The Post Digital World talk

I was on the panel last week for Results International. It was called 'The Post Digital World: Tomorrow's ROI Models'.

Now you, like me, must be wondering where does a procurement person fit into that title (not literally of course). I listened very attentively to the three really good speakers before me talking about the holy trinity of DM, data and digital and then Social media:driving ROI and then Procurement!. Andy Collins from Results then did an up date on valuing your business and current market trends.

There were (luckily) a number of themes that I could pick up on and then talk about.

The first one was about a site called Net Haggler, where you could go on and suggest a price that you would like to pay for the item. I suggested to the audience (mainly agencies) that perhaps we could look at building one of these sites to buy agency services !. Sounds an interesting concept perhaps for low value tactical purchases.

Another point that one of the speaker mentioned was that he had never been asked to speak on ROI in the last 2 years. I was really surprised at that as for me this is one of the key areas that I think Client Procurement can lead on. Too often agencies complain that they see Procurement at the pitch and negotiation stage, and then they disappear after that. Diageo do Supplier Relationship Management really well and I saw in Supply Management that my old company, Orange, are rolling out a SRM program. Make ROI part of that program.

Andy spoke about how an agency can maximise its value if they want to sell. Areas such as being a specialist and not a generalist, developing and having key people that engage with clients and manage costs. All areas that we look at in agency selection. As client procurement we can help agencies be better focused on costs and put the processes and disciplines in place to support their growth plans.

So hopefully I held my own - the scores on the door have not been sent through yet.

I have also written an article for Results quarterly bulletin. It is called 'Why a Commercial Threesome can work'. I cover off some of the trends that we need to look at for 2010. If anyone would like a copy of the article then please do let me know.

2010 - the future is measurable

I have been thinking about the key areas that the industry needs to focus on this year. One of the recurring themes is ROI / measurement and relationship management.

I am working on a potential project that is focused on the Press Cuttings part of the PR category. For me it is that the stakeholders should not be relying on this service as the key measure of the sole indicator of the success or otherwise of their investment in PR. It is essential that measurable public relations objectives are set. This will tell them where they are starting from and where the PR programme is heading.

At a basic level they need to look at six steps to set up these objectives up:
o Define the objectives
o Determine the criteria
o Select a benchmark (what does success look like ? to the stakeholders and procurement)
o Select a measurement tool
o Compare results with objectives
o Modify campaign

The other part of measurement is the 'it is good to talk'. It is important that all key supplier relationships are audited. At one of my companies, we invested in a third party relationship audit company to provide a 360 degree audit of us (you can also do it yourself as well) and then our three top agencies - Media, Advertising and Brand. The cost was then split 4 ways as it was important that everyone had an equal say in the process. The feedback and the agreed action planning worked really well. The 2 suppliers I would recommend in this area are Aprais and Relationship Audits and Management.

A lot of the time the results of the audit can then feed into a Bonus or Payment By Results structure. I know that some companies in the Telco and FMCG sectors are rolling these programs out globally to all their key agency relationships. Be interesting to see the data in a few years time of 'investment in the process' versus ' benefits gained in the long term'.

Is this answer to the ' can we measure ROI' question?

Mike from CIPS has forwarded me this press release from the COI on how they are looking to put a common approach in place to calculate the financial effectiveness and efficiency of public sector marketing.

The paper shows that the 1998-2005 Teacher Recruitment campaign not only paid for itself; but should provide returns of another £85 for every £1 spent. While the Tobacco Control campaign, is estimated to have saved the economy £7.1bn; against an advertising spend of £49.3m between 1999-2004.

The paper proposes a series of universal definitions to ensure practitioners adopt the same terminology and outlines a 10-step process to help government communicators determine sensible and robust estimates of Payback - the absolute financial benefit delivered by marketing - and Return on Marketing Investment (ROMI) - the number of pounds of Payback delivered, less the cost of the marketing - for every pound spent. It also provides six key principles that should underpin this.

Here is a link to the PDF on the COI website - click here.

Thursday part 2

I presented at the MandM Briefing on Thursday afternoon on Advertising strategies for the upturn. My fellow presenters were Guy Abrahams from ZenithOptimedia, Peter Walshe from Millward Brown and Nick Manning from Ebiquity. It was very well attended and we had a very panel discussion on topics such as measuring ROI, whose role is it to put measurement in place and the role of new technology in the media mix.

My bit was on the trends in the media world from a procurement / client viewpoint. I said that it was mainly focused on 2 key trends: Procurement is here to stay and (more) focus on Openability (not sure that is a real word!) and Accountability.

I thought that the whole briefing and panel discussion were good as procurement were seen as equals in the discussion topics and really able to contribute to the what is the future of advertising and advertsing budgets, and what we can do to help.

Copies of the presentations can be seen on http://mandmglobal.com/content/SocialNet/adknowledge/147896541236987453/198605334