As is obligatory for government agencies, Auckland Council is reviewing its various partnerships with its agencies after three years.
Following the previous review in 2014, Auckland Council appointed DDB as its lead creative agency and PHD as its media agency, supported by Goodfolk (digital) and Alt Group (design).
For this year’s pitch, Auckland Council is, however, taking a slightly different approach to its strategy.
Until now, Auckland Council, ATEED and Auckland Transport have operated as three disparate arms, each with its own set of agency partners.
But this is set to change with Council instead introducing plans for a panel of creative, design and digital partners that can be called on to service any of these arms.
As a corollary, the agencies working with ATEED (Colenso BBDO and 99) and Auckland Transport (Work Communications and JWT) have also been required to go through the RFP process to qualify for inclusion on the panel.
As part of the RFP, agencies were asked to work on a hypothetical project involving the creation of single card to be used across all Auckland public services, including transport, pools and libraries.
The agencies were asked to design the card and develop a creative and media plan for the roll out in a bid to show Auckland Council the extent of their capabilities.
Given the size of the account, it has attracted interest from a number of agencies.
One source revealed to StopPress that the shortlist of applicants happens to be “more of a long list”, which is thought to include DDB, Ogilvy & Mather, Clemenger (a joint application by Colenso and 99) and Work Communications, among others. FCB is not thought to be in the running.
Auckland Council head of brand and channel Debbie Lowe explains the move toward a panel was made to make the Council’s size work in its favour and to deliver value for money for ratepayers, who aren’t backward in coming forward when it comes to Council’s spending.
“It was identified that setting up a panel of agencies to service the needs of Auckland Council, Auckland Transport and ATEED could bring about efficiencies,” Lowe says.
Auckland Council is a relatively big spender, with one source estimating overall spend to be in the vicinity of $40 million per annum across all three arms. Like many big organisations, Council has, however, reduced its agency spend in recent years by taking some of its work in-house, and executives will hope to further cut down the overall figure with the latest change.
The idea is that rather than having a single creative agency to work on an account, Council will be able to tap into the services of the suitable (or, perhaps, most affordable) partner when necessary.
One source, who preferred to remain anonymous, compared this approach to the All of Government panel introduced in 2013, which led to the appointment of a panel of 37 services providers. (as one of the agency heads said rather poetically at the time: ‘What the fuck?’)
During the launch of this panel, the Ministry of Business, Innovation and Employment openly admitted that the new approach was driven by the desire to reduce costs.
At the time, MBIE anticipated that the introduction of the panel would lead to a ten percent reduction of the total advertising bill.
Similarly to the All of Government application process, agencies interested in working with Auckland Council were asked for a rate card breakdown of how much they charged for their services – and this will no doubt influence which agencies decision makers decide to work with.
Cost over strategy?
While the panel scheme might make fiscal sense in theory (at least to Auckland Council), several industry sources have expressed concern about how it might be put into practice.
Auckland Council has until now appointed a lead brand agency to guide its strategic direction, but it’s unclear how these responsibilities will be divided across the panel.
“It’s all good if you’re a bean counter trying to save money, but not so much if you’re trying to develop a strategic voice to drive change in a major city,” one source says.
The source says the approach is largely cost-driven and anticipates it might lead to Auckland Council squeezing the margins on agency work by pitting providers’ prices against each other.
It’s plausible that providers may be required to pitch against each other for bigger projects, leading to costs being pushed down for Council, but this means agencies will also have to carry the cost and inefficiency of pitching for each project, further reducing the profitability of the partnership.
“There is a risk that agencies might become fatigued with having to pitch so much,” the source says.
Asked whether the agencies on the panel would be required to pitch for all major projects, Lowe wouldn’t comment.
“Due to the fact that we are still in a procurement process, we are not in a position to answer any specific questions about how the panel of agencies will work until this process is completed,” she says.
“As a group, we believe there will be strong strategic benefits that we can all derive from this new arrangement.”