‘What’s a conflict and what’s not a conflict?’: Confessions of an agency search consultant
For years, search consultants acted as middlemen, organizing agency reviews for marketers. But the role of a consultant has changed with the times — penny-pinching clients now question whether they need them at all, changing the very model of the business, which was, in theory at least, based on impartial objectivity. A lot has changed.
In this edition of Confessions, we traded anonymity with honesty and chatted with a veteran of the search consultant business.
What’s happened to the business in the last couple of years?
First of all, what has happened is that about 80 percent to 90 percent of agency searches are done by clients themselves. So, there’s a small pool now of clients — big enough to make a living — who either have experience with search-consultant world or recognize they need one.
Are there more consultants out there?
There’s more competition. People age out of the ad industry and go into consulting, and agency consulting is kind of sexy. People think they’ve been through searches, so they know how to do this.
Are they right?
Kind of. There’s no magic to the process. I’d like to think the magic is what you bring in terms of insight.
People complain the search process is opaque.
It’s a very disciplined process. It’s opaque when you haven’t participated in it. We are extremely open with agencies, agencies would rather work with us because we get to know our clients, and so when they ask asking us questions, we brief agencies, give people feedback. It’s as opaque as you want it to be.
Can agencies game the system?
Yes. There are search consultants — and everyone knows this — that have registries and libraries you pay to get included in. The implication is once you register, you’re likelier to be included in reviews. The pay-for-play is fuzzy, and we’d like to do it, but we don’t.
There have been a lot of broadly defined consulting companies who are doing more reviews now.
Yes. There’s no barrier to entry to this space. Going for search and compensation is low-hanging fruit. You can also do agency valuations and some roster modeling. There are consultants who now also help with internal restructuring of marketing departments or brand strategy.
There’s also, with ad tech and mar-tech, so much more complexity in the world. Consultants are setting up shingles to help determine what kind of ad tech and mar-tech people need.
There can be a lot of conflict of interest here.
Sure. Clients are paying less, and more are doing searches themselves. So you find other sources of revenue by doing other types of consulting. A lot of companies that used to be on the vendor side are now search consultants helping clients figure out agency and tech rosters. They either used to be paid by them or are paid by them now. But clients don’t always know. You can also do things like that informally and not monetize it.
Which means you just don’t declare it?
I would say there’s a line of demarcation, and they’re being drawn, and they’re very much in flux. What’s a conflict, and what’s not a conflict? To be very honest, consultants take on whatever a client is willing to give us. Consultants now work for agencies too. We took that part of our practice off our website — we do things like workshops for agencies, that’s it. But other companies do more. They play both sides. There are entire businesses inside these companies that are for agencies, not brands. They consult for agencies and charge agencies to participate in reviews. It’s terrible, but if the client is willing to do something, then that’s the client choice.
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