How to Evaluate the Performance of a Marketing Agency

Skeptical business owners and administrations often ask me how they can evaluate my performance as a marketer. I think this is a straight and fair question, especially for businesses weighing the cost of my services against doing their marketing in-house – after all, we all need to have some idea of how to measure our ROI. I have been on both sides of the spectrum – as the client of an agency in the past, and currently as the service provider – and can offer you a few suggestions on how to evaluate the performance of your agency.

1. Develop SMART goals for your relationship.  SMART stands for Specific, Measurable, Attainable, Realistic, and Time-based.  If your goals and expectations are unrealistic, chances are you’ll be disappointed with the results, regardless of your agency’s work quality.  Remember that marketing is an ongoing effort, and not a one-time wonder pill.
2. Work with an agency that practices what they preach. Does your agency apply the marketing practices they sell to their own organization? If you’re not impressed by how the agency present themselves, don’t bother signing that contract. You don’t want to hire professionals who are trying to play catch-up in their own industry.
3. Select an agency that invests in the professional development of their team. When you hire an agency, you’re hiring a group of highly qualified and specialized professionals to become an extension of your internal marketing department.  To find out if the team you’re hiring is experienced and well-trained enough to handle your account, interview them directly.  If you’re not impressed by their abilities and qualifications, walk away.
4. Opt for a holistic marketing approach. Holistic marketing goes way beyond top-of-the-funnel traffic generation, all the way to lead cultivation, conversion, relationship management, and business growth strategies.  Any agency worth your dime will create a comprehensive marketing plan tailored to your unique audience, needs, and goals, instead of offering a one-size-fits-all solution with display ads, radio and TV spots, and print ads (the easiest way for them to make good money without much effort). These channels can’t be measured effectively, so watch out if you find yourself being pushed in that direction.
5. Measure their professionalism. To rate the level of professionalism of the team you’re hiring, evaluate every step of your own sales cycle in finding the agency, from the time you first engaged with them. Take careful note of how soon the agency responded to your emails and phone calls, how they conducted in-person meetings, and how clear and detailed their proposal of service was. Then, ask for a contract detailing deliverables, cost, and performance measurements. All of these things will offer valuable insights into what you can expect from the relationship.
6. Ask for client references closely related to your industry. You would ask for references if you were hiring a new employee, so do the same when hiring an agency.  Talk to their current and past clients, and ask specific questions about metrics and how those clients have been able to measure their relationship with the agency – including quality of output, customer service, technical support, regular reports they receive from the agency, and of course, how the agency has helped them grow.
7. Calculate the value of the relationship in dollars. If you can hire a team of highly qualified professionals for the price of one employee, that’s a clear benefit. When contemplating the cost of hiring an agency, think of the quality of the output and the opportunities that a team of specialized professionals can offer, compared to one great employee who could do everything in-house (and let’s face it, nobody is good at everything).  Also, calculate the agency fee separately from the cost of advertising, because these are in fact two different costs – one for the professional service, the other for broadcasting this professional service.  If the total amount doesn’t meet your budget, consider taking baby steps and hiring the agency to handle your marketing priorities first.

Every successful brand you can think of has an in-house marketing team, but the value of an outside perspective spurs them to partner with an external agency as well. Working with a qualified marketing agency can help your business grow a lot faster than trying to do everything in-house – and being able to evaluate that agency’s performance can ensure that you make the best decisions for your goals and resources.