Should Your Agency Be Doing Work For Free?
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“There’s not a lot of cash right now, but you’ll get loads of exposure and I’ll make sure to tell all my friends about you!”
Anyone who has ever set out in a creative career (or provided any service) has suffered a similar request. So is working for free a good idea? Is the “exposure” worth it? In rare cases, maybe, but most of the time your “client’s” 19 Instagram followers are probably just as unlikely to pay as they are.
However, as you go beyond being a one-person-creative-machine, and start growing as a firm with more staff and a larger client lists, the chances are you’ll eventually be faced with the need to put together a pitch – which equates to lots of work for no money. Deciding whether to ask for a fee can be tricky, so let’s delve into the murky question: should an agency do work for free?
It Costs More Than You They Think
Pitching takes lots of time and resources, which means money. Overhead expenses won’t pay themselves. Studies have shown that corporate clients seriously underestimate the cost of putting together a pitch – in 2013, the ISBA and the IPA found that clients thought the average cost of a large international pitch was about $39,000 whereas it was in fact closer to $223,000. Despite what anyone thinks, that means you’ll be paying out-of-pocket to put them together, and the high costs are a very good reason that you may want to charge for a pitch rather than working for free.
That said, the disparity between the imagined and actual costs of a pitch means that even if a company does agree (or even offer) to pay, chances are their budget won’t come close to covering your costs. Generally, payments for pitches are more a token of good faith than a practical check.
The Times They Are a-Changin’
It has long been the case that agencies pitch for free. And, as with many things, people equate “how things are done” with “how things should be done.” However, a pitch in 2019 is far bigger and broader than it was 20 years ago. An agency has to produce more creative output to cover the different touch points of modern-day marketing – the digital channels alone could eat up weeks of work and thousands of dollars. As pitches change, perhaps how pitches are paid for needs to change as well.
Driving Up Costs
Won’t somebody think of the other clients?! Lots of free pitches means having to charge more in general just to break even. Even if you are on pitch lists for smaller clients, the range of media these days means pitches can run tens of thousands of dollars. Do ten pitches a year and you’re talking about needing hundreds of thousands in revenue just to break even! You can try to balance this out by being as discerning as possible and making sure things are serious client-side before taking on a major pitch, but even then you’ll be accruing costs at some point.
Let the Games Begin
Now, we’re not saying you live in the Hunger Games, but the client-agency relationship has changed and there is far fiercer competition than ever before. A boom in the number of agencies means more people pitching. They may not have the skills or services that you do, but more pitches means a more competitive environment, and a willingness to provide fee-free pitches could be the difference between landing a client and not (or even being put on the shortlist of agencies).
And it’s no surprise that clients aren’t willing to pay for pitches when you realize that many companies, especially SMEs, struggle to see the value in something before they actually see the creative output. Unfortunately, for a growing firm, landing these smaller clients could mean success rather than solvency and building a track record to land bigger fish in the future.
The IP Man
One of the biggest worries when pitching for free is that the client will take your ideas and get their internal team to implement them. Or, worse still, hire another agency to run with your ideas. There are arguments over who owns the intellectual property rights to the content of a pitch, but if you’ve done the work and created the idea, we all know who has a claim on it. This is when trust plays a major role and also the importance of building a relationship with potential clients.
Paving the Way for a Smoother Pitch
Whether you’re being paid in full, with a nominal fee, or are putting together a pitch for free, there are some ways to make the whole thing easier. First, technology to help manage time and projects is key to a successful pitch, allowing you to keep your team on track and streamlining the whole process. An easy way to accomplish this is with software such as Productive, which can be especially important if you do end up doing unpaid work. Having cloud-based software to help manage efficiency and productivity can lessen the strain on your agency and its staff, leaving them to focus on paid projects and reducing the cost of free work.
Another way to ensure smoother pitches is to take a cue from our British friends at the Good Pitch, with their six basic tenets:
Transparency – so both you and the client know exactly what the deal is from the word go.
Respect – have the right people involved and put in the work a pitch is due. But also, make sure the client respects the amount of work you have to do.
Communication and Access – cooperation between everyone, all the time.
Timing – short, timely pitches keep everyone’s costs down and reduce uncertainty.
Working together – a good relationship between you and the potential client can make all the difference in the world.
The best way to figure out if free work is the right path for you – and when to stop working for free – is by judging clients on a case-by-case basis. What is your chance of success? Is the client serious about the work? Will it lead to bigger things? How expensive will the pitch be? Then once you decide one way or the other, integrate tech to streamline the process and follow the basic principles of a good pitch. And even if you don’t make the cut, just think of the exposure you’ll get… Who needs money, anyway?!
