Procurement is the 'marriage counsellor' between agency and client
Apr 8, 2015 9:48:00 AM
I’ve been noticing more and more the disconnect between agency fee and creative output. My observation is that a significant number of buyers (more than you might think) that pay a premium on agency fees, rarely get the best creative work. This observation fuelled a recent panel discussion I sat on during this year’s Advertising Week Europe.
The session, chaired by Kevin Chesters (Executive Strategy Director at mcgarrybowen London), discussed this observation and facilitated the debate around what is needed to overcome the disconnect between cost and value.
In my experience the dynamic between agency and client typically goes one of three ways:
In the first scenario: The client’s demands or limited curiosity around alternative solutions can drown out the true value an agency can bring – regardless of whether the new solution is a strength of the agency.
In the second scenario: The dynamics are reversed and the agency pushes their agenda (and definition of value) onto the client – who may not be best placed to challenge the recommendations (pertinent in untested digital areas) or hasn’t set out clear metrics or indicators of a success.
The third and worst case scenario: Neither the client nor agency make any strong demands – in essence, the relationship becomes stale. In light of these dynamics, I firmly believe a third party is needed to intervene, disrupt, probe, facilitate and bring an independent view of the relationship – focused on delivering the best output. I believe procurement can effectively act as this third party – the ‘marriage counsellor’ between agency and client.
However, unlike a marriage counsellor - who usually steps in when things have gone wrong – procurement can and should be brought in from the start. When bringing on a new agency, procurement can act as the ‘go between’ at the various commercial points to ensure expectations on both sides are being managed; it can handle any of the tough commercial discussions that could potentially damage a new relationship; and can ensure the relationship has the greatest chance of being a harmonious one. One that focuses on the strengths of both sides to deliver the best creative, and the best value – as agreed by both sides.
However, not all procurement is equal. Basic procurement will cover the inputs, rates, hours and roles but nobody gets fired for a bad hourly rate, so you need more than that. They get fired for disappointing output or underwhelming impact, which usually all stems from misaligned expectations and unclear briefs.
Good procurement will spend time on behaviours, processes that enhance productivity and measures of success, as well as the pricing and account team structures. A key learning from my own experience is that good procurement is adept at ensuring both sides are listening to the other, and not just applying a sourcing template in the hope of driving a saving.
But, great procurement understands that every relationship is different and requires a different approach to drive the best outcomes. Great procurement is agile, commercially minded and able to adapt to the changing dynamics on both sides of the relationship, without losing focus on the common goal – delivering the best creative output.
As always, please add your thoughts and comments to the section below.