Marketing Services Agreement

Essential Elements of a Marketing Agreement

If you’re a business owner, you likely have a seemingly infinite number of tasks on any given day—and activities related to marketing your business can dominate that list.

While there are plenty of resources to help you understand how to create a marketing plan and do your own marketing for your business, sometimes it is a good idea to leave it up to the subject matter experts. This means hiring a marketing agency or consultant to take care of the marketing of your small business for you.

While this can free up your time significantly—not to mention leave it to the pros to do what they do best and market your business—working with an outsider on something so important means that you need to think through logistics.

In this case, you need to draw up a marketing agreement.

What Makes a Great Marketing Agreement?

A marketing agreement is a document, signed by all parties involved, that lists the scope of work to be undertaken, and any duties and expectations that the business has of the marketing agency.  

A marketing agreement is:

• A written document
• Drawn up by one party
• Agreed upon by all involved
• Inclusive and descriptive of all marketing work done by the outside agency or consultant
• Clear in scope

Like any business contract, a marketing agreement discusses what is expected of the hired marketing agency or consultant, and goes into detail in terms of the scope of work they’ve been hired for. It is a legal document that serves to illustrate what a marketing agency or marketing consultant is being hired to accomplish. It acts as a record of what has been agreed upon by all parties, and it goes into detail on logistics such as payment, timeline, and deliverables.  

It serves also as a written record that protects all parties, as it clarifies what is expected of who and by when. This way, for example, the business cannot falsely claim that the marketing agency did not hold up their end of the deal, since the marketing agreement clearly defines the scope of the project.

What Should Be Included in a Marketing Contract?

Unlike other types of business contracts, a marketing agreement is not a contract with a clearly defined structure that needs to be followed. There are elements that will exist in the majority of agreements, but there is not one set structure that all businesses use.

So, all marketing agreements will have a discussion of payment terms, timeline, and some articulation of the work being done by the marketing agency. There may also be a section covering legal matters such as copyright protection, nondisclosure, or other provisions related to a business’s proprietary information.

A marketing contract will likely also include details on what parties will do if the agreement needs to be dissolved prematurely, and a clear outline of what success looks like, so that the business can determine whether or not the marketer has successfully accomplished what they were hired to accomplish.

If you want a template to work off of, it can make creating a marketing agreement much easier. 

Tip: Along with this article, you’ll be able to download a free marketing agreement template, which will give you a guideline that will help you create your own marketing agreement. 

Even if you work off of a template, however, you will need to tailor your marketing contract for your unique situation, your industry and business, and the scope of work that you are hiring your external marketer for, so be sure to read through the elements of a marketing agreement to make sure you have covered all your bases.

The Elements of a Great Agreement

So, what does a marketing contract actually include? To be used by your business, an agreement needs to include the following:

1. Discussion of exclusivity

Typically, a contract will give exclusive rights to the marketing agency or consultant to do marketing, public relations, and so on for the business or product for the duration of the contract.

That is to say, if a marketing agency was hired by a small business to promote a new product, the marketing agreement would stipulate that no other marketing agencies will be involved in marketing said product for the duration of time specified.

This means clearly identifying the client (the business) and the consultant (the agency or marketer), and will outline the duration or scope of the project, clarifying that no other agency will be used during that time frame.

2. Timeline details

As mentioned above, a timeline is a needed part of a marketing agreement. For one thing, the agency or consultant will not have exclusive rights to do the business’s marketing forever; they are likely hired on for a specific length of time (to promote a newly launched product, service, or business, for example), or to promote a specific product or service.

So, a marketing agreement needs a clarified timeline, to be agreed upon by the client and the consultant. This is typically one to two years, however, the timeline is dependant on the needs of the business.

3. Payment and cost details

The nuts and bolts come into play here—what is the overall cost of hiring the agency or consultant, and how and when will they be paid?

This section of the marketing agreement should clarify the overall exact payment amount, as well as any details on payment structure. So, this could look like a discussion of monthly payments, clarification of complete payment up front, and so on. Getting prior written consent on payment terms is a must.

4. Project-specific details

This is the most flexible part of the marketing agreement; after all, every agreement will look different.

Take some time at the outset to make note of the details of the project you hope to hire an outside marketing firm to accomplish, as you’ll work those details into the agreement. What type of work are you hiring them for? Are they writing a complete advertising and marketing plan for your entire business as a whole, or simply marketing a single new product? What avenues are you interested in pursuing—are you hoping for a well-structured social media campaign, PR outreach to local media, paid advertising, and so on?

Include the necessary details here. Remember, a marketing agreement serves as a record of your expectations, so getting on the same page in terms of what you hope to receive from your chosen agency gives you the best chance possible to have a satisfying working relationship.

5. Timeline for completion

As I touched on earlier, you will need to clearly lay out when the different components of the project are due, how long you plan to work with the agency or consultant, and any other date-specific information.

So, if the project involves certain deliverables that will be completed by a certain date, list that here, and also clarify the overall timeline that the relationship covers (a one year contract, two years, and so on).

6. Guarantees

Will you need to see certain metrics improving in order to measure success? Do you expect to see a certain increase in sales volume, or search traffic, or some similar area where the marketing consultant needs to move the needle? Include a discussion of that here, including any periodic check-ins, and perhaps make mention of where your numbers currently stand so as to establish a baseline.

7. Any legal disclaimers, insurance information, confidentiality, or similar

Depending on your industry, there may be certain legalities that need to be discussed in terms of your marketing agreement. There may even be a discussion of taxes, and who will pay what. In addition, be sure to cover any information about insurance, if applicable.

If your business relies on sensitive intellectual property or proprietary information, you may need to include information about how this will be handled. This includes, potentially, a discussion of ownership of property—that is to say, you may need to go into detail about who owns existing elements of your business, and also who will own anything created by the marketing agency or consultant during their tenure with your company.

Also, if you are requiring that your contracted marketer sign a non-disclosure agreement, you will need a section on confidentiality. This usually looks like a statement of the fact that a signed non-disclosure agreement exists, not the actual agreement itself—that is something you will have to work out at a different time and via a different agreement.

Do You Really Need a Marketing Agreement?

So, we’ve gone over the basic nuts and bolts of a marketing agreement.

But, is it really necessary to have one? Why isn’t it enough to simply hire a contractor or agency for a specific period of time and let them do their magic? Isn’t the whole point of hiring an outside marketing agency that you can free up time and not worry about marketing your business?

Well, yes. Technically, you can go without ever having to draw up a marketing contract, if your contracted agency or consultant is on board. However, there are several important advantages to having a marketing agreement in place. While there are downsides, the pros seem to outweigh the cons.

The Pros of Having an Agreement

• Accountability: There is a clear illustration of the responsibilities of all parties involved.
• Clarification of scope: Everyone will understand what the scope of the project actually looks like, ensuring a satisfactory working relationship.
• Reduced risk of miscommunication: You are less likely to butt heads over something like when payments are due, or the expected outcome of the project, if everything has been clarified up front.
• A written consent: If, worst case scenario, the relationship goes sour, you are protected by the fact that you have a record of everything that was agreed upon by all parties involved. If a disagreement occurs, you can always reference the applicable law.

The Cons of Having an Agreement

• More time-consuming than not having an agreement at all: Clearly, it is more time and labor intensive to create a marketing agreement than it is to skip the process entirely.
• Things can still slip through the cracks: While you may attempt to cover all your bases, it’s true that it is not always feasible to protect yourself from all possible negative outcomes.
• Some agencies or consultants may be reluctant to sign something so official: There may be those out there that reject the idea of signing what feels like a formal contract.

While these cons do exist, the reality is that they are slight when compared to the benefits. Beyond a small amount of time up front, having a marketing agreement does not pose a significant investment of time. And, while it is true that you cannot always protect yourself from every eventuality, having an agreement in place is still great insurance against a falling out or bad relationship—and will make it much more likely that everyone is on the same page, and that the relationship goes smoothly.

Finally, while there may be some agencies or consultants who do not wish to sign a marketing agreement, this should not deter you; rather, it should serve as a bit of a red flag! The reality is that having a marketing agreement in place protects both the small business and the hired marketer, so it is in everyone’s best interests to have one in place from the start.

Best Practices for Agreements

While not required, here are some key areas to think about when constructing your marketing agreement that will make determining success easier.

Include a section defining key terminology. This includes how parties will be referred to throughout the document (i.e., “Client,” “Consultant,” and so on).

This often looks something like this:

This Marketing Services Agreement (“Agreement”) is being made between [Customer Name] (that’s “You” or “Your”) located at [Street Address, City, State] and [Company Name] (that’s “We” or “Us”) located at [Street Address, City, State] on [Month DD, 20YY]. [Customer Name] and [Company Name] may also be referred to as “Party” or together as the “Parties”.  This Agreement will become effective on [Month DD, 20YY] (“Effective Date”).

Be clear on the numbers. What actual, concrete metrics are you looking to improve, and what does improvement look like in numerical terms? Having an actual hard number helps hold your contracted marketer accountable, and makes it easier to see if their efforts are actually benefiting your business in the way you had hoped.

Clarify what type of communication is required. So, you say regular updates are needed, and you have laid out a timeline. Do these updates come in the form of an in-person meeting? A Skype call? An email update? Specify what you are expecting.

Define what success looks like. Building off the idea that having actual concrete numbers can only help you, make sure you have a crystal clear articulation of what a successful relationship between your business and the marketing agency or consultant. Fluffy language like “improve social media presence” is not the best way to define success; make it as clear and measurable as possible.

Include information on termination. What happens if you feel that the agency you’ve hired isn’t quite measuring up? It’s a good idea to cover what will happen should you decide you no longer want to see the relationship through to the end of the specified timeline.

Keep the legal nature of the agreement in mind. Make no mistake—a marketing agreement serves as a legal document. So, it is a good idea to have a lawyer look over your agreement before you pass it off to the agency or consultant you plan to hire.

Marketing Agreement