‘Marketers must work more closely with procurement’

Marketers are being urged to forge closer ties with their organisation’s procurement department following recent revelations about controversial media buying practices such as the use of agency ‘kickbacks’ and rebates.

The claims featured in a report by the Association of National Advertisers (ANA) in the US last week, which found that the practice of media owners awarding rebates to advertising agencies based on the amount they spend is now “pervasive”.

The findings suggest agencies are not acting in their clients’ best interests when buying media, and follow similar concerns raised by UK trade body ISBA last month. However, major advertising groups such as Publicis and WPP have questioned the validity and transparency of the ANA report.

The report featured heavily in discussions at ProcureCon Marketing, a three-day conference currently taking place in London for marketing procurement decision-makers.

James Arnold, brand director at energy company SSE, speaking at the event yesterday (14 June) said: “The ANA scandal is one of the most shocking and concerning things happening in the marketing industry.”

He claimed that because SSE’s head of procurement was paying close attention to the latest developments in media buying, the company was able to react quickly to the ANA report. “Within one day of that story breaking, we had met with the chief executive of our media agency, we’d presented to the board, knew the actions we were taking and knew where we were at risk.”

Arnold argued that procurement leaders could improve their knowledge of the day-to-day concerns of marketing leaders by taking time out from their day job and “shadowing marketers for a month or so”. But he also urged marketers to make accommodations and include the procurement department in more of its discussions.

“Marketing needs to do better at opening up doors for procurement,” he said. “That means inviting them into more conversations at the top table.”