Choosing a marketing agency in 4 steps

If you’re in a leadership role, you’re often faced with navigating turbulent seas. And while your crew (your employees) can help you maintain course and power through any storm, you may encounter situations where you need a little outside help. 

A good marketing agency can give you new capabilities, supplement your crew and relieve your workload, or add a much needed jolt of creativity. Choosing a marketing agency is no small feat either. 

Consider this analogy: the right marketing agency can act like the Mercury Verado boat engine. With 600 horsepower coming from the V-12, it can accelerate to peak performance at lightning speed. On the other hand, a mismatch between an agency and your business can act like an anchor.

So, how do you navigate this crucial choice? How do you avoid being weighed down by an agency mismatch? What questions should you ask them? And where do you even begin? 

Easy. You begin by reading on. 

What you will learn

For this post, I spoke with several colleagues at Funnel, all with years of experience in different marketing roles. Together, we came up with the steps and tips in this post. What we will cover:

• Understand your business needs and define goals to find the right marketing agency.
• Evaluate an agency’s expertise, experience & industry knowledge to ensure success.
• Ask questions about their approach & track record for a successful partnership.

Step 1: Understanding your needs and define the SOW

You might think: what is an SOW?

SOW in this case stands for Scope of Work. In any client-agency relationship, the scope acts as the framework. To create a scope, you need to examine and define what it is you need. After all, there are tons of different marketing agencies out there with their own specialities. They can offer 360 services or focus on one hyper-specific niche. But, what does your business need? 

Let’s imagine that your goal is to dominate search engine rankings and produce compelling content. Then, you may want to look for a content marketing agency with a strong SEO offering. 

Or, if it’s early days for your business and you feel like you lack a brand identity, a brand development and design firm could be the right choice to help you build a marketing strategy and develop your brand.

You’ll also need to make sure that there is alignment on your needs among your key stakeholders. In other words, if you’re the CMO seeking a global brand awareness campaign but your CEO thinks your brand needs to be defined first, you need to do some work.

Define your goals

Once you’ve figured out your needs, it’s time to define goals. 

If you’re looking to own the search rankings with amazing content, you need to confirm what success looks like. Is appearing on the first page of results sufficient, or are you thinking of doubling the number of leads you get from organic search? 

Are you in search of an ad campaign to launch a new product? You’ll need to determine how many units you’re aiming to sell, what an acceptable return on ad spend is, and more. Clearly defined goals allow you to communicate your expectations and ensure the agencies you speak with understand your aims.

Determine your budget

If your goal is to be the top search result on Google, you need to be prepared to spend some serious coin. Setting a budget around your intended activities not only helps ensure your KPIs are reasonable, it helps in selecting a marketing agency. 

You may dream of that world-class global agency representing you, but if you don’t have the budget, you may need to search for a more appropriate partner. 

Additionally, providing your agency with the intended budget up front helps them gain a better understanding of what you need from them. They may want to sell you every service in their portfolio, but an accurate budget will help them tailor their offering to exactly what you need. 

Identify your target audience

Identifying your target demographic is an indispensable element of any marketing strategy. It ensures the marketing agency can create tailored plans that resonate with your audience, leading to maximum impact.

Just as the budget, the target audience can help you choose the right marketing agency. The agency you select should be familiar with your target market and the nuances that drive their purchases. 

Build the brief / RFP

Once you define your business needs, write them down. In detail. This document will later become the brief or “request for proposal” (or RFP) that you will send around to the marketing agencies on your shortlist. This document will provide them with all necessary background information, highlight any relevant insights, define the budget, clearly indicate the goals, and set the desired timeline. 

Once you’ve fully engaged the agency, this brief will transform into your scope of work. 

Step 2: Creating a shortlist

With your RFP in hand, it’s time to start narrowing down the plethora of choices when choosing the right marketing agency. There is a lot to consider here – some quantitative and some qualitative. 

You’ll want an agency that can check every box in your RFP at the right price. However, you also need to make sure there is chemistry between your team and the agency team. Do you have shared values? Do you like the agency’s aesthetic? Are they fun to work with?

So how do you start thinning the field from 10 billion to, say, 10? 

• Peer recommendations: This is often the gold standard. Word of mouth remains one of the most reliable ways to identify quality service providers. Ask business peers, partners, or even competitors about agencies they've had positive experiences with. Their firsthand insights can be invaluable.
• Agency rankings and awards: Many industry publications rank marketing agencies based on various criteria, from client feedback to successful campaigns. Additionally, prestigious awards, such as those from Cannes Lions International Festival of Creativity, can be indicative of an agency's creative prowess and innovation. These accolades and rankings can serve as a reliable starting point, especially if you're aiming for top-tier agencies.
• Google Search: If you prefer working with an agency in your vicinity for closer collaboration, a simple Google search like "marketing agency in [your city]" can yield valuable results. Local agencies might also better understand the local market and its nuances.

When refining your list, consider the following:

• Size and service capability: Ensure the agency's team size and skill level align with your marketing department's needs. Larger marketing departments might require a more extensive account team or highly skilled account personnel. Conversely, if you're a smaller client, you don't want an oversized agency team attending every meeting, which could inflate costs.
• Specialization: A digital marketing agency can help you with different things than a creative ad agency. Delve into their areas of expertise and gauge your initial impressions from their online presence. This will help you discern if they're the right fit for your specific requirements.
• Review their portfolio: An agency’s website should be one of your first destinations when evaluating them. Here, you should find information about their specializations as well as their portfolio of past work. See if they have highly creative ideas for other clients in your industry or a similar one. Also, be sure to look for the results they achieved with that work.

Remember, finding the right agency is a journey. Invest time in it, and you'll reap the benefits of a harmonious and productive partnership.

Step 3: Evaluate agency expertise and experience

Once you’ve assembled your shortlist of agencies, you’ll need to assess just how good they actually are. 

To do that, you need to make a connection. This can mean speaking to the agency over a Zoom call, meeting one of the agency leaders over coffee, going to meet the agency team in their office, and more. When you do meet with the agency, there are a couple of questions to keep in mind: 

• Do they seem authentic? 
• Do they understand your values and philosophy?
• Are they proactive?
• Are they genuinely interested in understanding your business challenges and objectives?
• How have they handled similar challenges in the past? 
• What other campaigns or work from other teams do they find inspiring?

While some of these questions might seem “fluffy,” they can give you a sense of how the agency approaches their work and how they think creatively. 

Creativity and innovation 

Let’s say you have four agencies shortlisted and ready to pitch their concept. They all happen to fit your budget at the same price point. They have similar expertise within your industry. So, how will you choose? 

Often, when choosing a marketing agency, the answer comes down to creativity. Can one agency innovate and bring a new solution that the market hasn’t yet seen? Can they think outside the box and offer fresh perspectives? 

Agencies make their mark based on the creative capacity of their talent. And that is a large portion of what you will actually be paying them for. This isn’t just limited to branding and advertising agencies either. Creativity is just as important when selecting a content or SEO agency.

Industry knowledge

Evaluating an agency’s knowledge of your industry is  necessary  to confirm their comprehension of your niche and their ability to devise effective strategies. A specialized agency with expertise in your industry will understand the specific challenges and opportunities that come with it. This means they’ll be better equipped to craft marketing strategies and messages that resonate with your target audience, making your campaigns more successful.

Additionally, it’s crucial for the agency to stay up-to-date with the latest trends and advancements in the industry, so they can continuously refine their approach.

Step 4: Make your decision and start collaborating

Once you’ve shortlisted and evaluated potential agencies (which could include a pitch process), it's time to decide. Reflect on your findings and trust your instincts — the right choice often feels like a natural fit. If you’re still unsure, consider a trial project to gauge the agency's capabilities. 

Transparent pricing and budget considerations

Clear-cut pricing and budget considerations are significant when selecting a marketing agency. Here are some factors to consider.

• Hidden costs can lead to unpleasant surprises, so make sure to inquire about any additional fees or charges.
• Pricing transparency is essential, so ask for a detailed breakdown of costs and any potential additional expenses.
• Ask the agency up front about how any deviations from the scope of work will be handled. Ask at what point a requested change requires additional spend. 
• If a certain project needs to be expedited, ask about any upcharges for priority or rush service.

Remember the old saying: there is good, fast, and cheap. You may pick two.

Being forthright with your agency partner about where you place your priority (quality, speed, or spend) will help set expectations for everyone involved, leading to a more successful partnership. 

Questions to ask a potential agency partner

Posing pertinent questions to prospective agency partners can aid you in determining their compatibility with your business. You may want to ask the following questions:

• How do you typically measure success? (Keep in mind both their tools and what KPIs they think are most relevant for your type of needs)
• What is your preferred method of communication? 
• How do you like to receive feedback?
• What tools do you use? (Make sure any assets are delivered in formats you can use.)
• What is your favorite SEO strategy / ad campaign / activation / concept in the market today?
• How do you handle changes in scope?
• What do you do when things go wrong?
• What is your ideal project / client?

Frequently Asked Questions

What to look for when choosing a marketing agency?

When choosing a marketing agency, look for specialization, sector experience, cultural fit, track record, commercial terms, goal and objective setting, services offered, culture and communication, budget, creativity, and results that align with your goals.

Should we do a pitch to find the right agency?

Deciding whether to conduct a pitch is a significant consideration in the agency selection process. Here are some points to consider:

• A pitch allows agencies to address your specific brief by showcasing their approach, creativity, and strategic thinking tailored to your needs.
• While pitches can provide valuable insights, they also require resources from the participating agencies. To ensure fairness and commitment, consider compensating agencies for their time and effort. This not only acknowledges their investment but can also result in more thoughtful and dedicated pitch presentations.
• Instead of a full-blown pitch, you might opt for an interview-style case discussion. Pose a strategic question or present a challenge, and ask the agency to share their perspective or outline how they'd approach the solution. This method can offer a glimpse into their strategic thinking and problem-solving capabilities without the extensive resources a full pitch demands.
• The more precise and targeted your questions or challenges are, the clearer the insights you'll gain about the agency's capabilities and approach.

Is it worth it to hire a marketing agency?

A marketing agency can be a great addition or complement to your team. They can also offer fresh perspectives on best practices. Their ability to work across industries with a diverse client roster allows them to discover unique tactics and methodologies that drive results. 

How do I choose the best agency?

When choosing the best agency for your needs, consider their portfolio, cost of services, reputation, client options and customer service.

Make sure to evaluate and compare all the proposals, references, and testimonials to make the best decision and ensure a good fit based on shared values, size and budget.

Read next: 5 tips for employer branding

Disclosure: The images in this article were created using generative AI.