EVALUATING

AGENCY
PERFORMANCE

HOW-TO GUIDE
 Evaluating Agency Performance
HOW-TO GUIDE

Evaluating agencies can help you gauge the performance and alignment of key partners.
To create an effective agency performance evaluation, evaluations must occur on a regular basis.

There should be a neutral evaluator, a consistent format, 360-degree reviews, and a clear follow-up
plan. This guide will explain why you need to evaluate your agency, what criteria you should use,
and how to conduct an effective evaluation.

Download the Demand Metric Agency Performance Review to help you leverage agency
review best practices.

Why is this Important?

The Association of National Advertisers (ANA) reports that 82% of companies regularly review the
performance of their marketing agencies. It is important to regularly evaluate agency perform-
ance for the following reasons:

1. Improve Resource Allocation — when evaluating agencies, a regular assessment can help you
determine what is working well and why. The companies that conduct regular assessments are
likely to identify successful and under-performing aspects of their agency relationships. This will
allow a company to allocate efforts and resources more efficiently.
2. Ensure Alignment — an evaluation can ensure that your marketing agency’s work is aligned
with your company’s overall marketing strategy.
3. Budget and Measure ROI — a regular agency evaluation can help you understand the total cost
of agency services, and will help you calculate Return on Investment (ROI).
4. Motivate Under-Performing Agencies — the companies that plan regular assessments are
more likely to identify successful and under-performing parts of their agency relationships.
This can lead to constructive conversations and improved performance.
5. Encourage Realistic Expectations — A regular agency evaluation can help you ensure that your
company and its agencies are clear on expectations and are committed to the relationship.

2 EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE

Key Evaluation Criteria
When evaluating agency performance, both qualitative and quantitative measures should be used.
The most common formal agency evaluation criterion includes:

1. Creativity and Innovation — agencies should generate creative and innovative ideas to help
your company’s marketing strategy for the long-term.
2. Execution — a marketing agency should have a clear understanding of expectations and be
regularly meeting these objectives. While your team should be involved with its marketing
agency, it should not be required to spend an excessive amount of time to ensure that
expectations are met.
3. Financial Stewardship — when working with a marketing agency, it is important that a positive
ROI is realized. Agency partners should do everything possible, strategically and judiciously,
to create work that will have an impact on your bottom line.
4. Quality of Deliverables — agencies that do not deliver extremely high-caliber work should be
replaced or closely evaluated to get up to the standard you require.

Download the Demand Metric Agency Management Playbook to leverage agency

management best practices.

Bottom Line
Regular agency performance evaluations allow you to determine successful and underper-
forming aspects of an agency relationship and identify areas for improvement. If you are not
currently evaluating your agencies on a regular basis, consider implementing this new process in
your organization.

3 EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE

 Action Plan
STEP 1 - Conduct Evaluations On Regular Basis

Conduct
Implement the Agency
1 Evaluations
On Regular
Basis
Selection Tool for Fast
Evaluation

Use a Neutral
2 Evaluator Companies should conduct
formal agency performance
evaluations on a regular
basis, such as quarterly or
annually.
Consider Doing
3 Mid-Term Reviews If you are looking for more
insight into agency selec-
tion, use our Agency
Selection Tool to evaluate
and compare different ad
Maintain a agencies by analyzing them
4 Consistent
across a set criteria.
Format

Consider
5 360-Degree
Evaluations

Agency Selection Tool

VIEW RESOURCE
Create a Clear
6 Action Plan

4 EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE

 Action Plan
STEP 2 - Use a Neutral Evaluator

Conduct
Source a Neutral Point
1 Evaluations On
Person to Assess the
Regular Basis
Evaluation 

2 Use a Neutral
Evaluator
A trusted, neutral point
person should be assigned
to the evaluation. This is
important because the
person should be focused
Consider Doing on objectives and metrics,
3 Mid-Term Reviews as opposed to personal
relationships.

Maintain a
4 Consistent
Format

Agency Compensation Audit Template

Consider
5 360-Degree
VIEW RESOURCE
Evaluations

Create a Clear
6 Action Plan

5 EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE

 Action Plan
STEP 3 - Consider Doing Mid-Term Reviews

Conduct
Avoid Unnecessary
1 Evaluations On
Surprises with Mid-Term
Regular Basis
Reviews

Use a Neutral
2 Evaluator
Companies that opt for
an annual review process
should consider having a
more informal mid-term
review at the 3 or 6-month
Consider Doing
3
point to avoid any surprises
Mid-Term at year-end.
Reviews

Maintain a
4 Consistent
Format

Post Project Evaluation

Consider VIEW RESOURCE

5 360-Degree
Evaluations

Create a Clear
6 Action Plan

6 EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE

 Action Plan
STEP 4 - Maintain a Consistent Format

Conduct
Consistent Formats
1 Evaluations On
Provide Clear Performance
Regular Basis
Data

Use a Neutral
2 Evaluator
A consistent format should
be used across all agencies,
although specific questions
can be varied for different
agency types.
Consider Doing
3 Mid-Term Reviews

Maintain a
4 Consistent
Format Agency Performance Review

VIEW RESOURCE

Consider
5 360-Degree
Evaluations

Create a Clear
6 Action Plan

7 EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE

 Action Plan
STEP 5 - Consider 360-Degree Evaluations

Conduct
Enhance Your Assess-
1 Evaluations On
ments with a 360-Degree
Regular Basis
Evaluation

Use a Neutral
2 Evaluator
Use our Performance
Review Template to create a
360-degree evaluation that
includes multiple perspectives,
such as the agency reviewing
Consider Doing themselves, the internal project
3 Mid-Term Reviews manager, and an executive
decision maker.

This style of review opens up

agency performance appraisals
Maintain a to greater depth and breadth of
4 Consistent feedback, and can provide more
Format insight to ensure more accurate
and effective assessments.

Consider
5 360-Degree
Evaluations

Agency Performance Review

Create a Clear
6 Action Plan VIEW RESOURCE

8 EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE

 Action Plan
STEP 6 - Create a Clear Action Plan

Conduct
Leverage Your Agencies
1 Evaluations On
with Set Action Plans
Regular Basis

Following the review

Use a Neutral
2 Evaluator
process, work with your
agencies to create action
plans that include areas
for improvement and a
commitment from them to
meet your expectations for
Consider Doing
3 Mid-Term Reviews
future performance.

Maintain a
4 Consistent
Format

Agency Alignment Strategy Workbook

Consider VIEW RESOURCE

5 360-Degree
Evaluations

Create a
6 Clear Action
Plan

9 EVALUATING AGENCY PERFORMANCE HOW-TO GUIDE

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