Myer requires ‘bespoke agency’ on site as part of pitch
The tough terms of Myer’s creative pitch include a condition that anyone who wants the business must be willing to set up a bespoke agency located at the retailer’s offices, Mumbrella can reveal.
Myer called the pitch last week, despite Badjar Ogilvy being due to have a further two years on the account. The move coincided with the completion of a media pitch which saw incumbents Ikon see off PHD after a tough battle for the $40m-$50m account.
Myer says the requirement is similar to its existing arrangements.
As well as setting up the agency operation at Myer’s Melbourne Docklands premises, the winner will be expected to pay rent.
Let’s see.
– F.A margins.
– Zero addition to agency culture (as they’ll all be off-site)
– Slim creative opportunities given recent form by the brand
– A client whose relevance and retail model is rapidly dying
– Onerous pitch/procurement conditions, which is more than a hint of the way they’ll want to run the ‘relationship’.
Pass.
Why don’t they just hire staff?
Why don’t they just hire a creative director and set up their own mini agency?
Surely their marketing department has all the strategy ability sewn up.
“N.B. an occupancy fee applies” – seriously? Don’t you guys own the building?
Agree with the above….. sorry Myer, time for you to pass the baton!
Take it in-house. End of story.
You’ll find more of this in the future. I think it happened with another of the big clients I worked with recently. And it’s certainly happening in the digital world. Though the “occupancy fee” is a bit much.
@Mr Fox – Looks like this could be the start of an in-house team? Perhaps they want to ease the transition?
I don’t understand paying rent – Myer pays the agency, then the agency pays Myer rent? Probably the most absurd thing I’ve ever heard.
they won’t set up their own agency or in house dept as that involves:
– hiring good people and keeping them
– paying them as proper FT employees with all the benefits that come with that – super, payroll tax, work cover, holidays, carers leave, maternity leave
– someone having to give them adequate guidance not just ‘raise awareness’ written on a word document
– someone in finance having to approve the headcount
– not being able to fire them at will or ‘take them off the business’
– not being able to pay them less each year
– not being able to threaten them with ‘taking the business elsewhere’
– not being able to charge rents on their desk space
This is what happens when a market is woefully oversupplied. You get crazy demands that on the surface seem almost comedic; but you know agencies will be lining up to win it.
If this is as bad as it reads then it is quite an indictment on the industry. Everyone talks about collaboration and trying to solve client/agency problems (fair remuneration, etc) and then this surfaces. It is so unashamedly mercenary that I almost admire it!
For those who are wondering, the reason they don’t just do it in-house, I expect, is because additional head count sits on one part of the budget (and makes the Finance department very uncomfortable because it affects the numbers they report) while third parties sit elsewhere on the budget.
Just to play Devil’s advocate for a second. The only way we’ll see clients stop taking the piss in their pitch briefs is when agencies start declining to participate. In the current climate there will always be an agency that is willing to accept these kinds of terms.
Just bite the bullet and set-up “MyCreative” – or, expect the Agency dregs to be placed on-site with your team…do you seriously think any Agency is going to put their best people on-site with one client?
Hardly surprising as apparently the media pitch was won on who was willing to bend over and offer the most favourable (to the client) payment terms.
It would be lovely to see agencies refuse to pitch on these terms, but that’s probably too much to hope for.
No doubt that ours is just one of many agencies that wouldn’t touch this pitch with a ten-thousand foot pole.
I have no doubt that Myer will find their pool of options to be shallow.
I think you can tell a lot about an agency if they would want to work on that account with those conditions.
Ridiculous.
@ confused…Perhaps. I’ve seen more suits ‘bend over’ on this account at every client financial review, than you can possibly imagine. As a consequence, I’ve seen many many good people go to the wall, creatives and account service alike. – Bernie says ‘you’re too pricey’ Agency culls to keep the margins. (But I think you know that!)
There is a bigger discussion here beyond Myers pitch terms which goes to the heart of all client/agency relationships. A new financial model must somehow be addressed.
@ Bob Rabbit…MyCreative…Hmm, I like it. But less of the ‘dreg’. Over 50 people service that account at Myers office and they work damm hard to deliver every time. It depends what you call ‘the best’. If you mean winning shiny bits of perspex down at the casino every year, then no.
However, if you mean producing very above average creative work season after season so the agency can keep its doors open then yes, I would agree.
Myer are not so stupid.Most of the above observers are sadly out of date.
in house agencies have worked well for Hyundai/Kia with Innocean and Samsung with Chiel.It is a pity David Jones weren’t as smart when they pitched .Most big retailers would be better off.
Just look at the way Coles work with Big Red.These companies arev retailers as such 75% of their work is just that -RETAIL.Brand and strategy isn’t hard to buy.
Got the RFP document, didn’t read it past point 1.
Why any agency would even consider working for (not with) a business that operates that way is beyond me.
Their strategy could be to ultimately acquire an in house team/model but this poses too great a risk to Myer. Try before you buy and (agency) beware! Could go either way! Wonder how long the ‘relationship’ stands?
They are probably copying the strategy from US!
Pretty sure Myer have had teams in their offices previously.
@ Mr Fox – by ‘best’, I mean those not concerned with awards, nor the ‘glamour’ of a particular brand, but rather ensure their clients exceed their targets (and enjoy the process) and make a shit-load of money for the agency at the same time. Those people, Mr Fox, are the ones you want working on your account. But, you get what you pay for…the dregs.
How breathtakingly arrogant… Typical
@ bob rabbit…Tough words Mr Rabbit but never a truer word said. I totally agree.
Pass on the ankle grab…and smile
Myer’s problems, like David Jones’, have little to do with advertising. Their stores are antiquated, service is all but non-existent and their product range is neither unique, or exciting. But, of more concern for shareholders is that Myer should choose now, the lead-up to the biggest retail period of the year to begin this agency review. What they hope to achieve by demoralising their agency at a time when they need them to be most on their game is beyond me. One would’ve thought Myer management and strategy were in need of change before their agency arrangements.
Doesn’t surprise me at all.
Look what MYER did with DT Digital, put them up for pitch and didn’t get back to them for a whole year. And then only recently decided to buy out the whole DT staff that worked on the MYER account to work in-house.
Why agencies bother is beyond me! Asking to pay rent for desk space isn’t surprising – they have the same agreement with IKON as well.
Ridiculous! And unbelievably arrogant.
They won’t get anyone half-decent wanting to pitch on their business now.
Looking forward to seeing the shortlist…
I’ll bet all my chips on Mojo