Tim Williams

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Why Advertisers Want Value-Based Agency Compensation

Posted by Tim Williams on Apr 16, 2015 5:45:00 PM

With our thanks to Tim Williams from Ignition Consulting Group for this article

It surprises most agency professionals to learn that many advertisers are intensely interested in exploring a value-based compensation arrangement with their agencies.  A recent position paper from the Association of National Advertisers (ANA) states it clearly:  “Traditional metrics used in today’s cost-plus compensation agreements (usually based on time) have no relationship with the external value created for the client in today’s intellectual capital economy.  Therefore, pricing should instead be based on results and value created."