At the end of last year I was asked to identify some trends that were most likely to stir up wild eddies in the 2006 consumer-marketing continuum. When you deal with customer loyalty metrics as we do, shifts in customer values always identify important changes that are coming down the road, usually 12-18 months before they show up on traditional research radar screens. So you can be pretty confident in your prognoses.

As these are predictive metrics, how marketers navigate these newly churned waters is always sure to determine the difference between success and failure. I mentioned five key trends, but one in particular resonated more than the others and was sure to have the most far-reaching effects: “consumer engagement.”

If you’re not tuned in to it now, you will be very soon. Defined as the outcome of advertising and marketing activities that substantively increases a brand’s strength in the eyes of the consumers (and if measured properly can actually predict sales and profitability), engagement is being used more and more to allocate marketing budgets. It has inserted itself between traditional marketing activities and an increasing demand for some kind (some might say any kind) of ROI assessments, At the very least people are talking about using engagement to make branding and creative decisions.

An initial examination and review by a task force spearheaded by the Advertising Research Foundation came to a critical conclusion: Traditional marketing and research had built advertising (and other) test systems on “accepted” models of how advertising worked. Well, it turned out that those models were asking and expecting consumers to think too much. In actuality people feel more than think.

Well, we agree wholeheartedly with that! Our company has maintained that since the dawn of the 21st century “bionic” consumer (which, on a standard calendar, was actually around 1985), the brand engagement process is 70% emotional and only 30% rational.

Yes, the Total Quality Management movement and process reengineering and a desperate need to “satisfy” customers from decades past, combined with the current technological advances in computers and cell phones and 24/7 access via the Internet to everything, have a lot to answer for! Most products and services are pretty much the same when it comes to meeting functional needs, and consumers don’t have to “rationally” think and compare and agonize about those product differences, because a) there weren’t all that many differences between category offerings (can you spell “commodity”?), and b) consumers were getting the information that they were using in the 30% of the rational decision process from places other than traditional marketing and advertising (who among you doesn’t have Google bookmarked on your computer?). So what does that leave but the emotional effects engendered–or owned–by a brand? Or the “emotional” advertising for a brand? Or the media for a brand that optimize a brand’s engagement opportunities?

Our studies have proven that if you can successfully identify, address, and communicate those emotional elements and values, you are virtually guaranteed to “engage” consumers. Certainly better than the competition relying on a presentation of rational facts, no matter how creatively shrouded they are. And don’t even think about expanding your media options as a “solution.” Today brand managers and marketers are more concerned with engaging customers than with finding them. Finding them stopped being a problem a long time ago.

The difficulty is, of course, that acknowledging the need to engage customers and actually measuring real customer engagement are two entirely different things. Most of the time there is no clear understanding of the emotional elements beyond the traditional, tried-and-true images and themes. (Memo to those marketing to baby boomers: 1960s rock music can only go so far.)

Real “engagement” is the consequence of any marketing or communication program that yields an increased level of brand equity for your product. When we say “brand equity” we mean the degree to which a brand is perceived as meeting or exceeding consumer expectations for the category in which it competes. Most of the time most of those “expectations” are emotionally based. And unconstrained by reality. Consumers want what they want, and they want it now!

Doubt me? In the past eight years, consumer category expectations have risen on average 27%, while brands have kept up only by 8%. That leaves an awfully big gap for you—or your competitor–to engage the consumer. If you measure it properly. And if you deliver it in a way that emotionally resonates with your audience and the brand.

Jim Stengel, the oft-quoted Procter & Gamble global marketing officer, said, “Without the right measurement, we really don’t know how well our efforts work. We don’t know if we are in touch with our consumers. We cannot continue to apply traditional thinking to the new world of technology and marketing channels available to us today.”

Engaging man, that Jim! Robert Passikoff, Ph.D., president of New York-based marketing firm Brand Keys (www.brandkeys.com).

Client-side promotion people often voice similar complaints about promotion agencies. Brand managers will say that agencies don’t do homework on the products they are trying to sell.

That they pitch their services with seasoned individuals, then service the account with junior-level people.

That they don’t think strategically.

That they lack good business sense, and come up with plans that they like rather than ones that are good for the brand.

That they don’t understand the trade side of the equation.

These perceptions are real, and agencies should take them very seriously. Yet if brand managers would follow certain steps in selecting and managing agencies, they could reduce or eliminate a majority of these problems. As an added bonus, the quality of agencies’ work will improve.

Many common pitfalls in the client-agency relationship disappear when clients foster real teamwork with the agency. It is the responsibility of the client to create this spirit by establishing clear direction for the agency to follow, sharing with it all pertinent information, measuring its progress in the development of the promotion, and having frequent and meaningful communication about the work.

SELECTING AN AGENCY

Have a clear idea of what type of promotion you are planning, then match an agency’s assets to your needs. Don’t become enamored of art work or copy the agency may provide in a capabilities presentation and neglect to find out how they are staffed and what level of experience they have in your industry and in the type of promotion you want them to develop.

Make sure you and your staff meet with the account team. You don’t want to be working for months with personalities you find irritating or unprofessional. Find out who specifically is going to work on your project and their level of experience. This may require some digging.

A few years ago when I was on the client side, we called in three agencies to give credentials presentations. We found that two agencies were both claiming credit for the same kids’ meal fast-food promotion. When we followed up with phone calls to the agencies, we found that the key creativeperson behind the promotion at agency A had left to join agency B, which otherwi se lacked experience and had misrepresented itself in the presentation. We chose agency C, which had experience in kids’ promotions and had retained the people with that background.

MANAGING AN AGENCY

Clearly define the agency’s role and responsibilities. Everyone needs to know what duties the agency will have and which ones the client will take on. I learned this early in my career, when I assigned an agency I had not worked with the task of developing a series of four FSIs and did not make clear that I would book the dates and reserve the category with the FSI company.

We ended up with eight reservation dates when the agency went ahead – as was their custom – and made the bookings itself, spurring a few frantic phone calls from the FSI salesperson before the matter was cleared up.

The larger the agency’s role, the greater the need to immerse it in your brand and be open with information that is often not publicly available. It is the client’s responsibility to help the agency understand its business by providing information on the brand’s target audience, its product category, and its channels of distribution, for example. The agency should not be viewed as just another vendor.

Establish benchmarks by which you can track the work and its results, and schedule regular meetings with the agency to review its progress in meeting key dates. The agency should not be left to decide what it is going to report on and when those reports are due. The client needs to spell out clearly what information the agency needs to communicate and to whom.

For example, it is critical in account-specific promotions that agencies have direct contact with salespeople as well as with the marketing and promotion departments. Three years ago, when I was involved in a free-ticket promotion with 16 different Major League Baseball teams, we gave the agency the name of our sales-planning manager as the key contact for coordinating the different retailer ads that were required. This created a tremendous work load for the planner, but we executed a complex program with no mistakes.

Clearly establish a budget, which includes saying exactly how and when the agency will be paid. The budget and expenditures must be reviewed frequently, with significant variations handled immediately. Make payments to the agency on time.

An agency friend of mine recently had an experience which was far from atypical. A month into a project, the client added additional work onto an assignment for which the agency had already provided an outline, concept boards, and a budget estimate. Asked to quickly develop rather extensive materials for an upcoming national sales meeting, the agency faxed a budget estimate, but in the chaos of preparing for the meeting it was seen only by an assistant brand manager. Though all were happy with the work, which was airfreighted to the meeting just in time, the senior brand manager hit the roof when he saw the bill.

The bill was paid, but not without much acrimony on both sides, and neither side wants to work with the other again. This problem would have been alleviated if someone had insisted that the client sign off on the budget during the first few hectic days of the project.

LEARNING FROM EXPERIENCE

Produce a formal written review of the agency’s work that covers topics such as competence of staff, quality of planning and strategic input, level of creativity, success in meeting deadlines, interpersonal effectiveness, and quality of work. Provide a copy to the agency and keep another in a reference area accessible to other managers.

The client-agency relationship is the pairing of two unequal partners, with the client holding the upper hand. It is the client who sets the agenda, hires the agency, evaluates the outcome, and pays the bills. When the client puts extra effort into managing the relationship, the agency can respond proactively to the issues the client faces, and will perform more effectively and efficiently. It’s in the client’s best interest when the agency feels it is not a hired hand but a part of the team.