Is free pitching the solution to the economic crisis?

With a global financial recession hovering on the horizon, many businesses are struggling with rising energy prices and falling consumer buying power. Marketing spend is coming under the microscope, so it’s understandable that business owners want to save money in any way they can.

The free pitch

Free, creative and speculative pitches are different names for the same thing, where agencies put forth their creative solutions to a client brief, and the ‘winning’ pitch gets the work.

It’s one of the most contentious practices in our industry, birthed in the days of big advertising agencies and big budgets. Over the decades it’s become widely accepted as the norm, and after a short hiatus it seems to be on the rise again, in a struggling economy where communications need to work harder than ever.

But does the free pitch deliver? It’s easy to think that getting ideas for free is a win-win situation, however, in the long-term it may not always provide the best value for money, or give clients what they really need. The Design Business Association (DBA) has launched a campaign calling for the end of free pitching as a method of selecting a design agency.

The hidden costs of the free pitch

It’s easy to see why pitching for free might not be an economically sound or sustainable decision for the design agency, but we looked at why it might not be the best solution for clients:

• Some agencies have a blanket ‘no-pitch policy,’ so you may not get the agency on board that’s the best fit for your business or strategy.
• Comparing hourly rates isn’t always helpful as what you get for your money will depend on productivity rates, and whether the agency needs to spend time getting up to speed with your offering or industry.
• A ‘pitch brief’ usually doesn’t give design agencies the same deep dive into the business objectives and strategy. Without this, pitched solutions are often creative, but may not be the most strategic solutions, or the best solution for the long-term.
• Free pitches don’t just waste agencies’ time, they waste your time and money too. It’s all too easy to underestimate the number of hours it takes to review all the proposals submitted in the first stages of the procurement process – time which might be wasted if the shortlisted agencies’ creative skills then fail to meet the mark.
• Some agencies will put whoever is not busy onto a pitch. This means you might not have the creatives with the relevant sector experience working on your project. You might not get the in-depth creative thinking that you need going forward, as you would from a senior, or specifically selected team.
• The cream may not rise to the top, because the pitch may not be a true reflection of the capabilities of the agencies involved. The most fleshed out ideas could simply be indicative of a less busy agency in the period running-up to the pitch. The best solution for your business is the one that will deliver the best return on investment. And the agency with the best credentials, portfolio and experience in your industry is usually the best place to start.

The long-term effects of free pitching

Pitching for free isn’t an economically sound or sustainable decision for the design agency and that can also have ramifications for clients….

• Expecting someone to work for free and share expertise that will add value or aid business growth is unethical, but it can also lead to higher costs for creativity in the future.
• Agencies are also feeling the financial strain and regularly dedicating teams to work for free inevitably leads to the agency covering their increasing costs. In effect free pitches push agency rates up! Which is damaging for agencies and their clients.

So, what’s our stance on free pitching?

Our stance largely mirrors that of the DBA. A relationship with a client that begins by undervaluing creativity is never destined for greatness, and we don’t want to inflate our prices just to cover consistent free-pitching. An agency may invest between £10,000 to £100,000 in a creative pitch, so we think it better to take a considered approach.

When approached to pitch for a project or a client, we do a lot of due diligence and research before we go ahead.

• We strongly believe that to get the best outcome both for the agency and the client we need to build relationships. A chemistry meeting ensures that you get an agency with the right experience and who you can work well with as you pursue your brand’s strategic goals.
• An in-depth brief, immersion session is key to getting a creative team that really understands your business needs and market challenges. This level of dialogue is almost impossible in free, creative pitches so when a potential new client is willing to invest that time with us upfront, it can be a promising sign for the relationship to come.
• We are increasingly accepting initial smaller paid briefs as a way for clients to see us in action, check the agency fit, and get work of value at the end. On several occasions this has become an alternative route for us to welcome new clients.
• There is also the matter of returns for the initial creative investment. Clarification over budgets and the scale of assigned work following a pitch win is vital if you want to get the best people on board.
• The number of agencies involved in the process is key. Rather than investing a little time on lots of different creative agencies, we believe it’s far better to spend longer engaging just a few, so you can really get to know an agency and how well they know your industry, as well as how they’ll work with you.
• Finally, we take our intellectual property (IP) very seriously, so unless work is ultimately paid for we retain the IP on any pitched work. Anything else would be unethical. We’ve heard too many stories of pitched ‘options’ appearing in later campaigns, or being used internally.

If all of these conditions prove promising, and the right conversations are being had with the team you’ll ultimately be working with, only then do we agree to pitch.

So if you are thinking about entering into a pitch situation, consider the following:

• Ensure you’re meeting the team you’ll be working with going forward. You want the best people for the job, and understanding the chemistry you have with them is fundamental to the success of a client/agency dynamic.
• For the best results you want a collaborative relationship, where your agency can work with you as a design partner, and apply their skills and knowledge in the pursuit of your strategic goals.
• The goal is to produce creative that challenges expectations and stretches market reach and engagement targets. Perhaps in order to achieve this, a pitch may not be the right route after all.

We think working this way is far better value for money than using the open tender process, which may not be the most cost-effective way to choose an agency.

So why not take the risk out of pitching – by engaging the right people and investing time in a relationship that gets results!