Money (11)

Deciding on your marketing agency partner on cost alone is not just a false economy, it could damage your brands, says James Rix, Founder, StreetPR.

I’m ALWAYS surprised when clients talk to me about price first. I'm also always surprised when they choose their agency based on price.

If you’re reading this, then I’m assuming you have your own company. I'm also assuming that you don't hire people based on who is offering to do the job at the lowest price – at least, you wouldn’t do it more than once. Being a successful entrepreneur means learning from your mistakes…

There’s always someone willing to try something – a "Have a Go Harry" type who can undercut everyone, because he learnt the trade over three pints in the pub. But are you the person who hires Harry?

You get what you pay for, and it’s a sad fact, but prices for everything have gone up in the last year or so… Whether it’s because of the global economy or the impact of Brexit doesn’t matter: what matters is that at the end of the day, if you want a job done well, you should be prepared to pay for the right people to do it for you.

Like all things in life, if you want great then you have to put some money behind it. If you don’t believe that, then you’ll never understand why Paris-St Germain is prepared to pay Barcelona £198 million for Neymar. Hey, maybe Arsenal could win the league this year by hiring some locals and fielding them against the £100,000-a-week football gods.

What’s important isn’t cost, it’s value for money. To me, that’s so obvious I shouldn’t have to explain it: but let’s put value into numbers so we’re all speaking the same language. Let’s be honest – if you’re in marketing, it’s all about Return on Investment (ROI).

Let’s say you spend £100 for 10 hours work from a staffing agency and see 1% ROI, that makes your CPA £100 PC.

But what if you did a little more research and looked past the initial price and decided to pay £150 for 10 hours to a company that was clearly more experienced. As a result, you get a 3% ROI, which makes your CPA £50 per customer. That means your campaign is twice as successful, despite you apparently having to spend more initial capital.

The really disappointing thing is I hear people complaining that "face to face" marketing doesn't work. That’s total crap.

I know what you’re thinking: “James, you’re the MD of a Street Marketing company – you’re always going to say that.” And you’re right, I am always going to bang the drum for face to face marketing (particularly when I get the chance to talk to you face to face!). If I didn’t believe in it, I wouldn’t be running a company that offers it.

But don’t just listen to what I’m saying – look at what companies like Deliveroo, Hello Fresh, Uber and the like are doing. They are some of the most focused CPA marketers out there, and they invest heavily in face-to-face brand ambassadors to get their messages across to their target markets. I know that as a fact, because we work for them all.

We’re not cheap; we are awesome value.

We are awesome value because we pay our staff well, we invest in their training, we have full time quality control officers and trainers, we have an amazing (but not flash) office in Old Street for training staff and we are dedicated to our clients’ needs.

No-one in my team is cheap, but they are all excellent value... At least, they were – they’ll probably be queueing up asking for pay rises once they read this!

Joking aside, we made a commitment at the start of this year to increase how much we pay our promo staff. That’s because in my experience paying people 30% to 50% more doesn't increase performance and results by 50%, but by 200%! Staff are more loyal, more keen and value us far higher than any other company...

Now that’s what I call a Return on Investment.

With the increase in the costs of living and the HMRC changes to self-employment, it is now more expensive than ever for a promo staffer to be a promo staffer. In order to maintain our great value, we have to price ourselves smart – in order to pay our staff well, train them, educate them and deliver you quality results and unbeatable ROI.

Still, if you want to get a "company" that clearly forward onto a mobile, who have no insurance, no office or a working from a cafe, who do no staff training and have no idea what ROI, CPA, CPC means – or that ignoring the new HMRC rules lays you, the client, open to being fined – then I highly recommend "Have a Go Harry's Promo People." You’ll always find him in the corner of your local boozer…