten budget tenders (2011). In Switzerland, this figure is likely to be much lower. Reliable data cannot be found at the BSW. The topic is on the pending list, says BSW Managing Director Peter Leutenegger. However, he does not consider the situation to be acute. In the survey conducted by Werbewoche, around a third of the agencies that responded said that they had never acquired clients through a consultancy firm. For the others, the number of cases could be counted on one hand. Only one of the agencies, a web service provider, said that up to a maximum of 20% of their new client pitches were conducted via consultants.

Who are they?

In most cases, the consultants are individual masks who have a good relationship with the client. Former McKinsey consultants or people who used to work in advertising themselves. Other agencies occasionally mentioned international consulting networks - but these are exceptions. And: established Swiss consulting firms (communications and business consulting) are apparently also active in the field of agency evaluation and pitch consulting. Once again, it became clear that many consultants prefer to remain in the background. They do not want their mandates to become public. Agencies that mentioned consultants by name were assured that their names would not be published. In some cases, the consultants even prefer to remain invisible to the agency themselves. In one case, the consultant only revealed himself in the final phase. In two other cases, the agencies only found out by chance that a consultant was involved. This lack of transparency is not exactly conducive to the acceptance of external consultants.

Isabel Imper