1. IPA New Business Group New Business Survey 2010 STRICTLY CONFIDENTAL

2. 2 Research Objectives To determine the amount of time that agencies are given to prepare for various stages of the pitch process To provide an estimate of how this translates into time and cost within an agency

3. 3 Research Methodology All new business contacts in IPA member agencies invited to take part in the survey Online questionnaire Fieldwork conducted during February and March 2009 A total of 61 responses were received

4. 4 What does the document cover RFI/RFP submissions Credentials/Chemistry meetings Interim/Tissue meetings Pitch presentations Level and cost of resource required

5. 5 Management Summary It is clear from the responses received that a high level of agency resource is being applied to the new business process Each stage of the process requires that sufficient time is provided by clients and the parameters of each stage clearly defined

6. 6 Management Summary A typical full pitch process takes between 6 and 8 weeks from start to finish, depending on the number of stages that are involved RFI/RFP submissions1-2 weeks Credentials/Chemistry meeting1-2 weeks Interim/tissue meeting1-2 weeks Pitch presentations4 weeks

7. 7 Management Summary Agencies regard 6-8 weeks as being the optimum timeframe the pitch process This allows agencies sufficient time to: Get a grasp and reflect upon client business issues Undertake any necessary research Develop a sound strategic direction Produce a quality presentation

8. 8 Management Summary Pressures by clients to foreshorten or unduly lengthen the pitch process are not welcomed Agencies feel that credentials/chemistry meeting suffer from a lack of focus and direction from the client side. Clients should make it clear to agencies exactly what they require agencies to do at this stage of the process

9. 9 Management Summary Creative agencies with a gross income of £15m or more estimate that the full pitch process accounts for 99 man days at a minimum resource cost of £178,000, whilst an additional £31,500 is spent on out of pocket expenses Creative agencies with a gross income of between £5m and £15m estimate that the full pitch process accounts for 72 man days at a minimum resource cost of £90,000, whilst an additional £25,000 is spent on out of pocket expenses

10. 10 Management Summary Creative agencies with a gross income up to £5m estimate that the pitch process accounts for 47 man days at a minimum resource cost of £65,000, whilst an additional £7,600 is spent on out of pocket expenses

11. RFI/RFP Submissions

12. 12 The vast majority of RFI/RFP submissions take 2 weeks or less to complete How long do you get, on average to complete an RFI/RFP Submission?

13. 13 24% of agencies reported occasions where they had been given 5 weeks or more to complete a submission What is the longest amount of time you have had to complete RFI/RFP Submission?

14. 14 At the other extreme 31% of agencies reported being given a day or less to complete a submission What is the shortest amount of time you have had to complete RFI/RFP Submission?

15. 15 6 and 10 creative agencies are typically asked to prepare RFP/RFI submissions How many agencies, on average, are typically involved in this stage of the new business process?

16. Credentials/Chemistry Meetings

17. 17 Agencies are typically given 1-2 weeks to prepare for a credentials/chemistry meeting How long do you get, on average to prepare for a creds/chemistry meeting?

18. 18 23% of agencies reported occasions where they had been given 6 weeks or more to prepare for a creds meeting What is the longest amount of time you have had to prepare for a creds/chemistry meeting?

19. 19 At the other extreme 54% of agencies reported being given 2 days or less What is the shortest amount of time you have had to prepare for a creds/chemistry meeting?

20. 20 Agencies feel that they are given insufficient time to prepare for a creds meeting Are as important as the pitch but not briefed as such by clients Often used as a mini-pitch by clients rather than chemistry sessions Are often open-ended challenges with no defined requirements and little or no chance to ask questions

21. 21 Agencies feel that they are given insufficient time to prepare for a creds meeting Provide little opportunity to look into the organisation and the sector they operate in Provide little time to say something interesting or insightful about a clients brand or business Clients require a high level of detail that requires a significant degree of agency time and resource

22. 22 Between 5 and 6 creative agencies are asked to prepare for a creds meeting How many agencies, on average, are typically involved in this stage of the new business process?

23. Interim/Tissue Meetings

24. 24 Agencies are typically given 2 weeks or less to prepare for a tissue meeting How long do you get, on average to prepare for an interim/tissue meeting?

25. 25 Only 9% of respondents indicated that they had been allowed 5 weeks or more What is the longest amount of time you have had to prepare for an interim/tissue meeting?

26. 26 At the other extreme 49% they had been allowed less than 1 week to prepare What is the shortest amount of time you have had to prepare for an interim/tissue meeting?

27. 27 There are issues Agencies feel that these should be a mandatory part of the pitch process but… Procurement departments dont often allow them Often declined due to a perceived lack of fairness Client expectations of what the meetings are for need to be managed – they often expect fully crafted solutions

28. Pitch Presentations

29. 29 Agencies typically receive up to 4 weeks to prepare a pitch presentation How long do you get, on average to prepare a pitch presentation?

30. 30 30% of agencies reported being involved in pitches of 8 weeks or more What is the longest amount of time you have had to prepare for a pitch presentation?

31. 31 At the other extreme 47% having been given 1 week or less What is the shortest amount of time you have had to prepare for a pitch presentation?

32. 32 Agencies want sufficient time to prepare a quality pitch presentation Agencies wish to be given sufficient time in order to demonstrate depth of understanding of the clients business and brief But not so long that it becomes a drain on the day-to-day running of the agency

33. 33 Typically 4 creative agencies are asked to prepare pitch presentations How many agencies, on average, are typically involved in this stage of the new business process?

34. 34 Typically the results of a pitch are provided within two weeks How quickly, on average, do you hear about the result after a pitch?

35. 35 Over half of respondents reported instances of not being given a pitch result Have you ever not been informed about the results of a pitch?

36. 36 All but 2 agencies indicated that they were given opportunities for pitch feedback Do you ever have the opportunity to receive feedback after a pitch?

37. 37 Telephone feedback is the most likely form of feedback to be given by clients How often do you receive feedback of the following types?

38. Time Spent & Cost of Pitching

39. 39 Time Spent & Cost of Pitching In the charts that follow the following methodology has been applied ion order to drive pitch cost estimates Agencies have indicated the number of man days used during each stage of the new business process The total number of man days has been estimated on the basis of a 10 hour working day in order to take account of the out-of-hours working often required on pitches Hourly rates from the IPA charge out rate survey have been used to calculate man hour costs, using average rates by department as the basis Large creative agencies are defined as those with a gross income in excess of £15m, medium sized agencies those with a gross income between £5m and £15m and small agencies those with a gross income up to £5m

40. 40 For a large creative agency a full pitch accounts on average for 99 man days RFP/RFI Preparation Chemistry / Credentials Tissue Meetings Pitch Presentations Total Senior Management1.883.502.628.8816,88 Account Management2.634.506.2514.2527.63 Planning/Strategy0.632.504.3812.5020.00 Creative/Designers/Hypermedia0.501.755.1313.7521.13 User Experience0.250.000.130.250.63 Technical Staff0.130.00 2.002.13 Creative Services/Traffic0,630.881.883.006.38 Producers0.13 0.631.632.50 Channel Planning0.13 0.251.251.75 Total6.8813.3821.2557.5099.00

41. 41 For a large creative agency that equates to an estimated resource cost around £178,000 RFP/RFI Preparation Chemistry / Credentials Tissue Meetings Pitch Presentations Total Senior Management£7,880£14,700£12,750£47,470£89,270 Account Management£3,230£5,540£8,230£19,750£37,300 Planning/Strategy£1,060£4,250£7,870£24,710£38,880 Creative/Designers/Hypermedia£640£2,240£7,100£20,500£30,950 User Experience £250-£140£290£720 Technical Staff £100--£2,130£2,260 Creative Services/Traffic £460£650£1,820£2,910£6,190 Producers £130 £800£2,080£3,200 Channel Planning £150 0£1,590£2,190 Total £13,900£33,920£38,910£121,430£177,600

42. 42 For a medium sized creative agency a full pitch accounts on average for 72.3 man days RFP/RFI Preparation Chemistry / Credentials Tissue Meetings Pitch PresentationsTotal Senior Management 1.902.802.007.0013.70 Account Management 1.703.001.909.2015.80 Planning/Strategy 1,502.502.609.9016.50 Creative/Designers/Hypermedia 0.801.602.2010.0014.60 User Experience 0.400.900.301.202.80 Technical Staff 0.500.600.301.102.50 Creative Services/Traffic 0.100,300.202.403.00 Producers 0.200.400.300.701.60 Channel Planning 0.400.500.100.801.80 Total 7.5012.609.9042.3072.3

43. 43 For a medium sized creative agency that equates to an estimated resource cost around £90,000 RFP/RFI Preparation Chemistry / Credentials Tissue Meetings Pitch Presentations Total Senior Management £4,880£7,200£5,140£17,990£35,210 Account Management £1,430£2,520£1,600£7,730£13,280 Planning/Strategy £1,720£2,860£2,970£11,330£18,880 Creative/Designers/Hypermedia £740£1,480£2,040£9,280£13,540 User Experience £320£720£240£960£2,240 Technical Staff £350£420£210£770£1,750 Creative Services/Traffic £80£230£150£1,820£2,280 Producers £190£370£280£660£1,500 Channel Planning £280£340£70£550£1,,240 Total £9,990£16,140£12,700£51,090£89,920

44. 44 For a small creative agency a full pitch accounts on average for 47.14 man days RFP/RFI Preparation Chemistry / Credentials Tissue Meetings Pitch Presentations Total Senior Management 2.292.572.105,1012.05 Account Management 2.382,191.574.5210.67 Planning/Strategy 1.711.241.484.008.43 Creative/Designers/Hypermedia 2.140.761.244.768.90 User Experience 0.240.050.100.380.76 Technical Staff 0,140.100.140.711.10 Creative Services/Traffic 0,670.330.671.863.52 Producers 0,480.050.100.431.05 Channel Planning 0.14 0.100.290.67 Total 10.197.577.4822.0547.14

45. 45 For a small creative agency that equates to an estimated resource cost around £65,000 RFP/RFI Preparation Chemistry / Credentials Tissue Meetings Pitch Presentations Total Senior Management £4,570£5,140£4,190£10,190£24,090 Account Management £2,670£2,450£1,760£5,070£11,950 Planning/Strategy £2,420£1.750£2,080£5,640£11,890 Creative/Designers/Hypermedia £2,440£870£1,410£5.430£10,150 User Experience £240£50£90£380£760 Technical Staff £150£100£150£740£1,140 Creative Services/Traffic £590£290£590£1,630£3,100 Producers £540£50£110£480£1,180 Channel Planning £110 £70£220£510 Total £13,730£10,810£10,450£29.780£64,770

46. 46 Total out of pocket expenses range from an average of £31,500 for with a gross income over £15m down to £7,600 for a creative agency with a gross income up to £5m Pitch out of pocket expenses Over £15m gross income£31,490 £5m to £15m gross income£25,010 Up to £5m gross income£3,713