Tag Archives: brands

The Time is Right for Procurement & Marketing

6 Nov

time is right for marketing procurementToo often brands change advertising agencies like politicians change their stance on key issues. Debating the efficacy of this dynamic is a topic for another time. The issue which I would like to address is how Procurement can assist their Marketing peers in mitigating the risks associated with the revolving door approach being employed by many organizations when it comes to their marketing services vendor network.

Building brands is expensive to be sure and there is no guarantee that if a company invests the marketing funds necessary to launch and sustain a portfolio of brands that its efforts will yield the desired results. However, successfully building brands can create tremendous asset value for an organization which in turn can deliver superior returns to its shareholders year-in and year-out. Given the size of the budgets involved and the relatively thin margin between success and failure, it behooves an organization to optimize each and every marketing dollar invested.

To this end, the Marketing Team is perfectly capable of assessing the competitive landscape, positioning the organization’s brands for competitive success and determining the appropriate strategies for driving sales and market share. Proficiency in these areas will drive sound resource allocations decisions with regard to target penetration, market support, media selection and messaging. Marketing should “own” these areas and should be held accountable for the impact of their decisions and the resulting return on marketing investment.

So, where does the role of Strategic Sourcing come into play? In assisting Marketing with the procurement, stewardship and evaluation of its agencies, thus leveraging their processes, tools and expertise to aid marketing in the following areas;

  • Managing the vendor selection process
  • Development of agency remuneration programs
  • Best practice contract development/ negotiations
  • Improved reporting and transparency
  • Ongoing monitoring of agency performance
  • Independent auditing of agency contract complianceand performance
  • Securing and providing performance and relationship feedback to all stakeholders

With Marketing focused on the demand generation side of the ledger and Strategic Sourcing on procurement best practices, the organization stands to benefit both in terms of in-market performance and in maintaining the appropriate controls, transparency and benchmarking data that can drive marketing vendor sourcing and performance management.

The old days of decades old agency relationships are not as prevalent as they once were. Therefore, advertisers must confront the impact of the growth in the number of marketing services vendors and the frequency with which this roster of agencies changes. With change comes opportunity to be sure. But change also increases the risk quotient. With Procurement and Marketing working together the opportunity to effectively manage the risks associated with these changes; improve vendor network performance and the organization’s return-on-marketing investment increases exponentially. Interested in learning more? Check out the article by Paul Broeren, Managing Partner of Quadrivium BV on how to enhance to effectively involve procurement in the marketing services procurement process at Procurement Leaders.

 

How Will Madison Avenue Fair in the Future?

19 Nov

how will madison ave fare?For an industry that has long prided itself on its ability to adapt to change the future will prove interesting for the advertising industry.  Technology driven trends ranging from dynamically generated behavioral driven ad generation to media fragmentation and dramatic changes in consumer media consumption have ushered in a number of changes that must be dealt with during this time of marketing convergence.

Perhaps the most fundamental change is that the industry’s “old” communications model of intrusive media talking at consumers is waning in relevancy in a world where user generated, user shared content forms the basis of a dialogue among consumers’ and between consumers and brands.

How will agency holding companies and individual agencies structure themselves to deliver services? What services will they offer?  Will there be room for specialist marketing services providers or will we see the re-emergence of the full-service agency (or agency holding company)?  How will compensation practices evolve to reflect the structural changes that are occurring within this market?

While change creates challenges, it also generates opportunities for advertisers and agencies alike. Those that grasp the strategic relevance of the rapidly evolving landscape will emerge as thought leaders and will have an opportunity to establish distinguished positions for their firms. As George Bernard Shaw the Irish playwright and co-founder of the London School of Economics once said:

“Reasonable men adapt themselves to their environment; unreasonable men try to adapt their environment to themselves. Thus all progress is the result of the efforts of unreasonable men.”

Where will your firm fall on the progress continuum? The following Fast Company series on “The Future of Advertising” provides a thought provoking look at what’s next for the advertising industry Read More.

 

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