Sham pitches: Why do they still exist?

Great campaigns are a result of good insight, great strategy and often a fantastic client-agency relationship. So it isn't a crime for marketers to have a preferred agency partner that they want to work with. However, what becomes problematic for agencies is when large scale pitches are called despite the marketer or client already having a bias towards an agency partner, or knowing who they want on the account even before the pitch process has begun. 

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While these deceptive pitches leave agencies investing valuable time, effort and resources in a fruitless endeavour, clients may hold them to reinforce their current agency partnerships. 

According to Ara Hampartsoumian, CEO of The Observatory, who was previously the CEO of TBWA Singapore, these pitches often arise because organisations feel the need to put out tenders. This is not because they are unhappy with their current agency partners, but more as a way of being compliant and in the spirit of fair play. Sometimes clients may simply want to check if they are getting the right levels of service at the right market rate.

Additionally, the desire for a client to hold these pitches may arise from long-term relationships where the client and agency are too familiar with one another causing communications to slack, said Hampartsoumian.

However, many a times pitch outcomes are decided before the final presentation, added on David Mayo the ex-CEO of Ogilvy Malaysia, who now is the CEO ofADNA, a data-powered creative consultancy with offices across Asia. He shares the view that many pitches are held to get an overview of what would best fit a brand. 

“These pitches are often driven by the procurement need to have comparative submissions rather than a more [common] view of what is best for the brand and the business,” explained Mayo. 

Mayo also said that while big agencies can probably swallow the costs of getting involved in such pitches, the agencies that would give the client the most during a pitch are often the small and mid-sized agencies - which can get pressured to give the away work for free.

Sharing a personal incident, he said, "One client had us working for three months on a brief that we had helped develop for them, before we received a four line email thanking us for our efforts and if anything suitable came up, they would be back in touch. There was no explanation or offer to meet and walk through the decision - thats not polite or professional."

Specifically to the marketing and communications industry, Mayo who says there is a “dwindling respect for creativity and great ideas” and the steps needed to get to a relevant and meaningful consumer insights.

”Agencies only have themselves to blame if they are giving away free strategy and creative ideas, and marketers should know better than to call a beauty parade and expect that work for free. The best way to smoke out the wheat from the chaff when it comes to a pitch brief is to ask for a pitch fee. This way there is equity and the relationship is based on professional understanding,” he added.

What can agencies do about sham pitches?

CEO of the 4A'sKhairudin told A+M that the 4As encourages advertisers to adopt practices such as giving unsuccessful agencies constructive feedback and a window of 60 or 90 days after the pitch to announce final decisions. He also said that these pitch charades would be highly unlikely if the advertiser had committed funds under the Pitch Disbursement By Laws.

However, requesting for pitch fees has its own challenges, said Mayo.

"There have been instances where potential clients approached our agency with great enthusiasm, ambition and ample budgets without letting them know they are in a pitch situation. Usually we ask for a pitch fee as would any professional services firm but that is hard to do once you are already in a process when you discover there are other horses in the race,” he said.

Despite getting pitch disbursement from the 4As Malaysia, sham pitches can still happen which demoralises a team and eats into quality time that could be spent on other workstreams, explained Nizwani Shahar, CEO, Havas Malaysia.

In order to spot and safeguard against sham pitches, agencies have to sometimes trust their gut when a nuanced pitch dynamic seems off, she added.

“We need to have a sense of existing client and agency relationships, how are they doing, are they winning together or is the incumbent relationship not doing as well,” she said. “Look at the agencies invited for the briefing; is there a clear connection or relationship between client and agency personnel.”

Sahar also added that she would not be afraid to ask procurement why a pitch is being called if the client-agency relationship is healthy and if the procurement exercise is to refresh vendors.

How can we curb it?

Mayo believes that often the marketers are simply following procurement procedure. The cynicism creeps in when the marketing team tries to beat the procurement guidelines by making a decision and then pitching. Nonetheless, it is ultimately the role of the marketer to know their terrain, their business, their requirements and their agency options and to make considered strategic choices based on that knowledge.

“Marketers should work with procurement to get the best for their business without wasting agency time that could equally be put into either doing a great job of the brief in question, prospecting for other clients, or working for existing, fee-paying clients,” he said. He also added that marketers should be transparent with agencies that they hope to engage, and be transparent about the way the pitch will be decided.

Ultimately, its also about open communication, said Hampartsoumian.

“If clients and agencies could build more trust and keep those lines of communication open, we wouldn't have these 'sham' pitches popping up. Expectations would be clear, everyone would know their role in the partnership, its value, and how long it's meant to last,” he said.

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