Agency leaders should feel confident to drop out of ‘disappointing’ pitches: Dan Monheit
During a period of increased pitches, particularly high profile ones, Hardhat CEO Dan Monheit has warned others agency leaders that they need to be confident to pull out of them if they don’t feel right.
As agencies compete hard for new business in an increasingly challenging economy, Monheit has suggested there has been increasingly questionable behaviour from clients who might underestimate the magnitude of effort and energy that goes into the pitch process.
“As long as there are agencies hungry for work, and there are clients with work, pitching will be here forever. But, I think the thing we often tend to forget as agencies is that if we don’t like how things are going, we don’t have to go,” Monheit told Mumbrella.
“No one is forcing us to do this. There’s always reason to knock back pitches, like scale, cultural fit, and conflict,” he said. “But increasingly I’ve noticed in the last six months we’ve been pulling out of pitches for things that just don’t feel right in the process.”
His comments come as the so-called ‘pitchapalooza’ of 2023 continues, with TPG Telecom, IKEA and Unilever being the latest to take accounts to pitch.
Monheit says that lately, questionable processes seem to have been taken to the next level.
“There was one unpaid pitch that stipulated in the NDA that the client owned everything that we presented,” Monheit said, describing one of the more extreme examples.
The pitch required each participant to come up with full strategy and creative ideas.
Monheit’s biggest concern was not the risk of the brand taking the agencies ideas for free, but that the process itself was indicative of how little “value they [brands] placed on the work that agencies do.”
Another issue he shared was of clients “not providing budgets” ahead of a pitch. Without an understanding of the budget, agencies are left both without the ability to correctly tailor the strategy, but also without an understanding of whether the effective “risk” of pitching is worth the value of the account or project.
“There can be an assumption that we would be happy to work for their business and it doesn’t matter much what’s in it for the agency.”
Monheit’s advice for other agencies that are met with pitching terms that feel unfair is to remember they have the opportunity to walk away if they feel it’s not right.
“It’s about having the confidence to know when it’s right and when it’s not right, and what you’re not okay with,” he said. “We don’t have to go into a relationship where it feels like we are being exploited before it’s even started.”
“There was one unpaid pitch that stipulated in the NDA that the client owned everything that we presented,” Monheit said, describing one of the more extreme examples.
Speaking from significant experience (50+ new business pitches in the past few years alone of various scale), the demand that all IP is owned by the client (regardless of whether you win the pitch or not) is not new and certainly not extreme.
To echo Dan’s point, it completely devalues the work we produce and further reinforces the cost vs. value dichotomy that procurement-led pitches increasingly focus on.
As an aside, for those companies that do pitch, they wax lyrical about their anti-slavery positions and statements, and yet are hypocritical in their treatment of, and expectation of pitching agencies, expecting at worse, indentured servitude and at best down right IP theft.
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It’s not that clients don’t understand the cost of a pitch for an agency- they really don’t care. Too many marketing execs in Australia get there by playing a 3-year shell game. They only know how to run a pitch – wouldn’t have a clue how to build and brand and grow a business.
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As Bill Bernbach said many moons ago: “A principle isn’t a principle until it costs you something”.
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Clients frequently do steal valuable ideas from pitches. I know this from personal experience. The ‘middle management right to steal’ has to be stopped, and the very notion that a client should own unearned IP is shameful.
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