Value at the time of the virus
Marketing procurement can help brands and their agencies in this rapidly-changing environment. Laura Forcetti, WFA’s Global Sourcing Lead, explains how.
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It’s been an extraordinary two weeks for many in marketing and many senior global executives are struggling with challenges they’ve never faced before. WFA’s Global Sourcing Board has put together seven tips that might be helpful to colleagues around the world.
First and foremost, it’s time to remember relationships and focus on trying to help each other in the spirit of solidarity that this crisis has engendered. Those who are partnering now and in the next ten weeks, may well remember this point for the next ten years. And we see a great opportunity for marketing procurement leaders in enabling some of these discussions.
That means putting value well ahead of savings and demonstrating what marketing procurement means by ‘behaving as a strategic brand business partner’.
Our role is to create “trusted partnerships and keep the relationships internally and externally balanced and prosperous,” said Ekaterina Agafonova, Global Strategic Sourcing Director Commerce, Heineken.
“Most of the business stakeholders are focused (rightly so) on keeping lights on, and we in procurement are well positioned to orchestrate top-to-top engagements with our agency partners, help them feel part of the company, and facilitate ‘creative’ brainstorming on how to thrive together,” added José Gonzalo Bisquerra Mora, VP Marketing & Sales, Global Procurement, GSK.
Our seven tips* are:
Get in touch with external partners. Each agency or supplier will need to be treated individually. Have regular catchups and be helpful – because now, more than ever, we need to behave like partners. We will all benefit from a healthy, sustainable, marketing ecosystem.
Show empathy but keep it real. There are more than enough compassion-style messages around so communications should focus on a personal tone and get to the points that are essential. Opt for calls rather than email, with camera on if online, as much as possible, whatever time zone you are in.
Annotate next steps
At the end of each strategic call with a partner write a short overview capturing key elements agreed throughout the meeting and ensure everyone is in line with next steps. Include the names of the participants to the call for easy follow-up.
Review all your partnership or commercial terms
That means scope of work, remuneration models, payment terms, performance evaluations… such as:
- The activity you cut on day one may not have been vital and the crisis can be a good opportunity to identify what actually maters. Learn from the crisis and apply these learnings on the long-term (post crisis and beyond);
- Ensure that those partners who are on a deliverable-based remuneration model can survive if projects are post-poned and that those who are performance-based can still achieve their KPIs, during and after the crisis;
- There is no one size fits all answer in regard to payment terms. Get in touch with your external partners and discuss potential solutions, together; and,
- Rethink your performance evaluation criteria as the old KPIs probably won’t work. That will require everyone to reset their business expectations and connect with stakeholders and agency partners to agree on (new) metrics that make sense, both during and after the crisis.
Boost your agencies’ creative thinking
Create opportunities for them to share ideas with all your stakeholders – including your CMO. Agencies may have capabilities that you never explored before and these could become essential for your business moving forward.
Share your experience
Promote best practice across your team and markets consistently. In particular, the experience of APAC colleagues who have been experiencing coronavirus for longer may be hugely helpful.
Now may not be the ideal time to pitch an agency
Assess possible risks for your incumbent partner if they lose your business and if you still have to proceed for business purposes, make sure your process is fair and transparent, and driven by long-term objectives.
Among many other elements you will need to review your proposed goals and adapt your selection criteria. Pitches can create opportunities to build new relationships, but it will be hard to assess the chemistry between the teams (client and agency) in a conference call.
Anticipate the ‘back to business’ period and have a post-crisis plan in your brief. Ensure you will still be able to honour your scope of work, expected volumes and commercial conditions from your tender document in the long-term.
“It’s time to take everything back to zero. We should be rethinking our relationships, our budgets, our priorities and going back to the basics of marketing. Identify what’s likely to work now and in the future, while stripping away all the stuff that’s been layered on top of what really matters. Marketing Procurement can be an essential part of this process,” says Myriam Bénichou, Global Marketing Sourcing Director, L’Oréal.
To help brands navigate these exceptional circumstances, WFA is also putting together a compendium of inspiring and innovative brand initiatives taken in response to the health crisis. To contribute cases, please email us at email@example.com.
*Please note that these recommendations are merely meant as suggestions or proposals. They are not binding in any way whatsoever and WFA members are free to depart from them.
For more information or questions, please contact Laura Forcetti at firstname.lastname@example.org