It’s the time of year when budgets get set for the year ahead. Reading the tea leaves, it looks much like we’re going to continue to face economic uncertainty and political shocks for a while yet. In this climate, many executive teams will be looking at costs, and marketers should do so too.
I have been lucky enough to work in many businesses and there hasn’t been a single one where the advertising and marketing budget couldn’t have been spent better. Thankfully, I also learned there are some straightforward ways to get more with less. So, delight your finance direct by trying out some of these approaches.
Recalibrate the campaign development process
There was a lot written and discussed earlier in the year on the quality of marketing briefs. I’m a huge fan of brilliant briefs and brilliant agency briefings to improve effectiveness. It’s all true: great briefs deliver great outcomes. Plus, they are a key part of driving more efficient operations as well.
Key to saving money without knackering effectiveness is understanding how you, or your teams, are working with your agencies or in-house writers and designers. You want to aim for minimum friction: one brief, one briefing, one agency response to brief, one feedback session, one rework, one sign off.
Marketing teams waste enormous amounts of their budgets on briefing the wrong agencies with poor briefs, not bringing the right decision makers in early enough, using the creative work to refine the strategy, and providing poor feedback. Standardising the brief, the creative development process, and how you work with your agencies could save you a fortune in fees. In one review my team led at a big multi-division company we trimmed 20% off fees, and produced better work. Don’t believe me? Ask your agencies how good you are to work with and how you could be more efficient by working with them better. It will be a sobering conversation.
Leverage your buying power by rationalising your supply chain
Never popular and challenging to do, but a huge lever in saving money and producing brilliant work. Add up all the money you spend with design, digital, social, content and creative agencies. Ask yourself if by consolidating the spend into fewer, better partners, you wouldn’t be able to buy better. Better work, better unit costs. Of course you can. It’s just a question of courage, resilience and priorities.
There will be cultural challenges, each marketer or team will have their favourite agency – that’s why you have too many agencies now. There will be a cost to transition too, and on-boarding takes time. Factor all that in, but if you can re-engineer your campaign process at the same time, putting bigger and better briefs into fewer agencies could save you a fortune, and produce better, more consistent work.
If you want to get procurement and finance on side go a step further and create a strategic sourcing plan: one lead strategic agency, one lead through the line agency, two to three specialist agencies. Boom! In one move you get better buying and most likely better outcomes. I rationalised 20 agencies to one lead agency group a few years ago. It unlocked millions and dramatically improved results.
Get a grip on your media agency
The original sin of marketers is media. For far too long marketers have ignored the critical relationship they have with their media agency, and the price at which they are buying inventory. Most marketers are clueless about the commercial arrangements they have with their media agency, the fees and commissions they pay, or the price competitiveness of the media they are buying. It’s inexcusably lazy and very wasteful. Don’t be part of that crowd.
Media will most likely be the single largest expenditure line on a marketing budget, yet it is probably the most mismanaged.
A couple of pointers:
- Your media agency isn’t buying media for you, they are selling media, that they have bought wholesale, to you.
- The unit price you pay on media will be determined by how well you negotiate it.
- There are lots of different commercial models from fee-based to commission-based. Each drives different outcomes.
Do yourself a favour, employ a good media advisor to guide you through all of this. They are worth their weight in gold.
So, if in the next few months you are challenged by your finance team and their cost cutting accountants to save 10% or even 20% of your marketing spend, you won’t have a leg to stand on, unless you have gripped your media contract, rationalised your commercial relationships and improved your processes already. These really are three great ways to drive out cost without reducing your marketing effectiveness. In fact, they might even make it better.