Why Marketing Is Too Important For Procurement To Ruin

So a major launch happened the other day, but the materials to support it weren't ready. The reason: a poor choice of marketing supplier. The real reason? Procurement.

I can't say too much about the companies involved, but trust me, the client is a very familiar name and like so many "forward-thinking" brands has made the decision that marketing and advertising teams can't be trusted to pick whom they wish to work with. Instead, it all comes down to procurement and the inevitable race to the bottom, which leads to either inferior work or bumped-up invoices.

So I couldn't agree more with betting company Labrokes calling at a London event this week for procurement to change its ways and become embedded into the marketing teams it is tasked with seeking the best deal for.

This is starting to happen, but you only need to ask around for some horror stories that follow some common themes. There's the complete race to the bottom where everything is purely about money. Regardless of quality or what work and extra services are offered, a "lone ranger" procurement guy just wants the lowest figure. When they get it, an incumbent is replaced, warning that those figures are unsustainable. Of course, they are. That's why second-rate teams miss deadlines or produce such poor-quality work it can't be used.

The flip side of this coin is that everything is reduced to the cost of a widget. The canny agency cuts the price of its widget per unit but then says more were involved in the making a campaign and associated assets, so here's a bill for the widgets were priced on and those we couldn't foresee are added at the bottom. At the same time, any brand that isn't coming to them through a procurement department can expect to have its bill bumped up to make up for any cuts the supplier needs to make with the cost-conscious brand it is keen to work with.

This is the reason for the aforementioned campaign being supplied with such poor-quality work that it couldn't be used. The procurement guy is, of course, nowhere to be seen. He's off troubleshooting some other bill, getting it slashed until the brand can only work with rank amateurs who cannot produce quality on time and anywhere near the budget agreed.

Did I mention this guy will generally get a bonus based on how much money they saved the brand? It's not an unusual arrangement. You go in and pretend this is all about consensus, but when you are motivated by a slice of the savings, there is only one way it's going to go. And that person is never there when a campaign has to be delayed or gets off to a false start.

That's why if we're going to have to accept procurement, it has to embedded. You can't parachute a fool in who just cuts prices and then departs. Any idiot can force suppliers to cut their price, but it takes a smart operator working in collaboration to boost value, and not focus on cost alone.

I've written about procurement before, and things are most certainly changing for the better. My calls around adland picked out a maturity curve that starts at the "lone ranger" cost slasher working in isolation to a more collaborative approach where procurement experts are embedded in teams and work toward improving value.

The elephant in the room here is that procurement is needed at all. Marketing' has widely been seen as a cost centre that needs to be moved away from working with friends to working with the lowest-cost supplier. The solution has to be in marketers communicating the ROI of their function and insisting this can only be boosted by working in collaboration with procurement, not having a guy with a calculator parachuted in.

When the savings are calculated the room can be full of people shaking hands. Everyone's happy. When invoices are later bumped up, deadlines missed and work is rejected over quality standards, it's an altogether more lonely marketing department being left to pick up the pieces. 

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