We aim to make this the best guide for why and when you should get a marketing retainer - and are always looking for more great questions to answer. So if you think we missed something, feel free to reach out to us and we will add to this resource!
Now let’s get started!
What is a Marketing Retainer?
Have you ever wanted a full marketing department for your business? A marketing retainer might be the key.
A marketing retainer is essentially an agreement between a company and a full-service marketing agency that includes a monthly or quarterly budget in exchange for a wide variety of services. Retainers tend to be over longer time periods and are not project-specific. This long-term relationship allows an agency to become very familiar with a brand and help execute long-term business goals.
Sometimes you will hear a retainer agency referred to as an “Agency of Record” (AOR). This means that a marketing agency is the “official” or “main” agency for a company or brand.
This AOR, or retainer, relationship allows a company to instantly tap into the resources of an experienced and skilled marketing department without having to build one themselves.
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A business will enter a contractual relationship with an agency and, most often, agree to a set budget for monthly services. If one of the services that the agency is being retained for includes pay-for-click (PPC), traditional, radio or any other form of paid advertising, there will also likely be a discretionary “advertising spend” budget or component within the agreement.
Early in the relationship, an agency will work with the company to determine the strategic goals it has been retained to execute.
Common goals could include:
Build brand awareness
Increase website traffic and inbound-leads
Based on the goals set out by the company, an agency will then jump into action and start planning a strategy and tactics to accomplish those goals within the budget of the retainer.
The agency is also “on call” for any immediate needs or short-term goals of the company. Being treated as a retainer client allows a company to expect quicker turnaround times and enjoy some “line-skipping” in terms of when requests can be fulfilled.
What are the benefits of a marketing retainer?
There are some projects when a marketing retainer is not a good fit. But in most cases when a company is needing general marketing support, a retainer relationship is a win-win for both parties.
Benefits for Businesses
Businesses know what to expect for an invoice every month for services. This allows for better budgeting and forecasting. It also grants the flexibility to amortize short-term marketing campaigns over longer periods of time.
As a retainer client, a company can expect a bit of “line jumping” when requests are made. An agency will usually try to shuffle requests around if possible to accommodate its long-term retainer clients. It also knows that it needs to set aside an allotted amount of resources every month to dedicate to a specific client.
Front of Mind
More important than being front of the line is being front of mind!
In a retainer relationship, a marketing agency moves from simply taking orders to coming up with new ideas and ways to help move their client’s business forward.
Businesses that form a retainer relationship with an agency will often incur a lower hourly rate for services. More valuable than that - the agency will start to have a deep understanding of the business and be able to provide stronger and quicker service as a result. Even further - as the relationship continues to grow, so does the efficiency.
Without retainer, marketing decisions usually fall on one person in a SMB. If they leave, get sick, go on vacation, or get hit by a bus - everything stops. With a marketing retainer, the agency knows enough to keep things running without that person.
Benefits for Agencies
Nothing makes a team at an agency happier than delivering great work and great results. A retainer relationship allows a team the time required to sink their teeth into the work and deliver their best work. A retainer also allocates a budget to spend more time doing research and applying an analytical approach to projects, driving a better end product.
An agency can focus more on serving clients instead of always seeking new business. When an agency can spend less resources on seeking out new business, it can invest them in delivering better results for its clients. Plain and simple.
Having retainers in place allows an agency to better plan its allocation of resources for different campaigns and initiatives because it will know what work is approaching in coming months. This allows for a smoother workflow and quicker turnaround times for incoming requests.
What services are typically included in a marketing retainer?
Media Planning and Management
Media planning involves taking a company's advertising budget for a year and allocating it to the mediums and channels that provide the best results. This includes getting quotes from media vendors and negotiating rates. Tired of of taking cold calls from countless advertisers pitching their product? Then this service is for you. Next time they call, just say “send your details to my agency of record”.
Content marketing is the cornerstone of any modern marketing strategy. It helps drive traffic to an online property using a variety of marketing channels and, more importantly, convert visitors to customers. We talk about content marketing a lot at Csek Creative. You can read some of our more popular blog posts here, here, and here.
Some say print is dead. They’re wrong. Traditional print advertising can still be effective when the right message is paired with the right channel. An agency can help identify traditional platforms that still provide value. This isn’t just limited to “print” advertising either, and can include both radio and television!
Strategic Planning and Campaign Focused Thinking
Having a long-term relationship with an agency allows it to contribute more resources to coming up with unique ideas and strategies that align with business goals. This includes cooking up creative campaigns and messaging to help a company accomplish its marketing goals.
Website Conversion Optimization
An agency can play an important role in helping make sure a company’s website is operating in top form. Using a data and analytical focused approach, it can review a company’s website and look for places where potential leads and sales are being lost - and implement strategies to minimize the losses.
More than 88% of online shoppers incorporate reviews into their purchase decision. Online reputation management (and acquisition) is important for any business. An agency has the resources to allocate team members to keep any eye out on social media channels and review websites for negative commentary around a brand - and address as necessary.
Search Engine Optimization (SEO)
Search Engine Optimization is the practice of making changes to a company’s website in an effort to improve its ranking in search engines such as Google. This includes rewording content for targeted keywords and topics, reducing the amount of bad links on the site, making sure the website follows best standards in regards to mobile design - and so much more.
Paid Digital Marketing Campaigns
Pay-Per-Click (PPC) campaigns have become standard operating procedure for many brands. Not only do they allow companies to immediately position in specific searches on Google, but also allow very targeted advertising on various social media platforms. An agency (usually after creating a media plan) will help a company craft targeted messaging and navigate the various channels to find the best return on investment.
When to use marketing retainer
There are a number of different reasons for getting an Agency of Record. Any of the below would be a good indicator that you may benefit by putting an agency on retainer.
Need to immediately increase marketing capabilities
Spend more than $12,000 annually on advertising and other marketing initiatives
Need quick turn around times from your marketing partner
Have many ongoing needs for creative assets and deliverables
Need help managing the different media platforms you advertise on
Have a project in mind that has a long (6+ months) timeline and covers a broad set of services
Are currently involved in, or would like to start, an ongoing content marketing campaign
When NOT to use a marketing retainer
Just as there are scenarios when it is a good idea to enter into marketing retainer relationship, there are plenty of reasons not to. Some of the reasons below outline times where you may want to pursue a traditional project-based agreement.
Have a limited budget for marketing activities
Have a very specific project or service requirement
Don’t have very many ongoing marketing needs and requests
Don’t spend much on advertising in different mediums
How much does a Marketing Retainer cost?
Ultimately, there is no golden number to quote as a budget - it is a very wide range. Every business and industry is different. That being said, retainers for small to medium sized businesses will usually start in the $12k to $24k a year range. In addition to the fee paid to an agency to retain its services, there is usually an additional “spend” component that is also used for placing advertisements in different mediums.
Once upon a time, marketing agencies made their money by significantly marking up the cost of the advertising they purchase from advertising channels (like radio, magazine, etc), and do the creative and idea generation for “free”. Now most agencies mark-up advertising very little, or not at all, and simply invoice for their time spent on an account. This includes copywriting, art direction, project planning, photography and everything in between.
The general rule of thumb for how much a company should invest in marketing is 10% of revenues. For B2C product based companies, they budget closer to 16% of revenues on average.
According to a 2014 CMO survey published by the American Marketing Association, they grouped businesses into four categories and calculated the average marketing budget for each.
B2B Product Businesses: 10.6% of revenue
B2B Service Businesses: 10.1% of revenue
B2C Product Businesses: 16.3% of revenue
B2C Service Businesses: 10.9% of revenue
Reporting and Metrics.
Building trust in a retainer relationship
A marketing retainer can be a scary thing to commit to. How do you know that the agency is delivering value for all that money you are giving them?
In a word: Reporting.
Reporting is (wrongly so) often tagged onto a project as an afterthought. But it needs to be a key deliverable to show accountability, transparency, and to build trust between a client and an agency.
Reporting can include metrics on different campaign initiatives, examples of creative or content that was generated, or recaps of budgets and advertising spends. More importantly, it presents an opportunity to discuss what isn’t working, what is working, and what is coming around the corner.
Tired of flings?
It’s time for a real relationship.
A strong agency retainer relationship is like a real-life relationship. The respective parties push each other to be better versions of themselves because they are in it for the long haul. Together.
If you are looking for a long-term partner and that can help you accomplish your goals, and help you write your story - then it might be time to look at taking your relationship with a marketing agency to the next level.
We wrote this guide to help shed some light on the tricky nature of Agency Retainers and Agencies of Record. It is a topic this is usually glossed over for businesses, and we wanted to really get into the nuts and bolts of how they work, and when they work. We are always looking to add more content/value to this guide. So if you feel like anything was missed, or have any questions that we can help answer, shoot a note over to myself, or any other member of Csek Creative, and we will make sure help you out, and see if we can help others out by updating this guide.
We get excited about the long-term, strategic, and results-based approach that we can take with our clients when they trust us to be their marketing partners. If you are looking for a marketing partner feel free to reach out at anytime.