Marketing: focus on media not 'magic'

Purchasers should concentrate less on trying to influence the "creative" side of marketing and more on trying to reduce tangible costs. Robert Shaw, professor of marketing at Cass Business School and the director of the Value Based Marketing Forum, told buyers at a conference in London that procurement is overlooking the best areas to save money in marketing spend.

Although only 20 per cent of marketing cost is spent on its creative or "magic" side, many buyers focus on this for cost savings because they see marketers as "busy fools".

"Most procurement action is on the creative side rather than the media. Why are you spending the effort on the things that cost less? More drive on the media side could deliver better pay-offs than the creative side."

He added 80 per cent of spend on the media element, such as where to run ads, is largely "hands-off" for purchasers, because media buyers acting on their behalf are trusted to secure deals. But Shaw warned purchasers ought to be more aware of the value of spend.

"Don't assume that even if you know the cost, you know the value. People are throwing away millions of the media budget on things that are not effective."

But Alison Hoad, vice-chairman at Rainey Kelly Campbell Roalfe/Y&R, the agency behind the recent "Your M&S" promotion, said figures are not the only way to measure the success of a marketing campaign.

"You need to look at everything in the round," she said. "It is not enough just to look at a number, you have to understand what you want to achieve."

Shaw said purchasers could be key in making marketing more efficient. "The process is an absolute mess and it's all over the place. People spend more time chasing signatures [to get things signed off ] than being creative. This is a process improvement problem that procurement should be tackling. It is a long-term investment. The bad side is that it drives costs up."

He added because of a lack of "commercially-astute" marketers, procurement is in a "pivotal position to catalyse and drive through change". But he argued buyers need to avoid being sidelined, as the role of marketing changes within companies.

New research from CIPS into the relationship between the two departments revealed that despite greater collaboration, perception of the roles remains the same. Procurement's greatest asset is still believed to be improving cost-effectiveness and contract negotiations. Improving supplier relationships was seen as the fourth most important benefit.

This news article first appeared in Supply Management Magazine 04/10/07

Supply Management is the official magazine of the Chartered Institute of Purchasing and Supply (CIPS). The institute has over 34,000 members, based mainly in the UK but also overseas, and is one of the world's foremost bodies for purchasing and supply management professionals

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