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Agencies Bend to Client Whims

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NEW YORK Red flags abound in ongoing reviews for brands such as Amazon.com, Zappos.com and Current Media. These include unusually long lists of agencies presenting work (nine shops for Amazon, 12 for Zappos), a request to own the pitched ideas (Amazon) and relatively small fees compared to the scope of the work (Zappos and Current). What's more, Amazon encouraged agencies to go beyond storyboards in their presentations and Zappos asked for creative concepts in its initial RFP.

But rather than walk away, many agencies are jumping in, even while acknowledging flaws and irregularities in how these clients are conducting their searches.

Why? According to consultants and agency leaders, agencies, suffering from client fee cutbacks, are starving for new revenue. Also, agencies believe that some brands are "sexy" enough that the red flags can be overlooked or downplayed.

From the client side, some marketers may be exploiting hungry agencies or simply don't know better, given that they're not using search consultants and don't currently have lead agencies.

"It's client naïveté. It's procurement [executives] trying to show value," said an agency new business chief. "But, at the end of the day, you can always say, 'No.'"

Certainly, that's a core tenet of prospecting preached at new-business conferences for years. The theory is that client reviews are as much about agencies selecting clients as clients picking agencies, and that selectivity has its rewards. The hurly-burly of the current marketplace, however, can skew the perspective of even savvy agencies, particularly smaller shops struggling to survive.

"The adage, 'A principle isn't a principle unless it costs you money' has never been more true," said Jason DeLand, a partner at independent Anomaly in New York, but, he noted, "we're talking about the very nature of survival for some of these agencies."

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