5 Benefits of Hiring an Ad Agency on Retainer

Terri Angelico  |  October 3, 2023

If you’re seeking outside help with your business’s marketing and advertising, you have several options. You could work with a freelancer, hire a marketing generalist, or hire an agency. Within the agency realm, there are several types of engagements to choose from. Some of these include hiring an agency on a project, commission, or retainer basis.

My over 25 years in the agency world have shown me the positive impact a retainer model can have on companies from a wide variety of industries.

In this blog post, we’ll explore...

  • What ad agency retainers are
  • What the alternatives to a retainer are
  • 5 key benefits of the retainer model
  • A real-world example of a Creative Noggin client who switched to a retainer model
  • Companies that may not be a good candidate for a retainer model

How do agency retainers work?

Before diving into the benefits, let's clarify how retainers function. A retainer is a contractual agreement between a client and an ad agency.

The retainer agreement identifies the services included and the fixed monthly fee for those services. If a project falls outside the defined scope, the agency provides an estimate for the additional work.

How much does an ad agency retainer cost? Retainer fees vary widely according to the agency and the client’s needs. The best way to determine what your retainer would be is to contact the agency you’re interested in working with and discuss your needs.

5 Benefits of Hiring an Ad Agency on Retainer

1) Collaborative Partnership

When you work with a great ad agency on a retainer basis, you get more than just a one-time vendor. You get a collaborative partner. The agency serves as an extension of your internal team, always looking out for new opportunities to help you reach your goals.

Having a familiar team that you can turn to is key. When you know your agency’s work is high-quality and their team is communicative, so much uncertainty is eliminated.

2) Time-Saving

By operating on a retainer, both the client and agency save time on estimating and discussing project costs. This efficiency enables the agency to start working on projects much sooner, streamlining processes.

For example, with a project-based contract, a client with a steady flow of 2-3 new projects each month would have frequent conversations about project estimating and scoping. With a move to a retainer model, most of these discussions are no longer needed. Instead, the client simply hands over the tasks to the agency.

3) Consistent Costs

A retainer ensures that the client pays the same fee each month, even if the workload fluctuates. For example, if the agreed monthly retainer fee is $15,000, some months may only require $13,000 of work, while others may require $17,000 or $18,000 of work. The agency and the client work collaboratively over the course of the year to ensure that goals are being met within the retainer.

Predictable billing allows clients to manage their budgets more effectively. Marketing teams and finance teams alike appreciate this.

4) Deep Familiarity with Your Brand

A retainer model allows the ad agency to thoroughly understand the client’s brand and industry. In Creative Noggin’s case, this lends itself well to Real Branding™—consistent branding that authentically represents your brand in all marketing efforts.

A retainer agreement allows our team to spend time on things like:

  • Discovery time with the client and agency to truly get to know the brand, stakeholders, target audience, etc.
  • Monitoring competitors
  • Ongoing analysis and optimization according to the KPIs

All this time spent helps spur great new strategy ideas for our clients. And it comes at no extra cost to them.

5) Focus on Long-Term Goals

The shift from a project-based model to a retainer model leads to a greater focus on long-term objectives. It promotes “big picture” thinking and allows the agency and client to adjust strategies over time according to results.

Some agencies—including Creative Noggin—factor in this crucial time for problem solving, brainstorming, and strategizing in their retainer fees. This promotes a thriving long-term partnership.

Real Client Example: Making the Switch to a Retainer Agreement

Let’s look at a real-life example of a Creative Noggin client who switched from a project-based relationship to a retainer agreement.

Each month, we completed 3-5 different projects for this client. Although the client’s Marketing Director was thrilled with our work, she found it stressful to work through so many small one-off estimates each month.

After a little over a year, we convinced her to avoid this headache by making the switch to a retainer agreement.

This made a huge difference for both the client and us. Conversations between the Marketing Director and her Creative Noggin Brand Manager were no longer about costs and scoping for each individual project.

Instead, conversations were about her business and strategies to help her level up her marketing and advertising. She had time to tap into our expertise like never before—all without having to worry “How much will this cost?”

When might a project-based engagement be better?

While retainer agreements offer a wide array of benefits, project-based ad agency engagements may be preferred in some cases. In particular, working on a project basis makes sense when a year-round partnership is not required.

Here are some examples:

  • A business’s operations are extremely seasonal (e.g. it does no business in the winter)
  • The client needs help marketing a single annual event
  • Only a one-time engagement is needed, such as a new brand development or a rebrand

Should you hire an ad agency on retainer?

From improved time efficiency to longer-term planning, retainer agreements can be very beneficial.

As an award-winning, full-service agency, we’re thrilled to be the advertising partner of choice for a variety of respected brands, many of which we work with on a retainer basis.

If you’re still not sure which ad agency contract type is right for you, don’t worry. Reach out to us at Creative Noggin and we’ll be glad to design the best fit for your marketing needs.

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