WHY AD AGENCIES NEED TO WORK WITH PROCUREMENT

Our New Business Barometer highlighted Procurement as a key challenge for agencies seeking to win new business.

Here, Tina Fegent, an industry-leading Procurement Consultant, argues that engaging with Procurement early, developing a good working relationship and building trust, is a strategy all agencies are well advised to pursue.

Often an agency person’s view of Procurement is based on agency hearsay and not always on fact, and that is why I started my JFDI presentation with a quote from the astronaut John Glenn ” “As I hurtled through space there was only one thought in my mind – that every part of the capsule was supplied by the lowest bidder”.

Yes, procurement is there to manage the costs and all the commercial and regulatory elements of a client:agency (supplier) arrangement. But the role is varied and Procurement is a key partner that agencies have to engage with, as soon as they can, whether it be at the start of a new pitch process or when a new buyer starts in the client organization – and is therefore new to buying marketing.

We can pull together the agency long and short list for a pitch (tender); we can manage that process; we can often be the only ones reading the RFI and RFP documentation; we can be undertaking the credit scoring checks (how much the Directors are paying you and how expensive London rent is!).  We can draft and negotiate the contract with you; we can put KPIs and SLAs in place (how we love our acronyms); we can put a SRM (Supplier Relationship Management) process in place; we can talk to you about different remuneration structures and we can talk to you about audits and regular reconciliations, as well as ways of working (we know your pain of endless re-briefs and artwork amendments).

One of the trends that I shared with the JFDI attendees was that good procurement practitioners are becoming agents of change. They are getting involved at the start of the business planning and budget process with their marketing teams. They are looking at driving added value from the supply base; examining holding company deals; reviewing and gaining efficiencies in ways of working and putting auditing and transparency at the heart of the commercial relationship – with regular commercial reviews and annual 2 or 4 way client:agency appraisals.

Agencies often neglect or don’t feel that they need to sell to procurement. You certainly do if they are drafting that short list. It is key that agencies understand their clients’ procurement processes. They need to engage early and really work to build up the trust between both parties. A good relationship with procurement will honestly benefit all.

Tina Fegent

 
If you’d like to discuss some of the key findings in our New Business Barometer, please contact camilla@jfdi.uk.com