Flock's Sebastián Tonda discusses Mexico's new agency fee model in Ad Age
With agencies doing more for less, some in Mexico have taken matters into their own hands: They're calculating fees based on a remuneration model that focuses on the amount of content produced for each client.
"We need to [talk] about value and creating more valuable work for clients, but need to create the conditions for that to happen," says Sebastián Tonda, president of the board for the Mexican Association of Advertising Agencies and CEO of Dentsu agency Flock.
Currently, 20 association agencies use the system. The model is based on a concept from chairman and CEO of New York-based consulting firm Farmer & Co., Michael Farmer, and uses a proprietary "scopes of work" (SOW) database. The database, says the Farmer & Co. website, "includes over 6,000 unique briefs across all media types. [Each brief] has a unique ScopeMetric Unit (SMU) value. The sum of the SMU values from each deliverable ... equals the total 'workload value' or size of the SOW in ScopeMetric Units."
Read the full story in Ad Age.