The Association of Advertising Agencies of Nigeria (AAAN) has set up a taskforce to address the lingering issue of non-payment of pitch fees by clients to creative agencies.
Addressing a press briefing for the sectoral group’s 48th AGM/Congress, the AAAN President and CEO/Chief Creative Officer X3M Ideas, Steve Babaeko revealed that the association has constituted a taskforce that will report any pitch where the client fails to pay the pitch fees.
Baba Eko said: “During this tenure, we have had cause to write one or two letters to clients who are bent on organizing a pitch without pitch fees. We have filed letters to them, and sent a cease and desist action to let them know this is what our law says and we will also continue to do that. We know sometimes that our members, out of the eagerness to land that business might not report by themselves, this is why we constituted the taskforce that will keep their ears to the ground and report back to us if they hear anything of such so we can do the needful. The thing is that if nobody reports, then there is no case.”
The pitch fee was introduced as a way of compensating the agencies for all the efforts, non-recoverable external costs, human resources, expenses incurred, and the intellectual input channeled towards the success of the pitch.
Although it is a standard practice in some countries, it appears to be failing in the Nigerian market. Players emanating from the Nigerian marketing and advertising eco system however urged the AAAN to encourage agencies not to accept briefs or participate in any pitch process that do not have pitch fees attached.
When pitching for a prospective account, agencies would use portfolio, slides, video, storyboard and other channels to review their organizational set-up, result for other clients, types of accounts, experience of personnel, specializations, and any other information pertinent to winning the account. As such, the pitching fee was to serve as compensation to the agencies.
In 2016, the AAAN tried to enforce the payment of pitch fees, according to the former AAAN President, Mr. Kayode Oluwasona, there were cases where the body sanctioned clients for defaulting on the payments. In 2019, the Association also declared its full support that agencies be well compensated through payment of pitch fees to augment their strategic and creative inputs.