You're about to launch a market changing medical device. Very exciting, but you have a million things to prepare. To guarantee success, you must manage everyone's expectations from the sales team to senior management, develop the strategy, create materials (digital and traditional) and arrange the launch events (albeit online). No small task!
You and your team must focus on the most critical tasks, so you consider working with a marketing agency. Great idea, however, how do you ensure your costs don't spiral out of control?
Here are 5 top tips to keep your agency's costs in check without compromising quality.
1. Understand How Agencies Price Projects
Agencies work on time. It is important to remember this when managing costs because you are paying for your agency's expertise. As such every time you use a team member a cost is allocated to your project. You can pay for your agency's time in different ways depending on how long you have worked with your agency and the size of the project.
Hourly is a great way to get small projects done quickly. Each member of your agency will have an hourly rate and your final cost is a sum of time spent. Nice and simple.
Pros –Good to get small projects completed quickly
Cons –Costs can rise if you don't work efficiently with your agency (see 2-5)
A project is principally the same as hourly, but your agency will provide you with an upfront cost based on the project brief supplied so you can add this to your budget. Project pricing is a smart way to go for larger projects as it's all too easy to underestimate the time a project requires, which is no good for you or your agency.
Pros –Your agency will provide a fixed cost which will be the price you pay unless the scope of the project changes (see section 2)
Cons –If you're efficient working with your agency, this may be slightly more expensive because your agency will estimate projects on the 'average cost' of similar projects.
Retainers are just like subscription fees and significantly reduce the amount of administration needed when working with your agency, removing the need to raise a Purchase Order (PO) number for every project. Retainers are great for companies with an annual budget, ongoing projects, and an established relationship with their agency. As soon as you sign a retainer, your agency will allocate you a fixed amount of time per month, often at a slightly discounted rate. A retainer provides you with access to your agency's full staff and as this time is set aside for you, your projects will get priority. Additionally, if you don't use your time, your agency will often allow you to carry it over to the next month or quarter.
Pros –Your agency will prioritise your work, and you will not need to create POs for every project, significantly reducing administration.
Cons –If you suddenly stop working with your agency, the remaining time will not be refundable
2. Ensure a detailed brief every time
No matter how you pay for your agency's time, you must ensure your agency understands the full scope of the project from the beginning.
This will prevent wasted time on both sides and keep your costs low. If you have any concerns that your agency doesn't understand the scope of your project, keep asking questions until you are satisfied you are both aligned. This will ensure your agency is focused on what needs to be done and will prevent later misunderstandings leading to unnecessary price rises.
If you are paying your agency by project, make sure you ask for a detailed estimate of work.
This way you and your agency have a written document to refer to if any queries arise. Neither side wants to hear 'I thought' later on as this always costs someone money.
3. Control the number of review periods
Small changes during a project are inevitable. Agencies typically plan for up to 2 review periods per project, but more can quickly result in increased costs.
Did you know, each change can easily add 30 minutes to a project (often more) once the account manager has read the changes, processed them and actioned them by the right team. If you inform your agency of every change separately, this will rapidly increase your agency's time, resulting in an unexpected hefty bill.
That isn't to say you shouldn't have changes throughout your project, but if you can reduce the time required by your agency for these changes that will have a significant impact on your final bill. A great way to do this is to close all internal reviews within your company before your agency is updated.
As a good benchmark, if you're working with the right agency that understands your project needs, your first draft should be at least 80% correct, requiring only minimal changes, so it is perfect following two reviews saving both time and budget.
4. Have only 1 point-of-contact with your agency
So, you now know how to minimise your costs on review periods without compromising quality or service. But did you know you can reduce costs further? It's true!
This can quickly be done by designating a single point-of-contact (POC) to communicate with your agency about any updates.
Several POCs can cause confusion and accountability issues because of changes based on personal preference, increasing review periods and guess what?...that's right, costs will go up.
If you have multiple departments, assign 1 POC within each department and allow them to appoint 1 POC who will communicate to your agency. Multiple people contributing to changes will burn time and overrun your agency with emails increasing costs. It all comes down to time.
5. Understand the points of no return
Your agency will have well-established processes for each service they offer. These processes drive efficiency and minimise escalating costs. Make sure you ask your agency when the cost breakpoints are for your project (the points at which going back will incur fees). A great example of this is a medical animation or website build. The steps for this type of project are as below:
If you return to an earlier part of the project once signed off, it will result in that part and the in-between parts being updated, or worst started again. These un budgeted changes will take your agency's time and cause costs to escalate.
Your agency will generally provide you with 2 review periods before each point of no return to ensure everything is correct.
By understanding these 5 key points you will expertly control costs when working with your agency and ensure you use their time for what they're fantastic at. After all, you are paying them for every moment they spend on your project, so you want to get absolute value for money!
Things your Marketing Agency should do to help you contain costs
• Be well-versed with the market demands.
• Understand and relay your vision the first-time round.
• Present precise estimates with an easy-to-understand picture of the time-based budget for you.
• Update you regularly so that you know where your costs are.
• Have a specialist response person (the account manager), always prepared for your concerns and queries
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