Marketing Procurement Benchmarking, what is it and how can it help you get ahead?
Marketing Procurement Benchmarking is part of the marketing buying process for successful global brands. A benchmark provides a point of reference from which measurements can be made, and therefore it gives Marketing and Procurement a standard by which to measure or judge your marking spend.
Marketing Procurement systems, like RightSpend, provides industry data to benchmark your marketing spend and agency investment against.
The most common questions asked around Marketing Procurement Benchmarks include:
Can I use my own data to benchmark my marketing procurement?
The answer is yes. Of course you can use your own data from internal records and historical spend. And you can use data you and your team have collected via desk research of publicly accessible data. However, this will only give you part of the picture.
Your own internal records and historical data will only provide you a limited view, you’re not seeing what others in the industry are paying, you’re not seeing what a wider pool of agencies are charging and your not seeing what’s being charged regionally in different markets. So essentially, you are in an echo chamber of your own insight.
Publicly accessible marketing procurement data, or data you have collected from desk research, only provides you with insight into rate cards and the costs and fees that agencies are publishing. You are not getting into the detail of negotiated rates, the agency fees that brands are actually paying once they have negotiated the contracts.
By using data that incorporates global markets, negotiated rates, that’s developed across a range of industries, deliverables and agency types, means that you’re getting a complete picture. You get a detailed line of sight into every dollar spent, the value it’s providing, and how that measures up to the agencies on your roster and also across the industry as a whole. The power of this data enables RightSpend clients to reshape their strategies and marketing budget more effectively and therefore, deliver more results in terms of growth and ROI.
How does Marketing Procurement Benchmarking help with my negotiations?
Negotiation is a crucial skill for both Marketing & Procurement teams, as it involves persuading stakeholders, resolving conflicts, and securing resources for your budget. However, negotiation is not just about making demands or compromises. It is also about using data and evidence to support your proposal and gain value for money.
Data and evidence from Benchmarking can be used support your negotiation or discussions, as it provides the facts to inform your conversations. Being able to ask the powerful questions that Benchmarking raises ensures that you have the upper hand in your negotiations.
Before entering into any negotiations, Marketing Procurement need to have a clear idea of what they want to achieve and what criteria they want to use to evaluate the outcome of the conversation. Having really clear goals will help you to focus on getting results. And, using Marketing Procurement Benchmarking data will ensure that you’re raising the most relevant and important concerns or questions with your agencies.
It’s not always about using the data to squeeze the costs right down. Instead, it’s about using the Marketing Procurement Benchmarking data to start the communication. For example. if your agency are showing a variance of 20% above benchmark, you can ask the questions to understand the additional value you may (or may not) be getting for that premium. You can then negotiate based on what you’re happy with. You may be happy to meet in the middle and pay 10% above benchmark based on the facts presented. Just remember to use the benchmark data to find the fair point for all parties.
What role does Marketing Procurement Benchmarking play in meeting my goals?
Data, in particular benchmarking data, enables you to gather evidence to the value you are bringing to the table. With your business goals, team goals, and even personal goals set you need to turn to data to analyse and evidence where you are doing well and where you may be able to make improvements. Use Marketing Procurement Benchmarking data to provide evidence on how you can create efficiencies – be that via savings, more marketing, more creative, or more deliverables.
Marketing Procurement Benchmarking data can be used to take a closer look at:
- project scope
- schedule of works
- agency costs
- risks to the project or budget
- quality of deliverables
- benefits of an agency
- impact of the work
It’s important to analyse the data to identify strengths, weaknesses and opportunities, as well as quantifying the value and return on investment of each project or scope of work. By utilising Marketing Procurement Benchmarking you can achieve your goals based on facts and figures, not assumptions.
How can I get buy-in from other departments for investing in Marketing Procurement Benchmarking?
It’s not just Procurement that should be interested in Marketing Procurement Benchmarking data. Marketing and Finance should be too. We highly recommend having open conversations with your colleagues to discuss the role Marketing Procurement Benchmarking can have on your business.
But, the best way we have found is to let the data do the talking.
Present the data in a clear and compelling way, so that it clearly highlights the areas of change, efficiencies and improvements. Then align this with the business or department goals, vision and budget to paint a clear picture.
Your data story should clearly show areas of change, and draw on comparisons to industry norms that can be used to deliver further efficiencies. Marketing Procurement Benchmarking doesn’t just have to result in bottom line savings. It can also help you to deliver more for your budget, reinvesting the savings into additional campaigns or using it to experiment with channels that you’re not yet exploiting.
Taking a data-driven approach with your Marketing Procurement enables everyone to be on the same page, with clear evidence on what is working and what is not, where improvements can be made, and what’s working well. Being able to show your colleagues exactly where they can make improvements and get more bang for their buck should help you get buy-in.
If you want to see the impact Marketing Procurement Benchmarking could have on your marketing spend, or need help in getting your colleagues on board, speak to the RightSpend team today for a demo of the system.