Signs Your Advertising Agency Is Wasting Your Money
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There may have been a time in the not-so-distant past when your business and advertising agency were in perfect sync. The campaigns fired on all six cylinders and customers came running through your door every time.
And then one day you realize things aren’t what they used to be. Your budget has increased, but the results have declined over time, and you start wondering if your agency of record is still a sound investment. Like B.B. King once sang: “The thrill is gone.”
When you start feeling like your partnership is no longer paying off, it’s important to get to the heart of the problem. Blaming your agency for lost business when your entire industry is experiencing a slowdown is like blaming a storm on your raincoat. But if results have been trending down for an extended period of time, and you’ve communicated this with your agency, you should see evidence they are trying to right the ship again.
Here are a few signs that may indicate an agency is wasting your hard earned money.
No Change in advertising strategy in years
People say you should never fix anything that’s not broken, and while that’s true, advertisers know that every strategy needs tweaking over time. Your marketing should be constantly evolving, and if your agency is not testing new strategies as they go, that’s a problem.
Everyone has a bad quarter once in a while, but when revenue keeps trending down and your competitors are holding their own, something is broken either in your product, service, or in your marketing. If you are certain the problem is the latter, your agency should bring new ideas to the table fast.
focusing on vanity metrics
Vanity metrics are useless statistics that come up in digital performance reports. I call them useless because, even though business owners love to hear how many Facebook and Twitter followers they’ve gotten or how many clicks this ad generated, these metrics ultimately mean nothing when the goal is to increase revenue. Any KPIs (key performance indicators) that aren’t tied directly to an increase in leads or sales is a waste of time.
If your agency focuses on vanity metrics, it could be a smokescreen that makes it look like they’re doing a stellar job, when in fact your sales are tanking.
always trying to increase your budget
This is a huge issue that should never be ignored. The whole point of retaining an ad agency is to maximize results with your existing budget. These are not sales people looking to get their hands deeper into your wallet.
If your business starts scaling up or your market grows (two very good problems to have), it might be time to reevaluate the budget and examine opportunities, but if your agency is constantly looking to increase the budget as the only way to succeed, it’s time to part ways. An experienced agency will know the investment required to do a good job, and that budget should be finalized long before your results start suffering.
investing too much in costlyplacements
Media placements play a big role in the success of a campaign, and the options are dizzying. If your business sells high-ticket, high-margin products, then buying some premium placements make sense. This is why you see car dealers in prime-time TV all the time. Their marketing strategy depends on massive reach, but reach should not come at the expense of frequency. A strong advertising strategy should focus on frequency and reach – as much as the budget will allow.
Some ad agencies devote way too much of the media buy on premium placements because it inflates the business owner’s ego. This is wrong and unethical on many levels. A good agency rep will speak up when a client asks for something that will hurt results. If they don’t, you’ve got a bunch of “yes men,” not advertising professionals.
While it’s important to recognize when an ad agency is wasting your money, it’s equally vital not to assign blame prematurely. Look objectively at your business first and address issues that might be hindering progress. Checking out your customer reviews is a good place to start. If you see a pattern of complaints the problem may be deeper than a faulty advertising strategy. In good times and bad, it’s important to keep an open and honest dialogue with your agency. When people are comfortable with speaking freely, good ideas come much easier. And so do results.