Why Marketing & Procurement Are Now Friends | OLIVER
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For a long time, Marketing and Procurement didn’t get along.

This was all down to an ever-present tension between the scale of marketers’ ambitions, and the real costs of realising these ambitions – often without a measurable return.

This tension, however, is now a thing of the past: something that’s no more evident than in the ProcureCon Marketing event in London, which OLIVER is attending this week.

So how come the rift was healed?

As we see it, the unification of these once disparate and warring business entities in new age of collaboration can be pinned down to four key factors.

1: Omnichannel

The proliferation and diversification of media channels has made it more difficult to figure out how and where to allocate budgets.

Procurement can lend a hand to marketing departments here – or as Procurement Leaders’ Tim Burt puts it:

“This rapid pace of change is focusing minds on the way marketing spends its money… This has had marketing turning to procurement in order to tap into their expertise in these areas.”

Marketing can also bring a reciprocal benefit to procurement here…

2: Disruption of the Funnel

Marketing used to be a commodity: procurement of single-use campaigns for distribution via a specific allocation of media space.

In other words, you chucked money into one end of the funnel and watched a campaign come of the other end.

You never saw the money again.

The funnel model, though, is now considered to be a poor reflection of the customer lifecycle, now better understood as a merry-go-round where the main goal is to stop your customers falling off.

This is the kind of thinking that makes procurement people happy: less money lost on acquisition, and spend invested in repeat business.

The money comes back around.

3: Marketing as a Service

This does mean, though, that marketing services can no longer be easily commoditized.

Before, if you didn’t buy a TV ad and just went with a billboard campaign instead, then all you lost was the reach for the TV ad.

Today – to take retail as an example – it you buy digital ads, but you don’t buy merchandising and CRM, you’ve got people dropping off the merry-go-round like flies.

Or, to put it another way:

“Marketing procurement is more like buying parts for the space shuttle. Every detail is crucial for the success of the business.” [1]

This ultimately means that successful procurement of marketing is now going to depend on securing long-term value from your supplier: one who still cares about your customer months and years down the line, rather than just caring about getting them through the door.

4: Transparency

The view of procurement expert Tim Burt is that, “transparency in costs is essential to maximising every pound spent on advertising.”

Transparency has always been woefully absent in traditional marketing structures; but you always knew that some unspecified sum of your marketing investment was getting splurged on swanky office space and ping pong tables.

In fact, it’s estimated that only 40% of digital ad spend ever actually reaches the audience, and instead gets sucked up by unidentifiable middlemen and unspecified fees[2].

Fortunately for procurement professionals, this is no longer the case: marketers have become obsessed by data and ROI – and technology and digital advertising has made this possible.

In turn, it’s now a lot easier for procurement professionals to tick boxes on their balance sheets and account for expenditure.

New Relationship; New Model

What does all this mean?

Here at OLIVER, that’s something we never forget. It’s simple: marketing is no longer an expense; it’s an investment with a measurable return.

Sure, we’re marketers at heart, and we’ll probably never quite grow out of our weaknesses for awesome TV ads and the occasional game of ping pong.

But we also know what matters to procurement professionals – and our unique inside agency model just so happens to be a perfect fit for their needs.

To quote our very own Rob Green:

“We always guarantee sustainable benefits for marketing and recruitment.”

So if you’re a procurement professional, and if you’ve had it up to here with marketing, why not drop Rob an email?

He gets all this marketing/procurement stuff. He’ll listen to your problems and he’ll understand where your last relationship with marketing went so badly wrong.

And when you’re ready, he’ll show you how we do things here at OLIVER.

Just think – a new, harmonious and highly-productive relationship with marketing could be just one email away…

~

Robert Green, Managing Partner, OLIVER Group

Robert has sat on the board of OLIVER Group since 2009, overseeing all aspects of business development and marketing. 

He started his career at Haymarket and has over 20 years experience in building creative and marketing services solutions for likes of Starbucks, PepsiCo, Vodafone, BMW and other global brands. 

Robert’s career has spanned the UK and USA. He now oversees global business development for OLIVER Group.

 


All references to ProcurementLeaders.com

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