No less than 97% of the agencies had experienced procurement involvement in 'contract and remuneration issues'. This was confirmed by 48% of clients. The influence of procurement on the client/agency relationship will continue to rise. There is no doubt the marketing function is under enormous pressure to demonstrate return on investment. Eighty-six per cent of the agencies in our survey believe they are better value than they were five years ago; 60% of clients agreed with them. But this still leaves a third of clients saying they are paying comparatively more now.

So how is agency performance being evaluated and compensated? Ninety per cent of clients said they formally evaluate relationships with at least some of their agencies. Most also felt that this was an effective way of improving relationships. Agencies see this differently. Only half thought that relationships improved with even 50% of clients.

One factor may be the lack of mutuality: 56% of agencies reported that mutual evaluations take place with only half their clients. There is no general consensus on using a performance and output-based system of agency remuneration. While nearly two-thirds of the companies surveyed claim to include performance by results in the remuneration structure, only 27% of agencies said half or more of their clients offered this form of incentive. A more accountable and dynamic solution would help both agencies and the marketers who pay them.

We asked clients and agencies whether multinational agencies deliver better all-round performance than local agencies. Sixty-seven per cent of clients said no, and a further 29% were neutral. This included many clients using these very agencies. The response from agency bosses, including many working inside the multinational networks, was surprising - only 23% felt that the global networks do a better job.

Many agencies making their mark in new business are local agencies - flexible, with a strong creative product and high levels of service. They may benefit from not having the cumbersome machinery of some of their network competitors. Nonetheless, network agencies do not always merchandise their advantages to best effect.

Views differ widely when it comes to assessing whether clients really expect their creative agencies to offer an integrated service. Fifty-three per cent of agencies claimed to offer a 'one-stop shop'. All others said they work with partner agencies to provide integrated coverage. Most clients want integration, but this does not necessarily mean that they want it all from one agency. Forty-three per cent of them disagreed that managing multiple agencies was a significant drain on agency resources.

Finally, we looked at pitch practice. In a 12-month period, 70% of agencies participated in at least 10 pitches. This high rate of churn seems to be the norm, but what are the implications for the resource left to service existing clients? According to our survey, 64% of clients find pitching to be of real value to the business, but only 14% got work they could run immediately. Clients are almost as enthusiastic about pitching as agencies. Should agencies be worried?

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