The Price of Success

Six agency pricing factors to reflect value and drive growth

The report defines the challenges, competitors, complexity and commercial reality facing businesses and how using a wide range of pricing models can drive agency growth.

It is not a new question, but it is a pressing one. Since the ground-breaking impact of the IPA’s Magic and Logic paper more than 10 years ago, the issue of pricing services properly has become more urgent.

Pricing models need to be part of a clear pricing strategy. Prices need to reflect the value to the client and this happens if services and products are better defined and aligned to client needs and the value that they each deliver. In the future, the price of agency services and products is less likely to be directly or wholly related to the ‘time and materials’ used to make and deliver work, but rather to the value generated.

Pricing for Success explores the opportunities and risks to be considered when setting and agreeing pricing for agency services with clients. The authors identify six key factors in pricing agency services: Client needs; Activities, Services & Products; Value attribution; Risk; Relationships; and Commerciality. All of which will help to build greater trust between agencies and their clients and ensure both have a better chance of success.