December 2009

Embracing the Old Enemy. Why procurement could be your greatest ally in 2010

Guest post: Public-sector marketing ROI? Must try harder…

In this latest guest post, Rosie Doggett. co-founder of RD Squared, analyses the UK government Central Office of Information's ten-step process for assessing the return of investment of public-sector advertising and marketing spend.

Mark Lund, chief executive of the COI, no doubt thinks that he and his department have covered all the bases by unveiling the 'ten step process' to making their advertising more accountable. But look beyond the press release and there are some questions that remain unanswered. For example, is this the biggest case of marking one's own homework we've ever seen? Lund has an advertising-agency background, and the plan has been pulled together by DDB's Les Binet and Sarah Carter - both ad agency planners.

That's not to say that the plan won't go some way to interrogate COI marketing and advertising activity. But, arguably, the model for evaluation would be far more robust were it to be pulled together by commercially savvy, genuinely unbiased parties rather than purely by in-house client marketers and clued-up agency folk.

Then of course, there is the fact that this will all be implemented after the horse has bolted. It's all very well attempting to find out whether your ad campaigns actually worked. But what about an independent process to establish if they should have been implemented in the first place? Do we really agree with the merits of each and every COI campaign? And if you've established that campaigns are necessary, what about looking at whether every cost involved in launching the campaign was a fair one?

I'm not advocating the kind of penny-pinching so despised by all marketers, or the kind of broad-brush cuts that some politicians are threatening. But somewhere in the middle is a sensible analysis of each and every cost, a compromise that protects agency businesses, whilst also identifying wasteful spend so that it can be recovered and reinvested. The COI should be looking to reach this compromise so it can ensure every pound works as hard as possible; preferably before it is spent.

The COI is effectively the largest 'client' in the country with the largest number of taxpaying stakeholders. So, arguably, intelligent and responsible procurement is more important here than anywhere.

Going to Marketing

3rd December

Smooth relationships between UK marketing and procurement functions rest on mutual understanding of what each discipline does, experts have said.

Ray Jones, head of communications at the Chartered Institute of Marketing, told SM that the onus is on marketers to appreciate the value buyers can add to their projects. "It is up to [us] to keep up to date with business and to be numerate enough to work closely with procurement to prove there is a good return on investment," he said.

Purchasers should equally understand the skills involved in marketing, said Rosie Doggett, founder of marketing procurement agency RD Squared. "Marketing is coming to terms with the fact that it should be scrutinised - but it should be scrutinised by people who understand it," she said.

"If a marketing procurement person has not been trained to understand how marketing and agencies work it can cause friction and they will be frustrated because they won't be able to help," said Doggett.

However, US marketers last month accused procurement of being "obsessed" with cost and return on investment.

"With global procurement leading creative and media discussions, disaster is surely on the way," said Frank Cooper, PepsiCo's chief marketing officer for sparkling beverages, in a report in Advertising Age.

This opinion contradicts the findings of two studies published in Europe this year. In November SCM consultancy BrainNet found effective purchasing can ease pressure on marketing budgets, while a separate survey in July showed many marketers welcome procurement's involvement in creative spend.

November 2009

Clean sweep at COl

5th November

I was relieved to hear Mark Lund mention the huge pressure the COl will be under to use (our) money more effectively, as well as the need to be the right size, with the right practices to operate efficiently (MW 22 October).

With, in all probability, an incoming Tory government promising to halve budgets, the pressure he will be under to make cuts will be significant. but any fool can halve a budget. It is absolutely key that Mr Lund maximises the effectiveness of the COl's marketing spend, which at £540m will need considerable justification to the taxpayer.

However there are a number of other issues he will have to deal with too. First, if he intends to "capitalise on the government's digital engagement programme" the COl needs a rapid re-education in how to buy the likes of viral, search and social media campaigns, because to date there has been a real lack of understanding with a resultant black hole in spending.

Secondly, there have been mixed messages regarding the COl's marketing rosters, and this needs clarifying. With drastic reductions mentioned for media, yet apparent proliferation planned for design, I would like to hear more about exactly how he will ensure that they have the right number of the right agencies, at the right price, across the board.

Overall, this is a great opportunity for Mr Lund. But if this new broom is to really sweep clean, he must take a serious look at the COl's existing assumptions about what is a falf price to pay for marketing services.

October 2009

Roster shake-up at COl may not boost efficiency

15th October

I read with interest that the Central Office of Information is splitting its 'design and creative for print ' roster into three new frameworks in an attempt to speed up the procurement process (News, DW 24 September), but I fear this may only serve to exacerbate the real issues involved.

A roster should consist of the right number of the right consultancies, which receive the appropriate remuneration that their work deserves.

If the European Union directive requires that 'all suppliers on a framework capable of performing a contract [are] to be invited to compete for every piece of business', then I would ask how many of the 63 consultancies that are currently listed feel that they are getting their fair share of briefs, and therefore revenue, even before the number of consultancies proliferates.

Also, are they all to pitch on a continuous basis?

Given that many consultancies with in the design and branding spectrulm are multidisciplined, should the taxpayers' money really be spent on managing another roster of, for example, 'brand engagement and guardianship' consultancies which, in all probability, are equally capable of providing brand valuation services. By cutting one roster to create 11 more, will consultancies really see the benefits of increased procurement efficiency?

I'm sure that the design industry will respond diplomatically, but the COl should ensure that it has the optimum number of consultancies so that each can rely on getting regular work, having invested so much time and effort in getting on to the COl's coveted rosters.

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