Business Advisory

The dark side of private tenders in the agency world

Il lato oscuro delle gare d’appalto private: analisi e implicazioni per le agenzie. Focus sulle dinamiche occulte.

Free pitching is not a competition. It is extraction.

Because asking for work without paying for it does not select the best. And in the end, it is always the brand that pays the bill.

There is a practice that has quietly become normal.

And the silence is the problem.

This is how it works: a company decides to look for a partner. It writes to five, six, ten agencies. It puts them in competition. It asks for a website already built, a strategy already defined, a brand identity already developed, governance for international markets already in place. Weeks of work, hours of research, minds at full stretch. And then, at the end of the process, it decides. The winner gets the contract. The losers get nothing. Not even their out-of-pocket expenses.

This is called unpaid pitching. And in recent years it has become so common that it seems normal. It is not.

When the brief becomes extraction

There is a fundamental difference that many companies pretend not to see.

If you want to understand how an agency works, how it thinks and how it operates, you can. You can ask for a meeting, look at past work, speak to clients who have already worked with them. You can ask for an approach, a vision, a direction. That is a legitimate selection process.

It does not require the agency to work for free: it requires it to show up.

But if your brief says: I want to see the finished website, the strategy ready, the visual identity developed, then you are asking for work.

And work, in every other sector in the world, gets paid for.

No business owner asks a lawyer to write the full defence brief before signing the contract. No one asks an architect to hand over the detailed design just to decide whether to hire them. Yet in marketing this logic has become established practice, and those on the receiving end often accept it, because refusing means giving up the chance to win.

The result is a system that works exactly the opposite of how it should.

Adverse selection: why free pitching picks the worst

Herein lies the paradox that few companies stop to consider.

The company that launches an unpaid pitch is convinced it is making a meritocratic choice. Putting everyone on an equal footing. Selecting the best.

In reality, exactly the opposite happens.

Agencies with solid positioning, established clients and a reputation built over time turn down unpaid pitches. They do so because they can afford to. Because they know their value is not demonstrated for free. And because – this is the crucial point – those who work for free unconsciously signal to the client that their work is not worth paying for. The No Free Pitches Manifesto, signed by hundreds of agencies internationally, is the public formalisation of this position.

Those who remain in the pitch, then, are those who lack this solidity. Those who need the contract. Those willing to do anything to get in. Not out of bad faith, but out of necessity.

Need, however, is not an indicator of quality.

On the contrary, it is a sign of fragility.

The neurobiology of perceived value confirms this dynamic unequivocally: research carried out at Stanford University has shown that the human brain assigns value to things in proportion to the effort or price paid to obtain them. The ventral striatum and the dopaminergic system (that is, the brain structures linked to reward) activate with different intensity depending on the investment made. What comes free is processed, literally, as less valuable.

This is not a moral judgement. It is neurological mechanics.

In other words: when you choose the agency that accepted your unpaid pitch, your brain has already decided, unconsciously, that it is worth little. You have just set the wrong starting point for the entire relationship that follows.

The ideas that vanish without a trace

There is a chapter of this story that is kept even quieter.

Many companies use the ideas of agencies they did not select.

Sometimes they do it knowingly, commissioning a cheap supplier to execute a concept that came from someone else. Other times, not – perhaps simply because an idea presented in a pitch lodged itself in the mind of whoever saw it, and six months later resurfaced as their own.

BrewDog came under the spotlight for this. Its former agency stated publicly that a campaign concept had been presented in the pitch, rejected, and then produced by others without credit or payment. It is not an isolated case. It is the tip of an iceberg the industry knows well but rarely names.

The 4A’s rule is explicit: a client has no ownership rights over ideas developed by an agency during an unpaid pitch. But enforcing this principle carries a legal cost that most agencies cannot afford. So intellectual theft goes unpunished, and the system carries on.

A company that uses other people’s ideas without paying for them is not saving money. It is building its strategy on orphaned foundations, without the context, research and deep understanding that lay beneath them.

And sooner or later, it shows. Always.

The table where the decision-makers were absent

There is another element that anyone who has been through this process knows well, and that is rarely put in writing.

The pitch is presented. The agencies do the work. Evaluation day arrives. And the CEO is not at the table. Nor is the CMO. Nor anyone who carries the real weight of the decision. Instead there are mid-level employees, often disengaged, often without a clear mandate, often lacking the vision needed to tell the difference between a deep strategy and a nice presentation.

This is not a people problem. It is a problem of incentive structure. Behavioural economics has documented precisely what happens when decision-makers have no skin in the game: without personal risk, the brain does not engage its deeper evaluation circuits and settles for superficial criteria: aesthetics, price, how likeable the presenters were.

The result is a double defeat: the best agency loses because it was not assessed by someone who would have understood its value. The company loses because it chooses on the basis of criteria that have nothing to do with what it really needs.

What the public sector has understood, and the private sector ignores

There is a paradox worth naming openly.

The public sector is often described as slow, bureaucratic and inefficient. Yet in the way it runs tenders between suppliers, it follows rules that the private sector has never imposed on itself.

Italy’s new Public Procurement Code (D.Lgs. 36/2023) explicitly introduces the principle of good faith, which requires both parties to act fairly. It establishes the obligation to communicate who won, how and why. It guarantees unsuccessful participants the right to appeal and to reasoned feedback. It provides for independent oversight (by ANAC) of the fairness of every procedure.

These obligations did not arise by chance. They are the result of decades of abuse, opacity and conflicts of interest that made formal regulation necessary. Transparency is not institutional courtesy. It is a tool of protection for those who take part, for the market, and for those who commission.

The private sector has no such obligations. It can invite ten agencies, request weeks of work, vanish into silence and answer to no one. It is not illegal. But it has a cost, one that is rarely accounted for. According to industry data, British agencies lose on average tens of thousands of pounds a year on unpaid pitches alone.

The brand always pays the final bill

The story always ends the same way.

The company saves on the pitch. It chooses the cheapest agency – or the most available one, which is not the same thing. It gets mediocre work. It replaces the agency after six months. It starts again. And in the meantime, it has burnt through time and budget and slowly eroded the consistency of its own brand.

The industry knows this well: the PR industry has openly discussed how systematic free pitching is not just an ethical problem, but a mechanism that degrades the average quality of the market over the long term, discouraging precisely the best professionals from competing.

A brand is not just a logo. It is every interaction that generates a perception. It is the way a company relates to its suppliers, to those who work to build it, to those who take part in a pitch without being selected.

All of this is already brand. It is already message. It is already reputation: built or destroyed, one interaction at a time.

And the reputation built within the agency market – a small one, where information travels fast – is the same reputation that determines which partners will be available next time.

The best agencies do not turn up to certain clients’ pitches. Not because they do not need the work. Because they already know how it will end.

The question that changes everything

It is not a question of choosing between paying or not paying for a pitch.

It is about deciding what kind of relationship you want to build with those who will work on your brand. And understanding that this relationship begins long before the contract is signed: it begins the moment the first brief is written and you decide how to treat those who respond.

Those who govern a company’s decisions have a responsibility to bring this awareness to the table. Not as an abstract ethical question. As a concrete strategic choice: the best of the market is not found by asking everyone to work for free. It is found by creating the conditions in which the best have a reason to come forward.

And these conditions come at a price. Like everything of real value.​​​​​​​​​​​​​​​​

Frequently Asked Questions

Why does running a pitch to choose a marketing agency often lead to mistakes?

Because it selects those who know how to win pitches, not those who know how to deliver results. Pitches optimise for the presentation, not for real strategy. The brief never captures the complexities of the business, and the relationship that takes shape is that of a supplier.

How do you choose a brand advisory partner without a pitch?

Through real case studies, preliminary strategic conversations and small pilot projects. This approach reveals how a team thinks, not how it presents. The cost is lower, the signal is more reliable, and any incompatibility comes to light before signing.

What is the real cost of a competitive tender for an agency?

Weeks of unrecoverable work, briefs only partially interpreted, relationships built on competition rather than collaboration. For agencies, taking part in a pitch is a high-risk investment. For companies, it is often the slowest way to find the wrong partner.

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