July 3, 2017
Once upon a time, there were three little four-legged entrepreneurs. All wanted to build that house of success. The first rushed out without planning. Aesthetically it looked perfect, but this little one didn’t think about foundations. The second knew the importance of planning and preparation. This little one went to business school. But when work presented itself, it got impatient. It was scared of having early difficult conversations. It needed to see results right then and there. Plans were abandoned, unresolved issues were buried. Aesthetically, it also looked perfect.
The Third Little Pig knew that future long term success relies on solid foundations. It relied on practical, trusted advisers. It knew the upside, it knew the potential risks. It asked difficult questions and waited for consensus. It built protections to address the risks. When others came to question its approach, it continued to focus on and work toward its goal. It took a little more effort, it might not even have to be perfect, but both aesthetics and foundations were present.
The winds will come blowing
Strong foundations are also a key element of a successful client agency relationship. My life as an agency in-house lawyer has exposed me to the inner workings of a vast number of client agency relationships, from start to finish. All relationships start well, but relationships do end. Most depart amicably, occasionally this is not the case.
There are recurring themes around a failed client agency relationship. Many client agency relations fail due to an unrealistic or mismatched set of expectations between client and agency, and lack of regular, honest, mutual assessments of each party’s performance. So how can you prevent this?
From a lawyer’s perspective, a well crafted client agency contract serves as a solid foundation and a reference point from which both the agency and client are guided along an agreed path to mutual success. Here are some pointers to what makes a good client agency contract.
The terms reflect the agency’s marketing services
A contract written to purchase goods is not likely to be suitable for governing public relations services. A contract for cleaning services should not form the basis for a contract to govern social media marketing work. Clear as it may seem, many use a “one contract fits all” and refuse to be flexible to changes that reflect the work that is undertaken. Your agency is most likely to have templates that already reflect the nature of marketing services. In any event, if the agency and client both agree that their actual way of working deviates from the contract, then let’s change the contract to reflect this.
A properly calibrated contract can improve agency work
Clients demand creativity from agencies. Creative solutions often stretch boundaries and require the agency to venture out into the unknown. Agencies need the freedom to create. With creativity and freedom comes risk. If the agency’s risk isn’t limited at a level it feels comfortable with, the agency will naturally be hesitant to take on risk and will limit its creativity. This in turn affects the quality of the agency’s output. A contract can calibrate the level of risk against the nature and size of the project involved, so that the agency can work with security and without undue inhibition.
A two-way street
An agency cannot properly support the client without the client supporting the agency. The best work requires close collaboration between client and agency. Clients often contribute to agency output in the form of providing products, product specifications, sales data, quotes, photography and software. In addition, an agency needs timely access to client teams and a prompt approval process. It is clear that the success of the relationship depends on the mutuality of obligations between client and agency. This should also be reflected in the contract.
The Third Little Pig took time
The reality is that tailoring contracts take time. Legal teams are small and their resources are prioritised across the company. The other reality is that marketing projects need executing as soon as possible. However, it is not necessary to delay marketing projects pending contract negotiations. Short form interim agreements, or Letters of Intent (LOI) enable work to begin pending resolution of the full contract.
Patience, care, flexibility and collaboration may not be the typical words you hear from a lawyer. But like the Third Little Pig, the effort you place in the beginning will surely pay off at the end.