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This question has been answered, and points have been awarded.

Retainer Fees? What's Reasonable?

Posted by trice on 125 Points
We are a 61 year old, 120 person engineering firm that is close to hiring our first advertising/marketing agency. What would a reasonable monthly retainer fee be? What specific questions should we ask of this agency to help us make our decision?

  • Posted by anthony zapata on Accepted
    Great questions! The retainer should be based on the amount of work you are going to need your agency to perform. You need to figure out what your overall goals and objectives are and you need set a realistic marketing budget in place to accomplish those goals. You can find any "agency" to work with in any budget small or larger. The problem is, you get what you pay for. So first start by asking yourself these questions;

    1.) Do you want a traditional marketing agency or an online marketing agency or both?
    2.) Do you need them to be local or can they be out of your geographic area?
    3.) Why after 61 years do you feel you need a marketing company now? Make sure you are hiring one for all the right reasons.

    I would highly recommend you find at least 4 agencies you are comfortable with and then make the investment to bring them all in for a face to face meeting. Even if they are going to be out of state, it's always good to meet face to face since you are going to be making a hefty investment in an agency.

    As for what to ask the agency. Well that boils down to what's important for you. For instance, are you going to want customized reporting and can they do that? Do they need to be able to handle many services under one roof or is it okay if they have partners? ie... web design, print services, audio/video capabilities, search marketing etc.... I would also ask what kind of success they've had working with small or medium sized companies. The reason i say this is because every agency is going to spit out a large house hold brand they work with. However, i believe you can get a sense of how an agency really is by how they've been able to affect their smaller clients. Smaller clients have smaller budgets, therefore it take a lot more creativity to market them since you have limited resources. Larger companies have huge budgets so you can do pretty much anything and come out some what successful.

    anyways, i hope this helps if even a little. I have my own agency out of Dallas and would be happy to speak further with you about your needs.

    Good Luck!

    Anthony
  • Posted by Frank Hurtte on Member
    Trice,
    You need to think about what you want them to do for you. At this point in your carreer... (your other post gives a little more background) .. I absolutely, positively recommend you delay signing up with anybody.

    I would suggest putting somebody on board only after you have figured out a long term or at least middle term game plan.

    Marketing people are very convincing. You don't want to be convinced yet...
  • Posted by Frank Hurtte on Accepted
    Trice,
    You need to think about what you want them to do for you. At this point in your carreer... (your other post gives a little more background) .. I absolutely, positively recommend you delay signing up with anybody.

    I would suggest putting somebody on board only after you have figured out a long term or at least middle term game plan.

    Marketing people are very convincing. You don't want to be convinced yet...
  • Posted by NuCoPro on Member
    I've got to go with Frank on this. You are WAY TOO early in the process to retain a marketing agency. Figure out what you want to accomplish from a strategic standpoint. Then determine what you need help with BEFORE talking to marketing firms.

    Also, seek out colleagues at other engineering firms who are not direct competitors and ask for their advice on how to approach marketing your firm.
  • Posted by trice on Author
    Anthony, Frank and NuCoPro:

    Thank you for the quick responses. I appreciate the counsel on not commiting to quickly to an agency, but here are my thoughts:

    I am starting from ground level in this role at this company. (See my other posted question for additional info) With the incredibly low level of experience that I have, and no previous marketing activity in the company, beyond the generation of sales collateral, to learn from, I am finding myself in need of assistance to even create the list of things I don't know yet!

    The agency I have been speaking with has a very experienced PhD on staff from the state university in town who appears to be well regarded in our part of the country. He also has experience working with professional services firms such as ours. I have developed a good rapport with him and have already formally engaged him for several hours of consultation to help me begin to develop my initial plan. I have been thinking that I should go ahead and sign them up as our agency of record for just one year to help get me through my initial planning and to help score a few quick successes to offer up to the senior executives of the company. Once I have a better feel for our initial, mid, and long term plans/goals, I could then begin to shop for an agency that would better meet those needs, or possibly "in-source" the whole effort if appropriate.

    I am completely open to your thoughts and feedback........
  • Posted by MONMARK GROUP on Member
    Very interesting that after responding to your first post, with similar advice, pop...up comes the other. Of course, we will not post our retainer fees online, but if you contact us off-forum, we would be more than pleased to present a proposal for your review.

    Our contact information can be obtained by clicking on W.M.M.A. above. Thank you.

    Randall
    WMMA
  • Posted by Bill@ideawerks on Member
    Trice,

    Having worked with two engineering companies, I believe you really need to sit down with management first and understand their strategic direction. The question you need to ask them is - why did you hire me?

    Was it for strategic marketing (setting the direction for the firm) or to promote the status quo? From this post, it seems like the latter.

    If you don't gain this understanding up-front, all your plans could be for not if they are not in sync with both the culture and mgmt's belief system. Believe me - I've lived it several times....
  • Posted by trice on Author
    Thanks again Bill. The strategic direction is primarily expanding our current list of clients utilizing our existing lines of business. We are however, as a secondary effort, developing 3 new lines of business that will eventually need to be positioned and promoted to our existing and new client base.
  • Posted by NuCoPro on Accepted
    Why not just continue to use the services of the guy you're working with on a T&M basis for now. There isn't any need to engage the firm as your 'agency of record' at this point, nor do you know if the entire firm is a good match.

    Honestly, I don't know that you will ever need to get to that point, unless you are planning a much broader and more expensive marketing effort that what it seems from your comment. Why not just use a marketing firm on specific projects and see how it works out before making a commitment that you might need to back out of.

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