• We have moved from the age of commission to the
age of fee, time based schemes, to the era of ‘what
on earth are we going to do next?’
• Commission was predictable, and linked agency
fortunes to the success of a brand
– But had nothing to do with scope of work or agency costs
• Fees reflect scope of work and agency cost
– But are difficult to negotiate
– And do not relate to whether the marketing
communications are working
– Or marketplace success
– Some agencies like more risk/reward than others
The key questions
• Are we really moving away from time based
• Is there any further future in commission?
• How well is Payment by Results (PBR) working?
• Paying by value?
• Are there any new ideas?
Samantha Nolan, Chief client officer, RAPP
Gavin Wheeler, Chief executive, WDMP
Tina Fegent, Director, Tina Fegent Limited
Colin Fleming, Chief operating officer, AMV BBDO
Will Hamilton, Managing partner, Hamilton
Ten Step Process to Success
• Client provides agency with goals.
• Negotiation on extensive scope of work.
• Agreement on tenure
• Vital to establish the territory covering the
• Agency prepares costs on agreed scope of work
• Prepares work plan based on people hours
4. FIRST SUBMISSION ON
• We feedback ranking only - and then agency makes
Second submission to form agreement5. SECOND SUBMISSION
Ten Step Process (6-10)
• Both sides agree level of agency remuneration…At
the point where cost provision and the cost of people
• Client confirms KPI’s to Agency. The two sides agree
PBR terms (which may involve ratcheting the profit
• At this point Client and Agency come to terms on
how much Client is going to pay the Agency
8. TERMS AGREED
• Client and Agency agree how performance is going
to be evaluated…and remuneration reviewed in a
• The final step: definitive discussions on exactly how
the agency is to be paid and on the form of contract
to be used
10. FINAL TERMS