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Download the PDF: https://www.demandmetric.com/content/evaluating-agency-performance Evaluating agencies can help you gauge the performance and alignment of key partners. To create an effective agency performance evaluation, evaluations must occur on a regular basis. There should be a neutral evaluator, a consistent format, 360-degree reviews, and a clear follow-up plan. This guide will explain why you need to evaluate your agency, what criteria you should use, and how to conduct an effective evaluation.
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Evaluating Agency Performance EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE
2 Evaluating Agency Performance How-to Guide Evaluating agencies can help you gauge the performance and alignment of key partners. To create an effective agency performance evaluation, evaluations must occur on a regular basis. There should be a neutral evaluator, a consistent format, 360-degree reviews, and a clear follow-up plan. This guide will explain why you need to evaluate your agency, what criteria you should use, and how to conduct an effective evaluation. The Association of National Advertisers (ANA) reports that 82% of companies regularly review the performance of their marketing agencies. It is important to regularly evaluate agency perform- ance for the following reasons: 1. Improve Resource Allocation — when evaluating agencies, a regular assessment can help you determine what is working well and why. The companies that conduct regular assessments are likely to identify successful and under-performing aspects of their agency relationships. This will allow a company to allocate efforts and resources more efficiently. 2. Ensure Alignment — an evaluation can ensure that your marketing agency’s work is aligned with your company’s overall marketing strategy. 3. Budget and Measure ROI — a regular agency evaluation can help you understand the total cost of agency services, and will help you calculate Return on Investment (ROI). 4. Motivate Under-Performing Agencies — the companies that plan regular assess- ments are more likely to identify successful and under-performing parts of their agency relationships. This can lead to constructive conversations and improved performance. 5. Encourage Realistic Expectations — A regular agency evaluation can help you ensure that your company and its agencies are clear on expectations and are committed to the relationship. HOW-TO GUIDE Why is this Important? Evaluating Agency Performance Download the Demand Metric Agency Performance Review to help you leverage agency review best practices. 2 Evaluating Agency Performance How-to Guide Evaluating agencies can help you gauge the performance and alignment of key partners. To create an effective agency performance evaluation, evaluations must occur on a regular basis. There should be a neutral evaluator, a consistent format, 360-degree reviews, and a clear follow-up plan. This guide will explain why you need to evaluate your agency, what criteria you should use, and how to conduct an effective evaluation. The Association of National Advertisers (ANA) reports that 82% of companies regularly review the performance of their marketing agencies. It is important to regularly evaluate agency perform- ance for the following reasons: 1. Improve Resource Allocation — when evaluating agencies, a regular assessment can help you determine what is working well and why. The companies that conduct regular assessments are likely to identify successful and under-performing aspects of their agency relationships. This will allow a company to allocate efforts and resources more efficiently. 2. Ensure Alignment — an evaluation can ensure that your marketing agency’s work is aligned with your company’s overall marketing strategy. 3. Budget and Measure ROI — a regular agency evaluation can help you understand the total cost of agency services, and will help you calculate Return on Investment (ROI). 4. Motivate Under-Performing Agencies — the companies that plan regular assess- ments are more likely to identify successful and under-performing parts of their agency relationships. This can lead to constructive conversations and improved performance. 5. Encourage Realistic Expectations — A regular agency evaluation can help you ensure that your company and its agencies are clear on expectations and are committed to the relationship. HOW-TO GUIDE Why is this Important? Evaluating Agency Performance Download the Demand Metric Agency Performance Review to help you leverage agency review best practices.
3 Evaluating Agency Performance How-to Guide Download the Demand Metric Agency Management Playbook to leverage agency management best practices. HOW-TO GUIDE Key Evaluation Criteria Evaluating Agency Performance 1. Creativity and Innovation — agencies should generate creative and innovative ideas to help your company’s marketing strategy for the long-term. 2. Execution — a marketing agency should have a clear understanding of expectations and be regularly meeting these objectives. While your team should be involved with its marketing agency, it should not be required to spend an excessive amount of time to ensure that expectations are met. 3. Financial Stewardship — when working with a marketing agency, it is important that a positive ROI is realized. Agency partners should do everything possible, strategic- ally and judiciously, to create work that will have an impact on your bottom line. 4. Quality of Deliverables — agencies that do not deliver extremely high-caliber work should be replaced or closely evaluated to get up to the standard you require. When evaluating agency performance, both qualitative and quantitative measures should be used. The most common formal agency evaluation criterion includes: Regular agency performance evaluations allow you to determine successful and underper- forming aspects of an agency relationship and identify areas for improvement. If you are not currently evaluating your agencies on a regular basis, consider implementing this new process in your organization. Bottom Line 3 Evaluating Agency Performance How-to Guide Download the Demand Metric Agency Management Playbook to leverage agency management best practices. HOW-TO GUIDE Key Evaluation Criteria Evaluating Agency Performance 1. Creativity and Innovation — agencies should generate creative and innovative ideas to help your company’s marketing strategy for the long-term. 2. Execution — a marketing agency should have a clear understanding of expectations and be regularly meeting these objectives. While your team should be involved with its marketing agency, it should not be required to spend an excessive amount of time to ensure that expectations are met. 3. Financial Stewardship — when working with a marketing agency, it is important that a positive ROI is realized. Agency partners should do everything possible, strategic- ally and judiciously, to create work that will have an impact on your bottom line. 4. Quality of Deliverables — agencies that do not deliver extremely high-caliber work should be replaced or closely evaluated to get up to the standard you require. When evaluating agency performance, both qualitative and quantitative measures should be used. The most common formal agency evaluation criterion includes: Regular agency performance evaluations allow you to determine successful and underper- forming aspects of an agency relationship and identify areas for improvement. If you are not currently evaluating your agencies on a regular basis, consider implementing this new process in your organization. Bottom Line
4 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Conduct Evaluations On Regular Basis Use a Neutral Evaluator Consider Doing Mid-Term Reviews Maintain a Consistent Format Consider 360-Degree Evaluations Create a Clear Action Plan Companies should conduct formal agency performance evaluations on a regular basis, such as quarterly or annually. Action Plan STEP 1 - Conduct Evaluations On Regular Basis Implement the Agency Selection Tool for Fast Evaluation If you are looking for more insight into agency selection, use our Agency Selection Tool to evaluate and compare different ad agen- cies by analyzing them across a set criteria. V I E W R E S O U R C E Agency Selection Tool 4 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Conduct Evaluations On Regular Basis Use a Neutral Evaluator Consider Doing Mid-Term Reviews Maintain a Consistent Format Consider 360-Degree Evaluations Create a Clear Action Plan Companies should conduct formal agency performance evaluations on a regular basis, such as quarterly or annually. Action Plan STEP 1 - Conduct Evaluations On Regular Basis Implement the Agency Selection Tool for Fast Evaluation If you are looking for more insight into agency selection, use our Agency Selection Tool to evaluate and compare different ad agen- cies by analyzing them across a set criteria. V I E W R E S O U R C E Agency Selection Tool
5 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Conduct Evaluations On Regular Basis Use a Neutral Evaluator A trusted, neutral point person should be assigned to the evaluation. This is important because the person should be focused on objectives and metrics, as opposed to personal relationships. Action Plan STEP 2 - Use a Neutral Evaluator Consider Doing Mid-Term Reviews Maintain a Consistent Format Consider 360-Degree Evaluations Create a Clear Action Plan Source a Neutral Point Person to Assess the Evaluation Agency Compensation Audit Template V I E W R E S O U R C E 5 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Conduct Evaluations On Regular Basis Use a Neutral Evaluator A trusted, neutral point person should be assigned to the evaluation. This is important because the person should be focused on objectives and metrics, as opposed to personal relationships. Action Plan STEP 2 - Use a Neutral Evaluator Consider Doing Mid-Term Reviews Maintain a Consistent Format Consider 360-Degree Evaluations Create a Clear Action Plan Source a Neutral Point Person to Assess the Evaluation Agency Compensation Audit Template V I E W R E S O U R C E
6 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Consider Doing Mid-Term Reviews Companies that opt for an annual review process should consider having a more informal mid-term review at the 3 or 6-month point to avoid any surprises at year-end. Action Plan STEP 3 - Consider Doing Mid-Term Reviews Conduct Evaluations On Regular Basis Use a Neutral Evaluator Maintain a Consistent Format Consider 360-Degree Evaluations Create a Clear Action Plan Avoid Unnecessary Surprises with Mid-Term Reviews Post Project Evaluation V I E W R E S O U R C E 6 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Consider Doing Mid-Term Reviews Companies that opt for an annual review process should consider having a more informal mid-term review at the 3 or 6-month point to avoid any surprises at year-end. Action Plan STEP 3 - Consider Doing Mid-Term Reviews Conduct Evaluations On Regular Basis Use a Neutral Evaluator Maintain a Consistent Format Consider 360-Degree Evaluations Create a Clear Action Plan Avoid Unnecessary Surprises with Mid-Term Reviews Post Project Evaluation V I E W R E S O U R C E
7 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Maintain a Consistent Format A consistent format should be used across all agencies, although specific questions can be varied for different agency types. Action Plan STEP 4 - Maintain a Consistent Format Conduct Evaluations On Regular Basis Use a Neutral Evaluator Consider Doing Mid-Term Reviews Consider 360-Degree Evaluations Create a Clear Action Plan Consistent Formats Provide Clear Performance Data Agency Performance Review V I E W R E S O U R C E 7 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Maintain a Consistent Format A consistent format should be used across all agencies, although specific questions can be varied for different agency types. Action Plan STEP 4 - Maintain a Consistent Format Conduct Evaluations On Regular Basis Use a Neutral Evaluator Consider Doing Mid-Term Reviews Consider 360-Degree Evaluations Create a Clear Action Plan Consistent Formats Provide Clear Performance Data Agency Performance Review V I E W R E S O U R C E
8 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Consider 360-Degree Evaluations This style of review opens up agency perform- ance appraisals to greater depth and breadth of feedback, and can provide more insight to ensure more accurate and effective assess- ments. Action Plan STEP 5 - Consider 360-Degree Evaluations Conduct Evaluations On Regular Basis Use a Neutral Evaluator Consider Doing Mid-Term Reviews Maintain a Consistent Format Create a Clear Action Plan Enhance Your Assess- ments with a 360-Degree Evaluation Use our Performance Review Template to create a 360-degree evaluation that includes multiple perspectives, such as the agency reviewing themselves, the internal project manager, and an executive decision maker. V I E W R E S O U R C E Agency Performance Review 8 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Consider 360-Degree Evaluations This style of review opens up agency perform- ance appraisals to greater depth and breadth of feedback, and can provide more insight to ensure more accurate and effective assess- ments. Action Plan STEP 5 - Consider 360-Degree Evaluations Conduct Evaluations On Regular Basis Use a Neutral Evaluator Consider Doing Mid-Term Reviews Maintain a Consistent Format Create a Clear Action Plan Enhance Your Assess- ments with a 360-Degree Evaluation Use our Performance Review Template to create a 360-degree evaluation that includes multiple perspectives, such as the agency reviewing themselves, the internal project manager, and an executive decision maker. V I E W R E S O U R C E Agency Performance Review
9 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Create a Clear Action Plan Action Plan STEP 6 - Create a Clear Action Plan Following the review process, work with your agencies to create action plans that include areas for improvement and a commitment from them to meet your expectations for future performance. Conduct Evaluations On Regular Basis Use a Neutral Evaluator Consider Doing Mid-Term Reviews Maintain a Consistent Format Consider 360-Degree Evaluations Leverage Your Agencies with Set Action Plans Agency Alignment Strategy Workbook V I E W R E S O U R C E 9 Evaluating Agency Performance How-to Guide 1 2 3 4 5 6 Create a Clear Action Plan Action Plan STEP 6 - Create a Clear Action Plan Following the review process, work with your agencies to create action plans that include areas for improvement and a commitment from them to meet your expectations for future performance. Conduct Evaluations On Regular Basis Use a Neutral Evaluator Consider Doing Mid-Term Reviews Maintain a Consistent Format Consider 360-Degree Evaluations Leverage Your Agencies with Set Action Plans Agency Alignment Strategy Workbook V I E W R E S O U R C E
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