Let’s face it: Marketing and Procurement teams don’t always see eye-to-eye. Both teams have a different set of goals and measure success using different KPIs. But does this have to be the case? Last month, we took a look at a few indicators that suggest the divide may not be as wide as it once was – with a few key moves on Procurement’s part, 2015 just might be the year that gap closes.
A Primer on Changing Perceptions
Marketing needs a mentality shift when it comes to understanding what Procurement brings to the table. But we can’t expect a change to happen on its own; to change mindsets, we must give Marketing a reason to reevaluate Procurement’s capabilities.
- Plan on tackling data-driven spend first. Digital advertising is poised to overtake other forms of advertising within the next year according to Advertising Age. This is great news for Procurement, as analytics packages track activities related to this spend in ways that weren’t possible with more traditional outlets like billboards and TV spots. Your best bet is to tap your friends in the tech department. IT professionals have long since recognized their importance to marketing objectives, and have started growing relationships to facilitate those interactions. Your organization likely already has technological tools in place that prove (or disprove) the value of marketing spend in quantifiable terms. Procurement has an excellent chance to join in on that relationship.
- Start building category expertise now. A marketer’s number one concern about working with Procurement is that Procurement isn’t going to understand the nuances that make more expensive providers often a better fit. Likewise, relationship building is typically a crucial goal for Marketing, and many marketers fear their efforts will be undone if cost-cutting initiatives disrupt such growth. Proven category expertise will put these fears to bed. Understand the process for agency selection and the KPIs around ad spend. While learning the tricks of the Marketing department’s trade, you’ll be in a prime position to bring tangible analysis to these processes. Supplier/Agency Relationship Management programs can go a long way in helping Marketing stay efficient while improving relationships with agencies rather than harming them.
- Consider outside help. Bringing in a procurement consultancy from the outside has a few key benefits. First, such a consultancy will have the category expertise and relationship-building prowess described above. Additionally, specialists brought in from the outside will remain a mediating force, remaining close to the goals of both Procurement and Marketing while still standing outside of any political posturing.
Proving Procurement’s value to Marketing
Forming solid relationships from the start requires taking a page right from Marketing’s textbook. In other words, Procurement needs to market itself to the Marketing team.
Procurement understands the value of forming relationships with other departments, but Procurement teams need to be able to convey that value to Marketing. So what’s Procurement’s best bet for a sales pitch? Source One’s Marketing Insight Report outlines a few key points that Marketing should be made aware of:
- Improved Decision Support: Procurement can help Marketing better leverage existing relationships by evaluating the supplier landscape and realizing the full-picture value for each dollar invested. Procurement can also help build an Agency Relationship Management program to reduce risk, ensure top-level performance, and unlock additional innovative opportunities with agency partners.
- Targeted Benchmarking: Procurement can identify areas of improvement in agency compensation structures and contractual terms and conditions so Marketing can optimize their budgets.
- Improved Contracting Process: With experience in shaping contracts of all types, Procurement can handle all administrative and management tasks associated with a contract to lessen the burden. Procurement can also help Marketing enhance contracts to include KPI’s based on metrics that can be tracked on a regular basis, allowing Marketing to effectively measure performance.
Procurement and Marketing may not see eye-to-eye now, but we really do all have the same goals at the end of the day: Deliver the right product to our customer at the best price. The only difference is that Marketing’s customer is external and Procurement’s customer in this case is, well, Marketing!