Why the talent crisis has been positive for wasteful new business pitches

The ongoing war for talent could actually improve the client-agency relationship — if it puts an end to new business pitch madness. 

This would be a long time coming, as lamentations about the horrors of pitching have become a part of agency folklore.  

The agency selection process has become more bloated and burdensome over time. Market research, RFIs, chemistry meetings, tool and tech sessions, workshops, RFPs and negotiations only provide a partial picture of the enormous effort and costs that agencies shoulder during a normal pitch process — all without any significant fee that would fairly remunerate them for the heavy lift.

But the talent crisis, of all things, could expedite the end to this pitch madness.

From demand to supply

As agencies struggle with scarce resources, the fight for talent has become a limiting factor to business growth. With rising salary and overhead costs, agencies are forced to allocate their resources to maximize profits strategically in the long-term. This is nothing new. But today, as talent remains scarce, agencies must consider more carefully than ever which pitches they want to deploy their resources for.

We are noticing a paradigm shift from a demand market to a supplier market. Pitch consultants are having a harder time filling the illustrious field of participants than in the past. Sometimes, they can’t find agencies to pitch at all. The timing and process of pitches are also being specified more often by agencies.

These changes mean that agencies will have to scrutinize their existing and prospective client relationships even more critically in the future. The days when agencies accepted jobs on almost any terms are a thing of the past, simply because they no longer can (staff shortages) or want to. Agencies have changed a lot with regards to flexibility and fair overtime regulations and are unwilling to risk burning their people out.

Long-term collaborations benefit business

This emerging dynamic offers opportunities for longer-term and closer collaborations between agencies and clients. Clients and agencies both should carefully examine whether changing their partners would bring more opportunities than risks.

In a best-case scenario, this new dynamic will foster greater transparency and communication between agencies and their clients, which can help mitigate knee jerk reactions and create more sustainable partnerships. In a world where short-term focus all too often shoves out  long-term strategy, this may provide a glimmer of hope.

Clients are reevaluating core beliefs

One of the fundamental misalignments in client agency paradigms comes from siloed structures. In too many instances, agency partners are used only for a specific task along the value chain, lacking information and struggling to get a full overview of the client brief. This makes it nearly impossible to contribute to business objectives by bringing all of an agency’s talent, creativity and resources to bear for a client. 

Clients must integrate all of their partners to get the most out of all of the different stakeholders. Otherwise, agencies will optimize within their silos, which can be contradictory and inefficient to meet client goals.

Through mutual trust, respect for scarce talent and a willingness and courage to question processes, brands have the opportunity to replace existing, calcified infrastructures with something more agile and dynamic.

Sebastian Schichtel is managing director at Crossmedia Germany.