If you work in an ad agency, the story I am about to tell will not shock or surprise you. A client calls and asks you for an estimate on how long a new website or brochure will take to build out. In a scary moment you spit out a range of numbers -- your brain is saying “NO, don’t do it!” but alas, the words come, and the client seems happy with how you have answered. You hang up the phone and start to cross your fingers.
But wait...a few weeks later you have an email and the client is ready to start the project and mentions the cost and timeline you let slip out, and here you are.
While this is an extreme example, it is not that uncommon in our business. Many agencies don’t spend enough time and effort in estimating the time and cost of a project. This often leads to a loss of profitability of the project, completing out of scope work, client relationship woes, and missed deadlines.
This is partly because we want to be able to give clients a simple answer to these common questions: How much is this going to cost? And how long will it take? But project estimating is both an art and a science: You can only know the time required to complete a project once the project is 100% done. Below are a few tips I have from experience in estimating over the years.
1) Understand the forest by studying the trees.
In my experience, most projects have a timeline and tasks that are dependent on each other in order to keep the workflow going. If you hit a speedbump (which, let’s be honest, you are lucky if there is only one on a project) the whole project is now affected. We live in a world of the domino effect, especially when working on projects where multiple departments are dependant on each other. This is a big reason we have moved away from the more “waterfall” like project management style to taking a more agile approach.
The most important thing when working on an estimate is understanding what the best case scenario is and then anticipating what parts of the project are most at risk – these are the parts that the deadlines are imperative in determining your estimate. Taking time with this step will help you to adjust timelines appropriately and provide yourself and the client with a definitive project time frame and allow you to include a buffer.
2) Know your team and what they do.
One thing I learned early on that is imperative to providing accurate estimates or proposals, is understanding the jobs around you. No, I am not coding websites, designing digital ads, or calculating the frequency and reach for your media buy, but you better believe that I have spent time with all the various people in our office who do those things for you on a daily basis. I get to understand their process, what they need to get started, common issues that can cause a stumble, and how they will present the final product. When armed with this knowledge you can relay to clients more confidently an accurate estimate and also know the best questions to ask your team members when starting a new project.
3) History repeats itself.
Another valuable lesson I learned early on when managing projects is the important role that history plays in accurate estimating. The first thing I do when trying to create an estimate is go back and look at similar projects that have been done for either the client I am estimating for or a similar project that can help me be more informed from the start. Going back and looking at the time that was used on a past project, seeing how similar the scopes are, if the same people will be working on it, how many rounds of revisions the client had on the project will help you craft a more realistic estimate.
4) Scope, scope, and scope again.
Asking the client the right questions from the onset of the project is crucial in providing accurate estimating and helping get the project started on the right path. When a client sends me a request for a new project, I like to start by hopping on a call to get the most information and “real” answers needed to ensure that I am equipped and understand the scope and what resources it will require from our agency.
Below are some questions I have found helpful -- maybe you will too:
- What is the goal or objective of the project?
- Why are we doing this project?
- Are there other projects that depend on the completion of this project?
- What constraints on the project exist?
- Who will manage the project from the client-side?
- Who needs to review and approve the work?
- Who will be the final decision-maker?
- How many days do you need to review and approve drafts?
- What is the ideal delivery date?
- What are potential barriers from your side from getting the project approved and completed?
Now for an added bonus -- while writing your estimate, it is crucial to include in the scope what all your estimate entails the agency providing to the client, but it can be just as crucial to point out what is NOT included. Usually these are the things that have been a hangup in previous projects that you recall from that history review phase. Things like the following: “This website estimate does not include the purchase of an SSL certificate.” or, “This digital design estimate does not include the purchase of stock images those will be costed separately based on need.” This will help keep costs under control and keep the client aware from the start.
Will your agency need to buy certificates, licenses, subscriptions, or other materials to complete the project? When scoping the project, determine if you could complete the project more efficiently and effectively if you had different tools. You might also require access to research reports, data, or consumer insights reports. Discuss these costs with your team before estimating so that the scope of work you provide the client encompasses everything that the client will be responsible for.
5) It all depends on…
In the end while these tips are helpful in accurate estimating, you must be realistic and remember that they are just that -- ESTIMATES. While you can make an educated guess and prepare as best you can to ensure you start the project off smoothly, there are always things that can come up and change your well-crafted plan. As a safety net for any estimate, it helps to include a contingency cost that can allow for some of those uncertainties to occur. This costs can be standard for all projects or custom to the project scaled by size.
I hope these 5 tips help you to better estimate for your clients as you work on new projects in the future. At the end of the day, the best thing you can do is prepare, research, and let’s be honest, cross your fingers when providing cost and timeline estimates to clients. Have any tips you would like to share with me on how you best craft estimates? We would love to hear them down in the comments.