Now I've seen it on so many occasions. Client calls for a proposal for engagement with the agency. The latter sends in a high quote thinking the client will bargain and bring it down.
Irrespective of whether the agency makes a reasonable/desirable amount or not, this phenomenon clearly does two things.
- The business and activity of communication gets a bad name. The significance of communication – as the most critical element of business according to me – gets diluted. Clients think agencies make money out of blabbering anything. They think agencies don't deserve what they quote. They come to think communication is just another function; their business runs on something else.
- Agencies shift the focus from the value they offer. The bargaining process often leads to loss of business and, in turn, an opportunity to build some good brands.
On the other hand, when agencies do charge a very attractive fee (which means 'less' fee in the client's mind), clients look down and think, "they aren't that great, that's why they quote so low."
No doubt, such attitude towards agencies does harm the clients too on quite a few occasions.
It's a tough nut that agencies have grown. Clients don't have the teeth to crack it very often and agencies are at it making it stronger.
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