According to this article from AdAge, Coca-Cola is wanting to "to start an industrywide movement toward a 'value-based' compensation model like one it has adopted that promises agencies nothing more than recouped costs if they don't perform."
I'm not sure why Coke has designated itself as qualified to setting the industry standard. But it is an interesting prospect. Is it fair? IMHO, yes and no.
Let's face it -- advertising is always a bit of an experiment. The strategy, creative, media, sales force involvement, market conditions, and even external factors such as current events affect a campaign. Sure, (hopefully) your campaigns will be designed up-front with solid market research and key insights to drive you in the right direction. But to truly do it right, advertising is an ongoing cycle, especially when it comes to online marketing. Test a campaign, measure it, then optimize it, measure some more .... To ask agencies to only get paid for what works at X% margin is a bit much, even if you are Coke.
On the other hand, the model forces a focus on results. And if you're an agency that gets results, that's a very good place to be. Too often, marketers ignore analytics either out of ignorance, arrogance, or fear. From where I am sitting, I have seen too many pharma marketers get much more excited about pretty pictures and what color things are, versus being focused on analytics and results. There are some marketers that focus on the numbers and leave the creative to the experts (and man do we love working for them!), but they're a little more scarce.
The current excitement around social media is a current example of"focusing on the wrong thing" a bit. (Social media evangelists, hear me out ...) Everyone is talking about social media, but its for the most part still a new and unproven model, and the results just aren't there yet. The push now is to get pharmas to get more involved so benchmarks can be set and case studies established. And that I wholeheartedly support. But I wouldn't be able to predict how your sales will be affected by it. Not yet.
Sometimes you need to get back to the basics. I'd like to see Pharma Marketers focus more on analytics. Which campaigns are performing? Which medium is best reaching your audience? What are the most cost-effective channels? Which leads are converting to your product, and where did those leads come from?
If your agencies aren't providing this information to you now, you're missing the most important component of even the prettiest campaign.