I have read this week about the Bribery Act that comes into force next year and the impact that it could have on the media industry in particular. The Act is there to stop corruption and market distortion, and if you are found to be breaching it, there are unlimited fines for the companies found guilty, as well as a possible ten years for individuals who are found to be offering inducements.
The article in Campaign feels that there is a lot of corporate hospitality and entertaining that goes on the media world, and that is an essential part of the job as it enables the media buyer or advertiser to understand the different commercial mediums that are in place.
Ummm not so sure of that. Obviously as Procurement we are always aware of these types of situations, and in my view everything should be reciprocal so I make sure that I pay my fair share (not that I have that many lunches I have to say). But I don't really agree that you need to experience corporate hospitality and entertaining to understand what you are buying. We Buyers have to understand the market that we are operating in and there are many valuable sources of information and I agree that you cannot beat a face to face, but this can be at the agencies or clients office or over a coffee.
Showing posts with label Campaign. Show all posts
Showing posts with label Campaign. Show all posts
28 November 2010
17 October 2010
Just say no!
I have been working in Korea (hence the radio silence). A very interesting culture and work environment with some interesting impending cultural and commercial impacts about to happen to the client that I worked out with . I hope that we have given them enough confidence to face the challenge.
A good Ed's Perspective in this weeks' Campaign about Agencies learning to say no. It seems (and really not surprising) that agency chiefs are getting frustrated with clients that keep asking for more and for less money, and they are starting to fight back.
I think it is fair if the agency feels that they have been treated unjustly. Be good to see if there are any high profile and reported cases in the next few months of this happening. Watch this space!
I missed out on the reporting of the Sir Philip Green report on cost savings to be made. Apparently the report was only 32 pages long - well that was a saving in itself !!
A good Ed's Perspective in this weeks' Campaign about Agencies learning to say no. It seems (and really not surprising) that agency chiefs are getting frustrated with clients that keep asking for more and for less money, and they are starting to fight back.
I think it is fair if the agency feels that they have been treated unjustly. Be good to see if there are any high profile and reported cases in the next few months of this happening. Watch this space!
I missed out on the reporting of the Sir Philip Green report on cost savings to be made. Apparently the report was only 32 pages long - well that was a saving in itself !!
01 August 2010
ANA Study and strong words in Campaign
The ANA in the USA has just published a report which says that the majority of clients are still using the fee based remuneration system, with only a small minority (1% - very small then) looking at value based output. I would have thought the latter would be higher with the likes of P&G and Coca Cola now looking to operate in this week. Be interesting to see which clients over here start to look at value based pricing in a big way. Here is the link to the article - ANA report.
The letters page in this week's Campaign page 22 has 2 letters of interest. One from David Wethey @ Agency Assessments which leads on from the above mention of value based pricing. David feels that clients and especially procurement people have become use to paying agencies as some form of salary and that we should look at how architects and design shops are charging. True re design agencies - they tend to charge per staged delivery.
The next letter is from someone called Marcus Cauchi (if you look him up he seems to work in sales). His views on the Thomas Cook media pitch are shall we say very strong. His website seems to be written with the same strong view on life. He does make some decent points, and I understand why Campaign has published it as it is a very entertaining ! read, but I do object to the phrase 'guttersnipe procurement monkeys' when he is talking about the recent Belgian pitch where the agencies went on strike. Does he know all the facts and like the Thomas Cook pitch, it is always better to know all sides of the story before making such sweeping comments. But worth a read if you have a copy of Campaign.
The letters page in this week's Campaign page 22 has 2 letters of interest. One from David Wethey @ Agency Assessments which leads on from the above mention of value based pricing. David feels that clients and especially procurement people have become use to paying agencies as some form of salary and that we should look at how architects and design shops are charging. True re design agencies - they tend to charge per staged delivery.
The next letter is from someone called Marcus Cauchi (if you look him up he seems to work in sales). His views on the Thomas Cook media pitch are shall we say very strong. His website seems to be written with the same strong view on life. He does make some decent points, and I understand why Campaign has published it as it is a very entertaining ! read, but I do object to the phrase 'guttersnipe procurement monkeys' when he is talking about the recent Belgian pitch where the agencies went on strike. Does he know all the facts and like the Thomas Cook pitch, it is always better to know all sides of the story before making such sweeping comments. But worth a read if you have a copy of Campaign.
16 July 2010
The aftermath of the TC affair
This week's Campaign has a number of different articles in response to the 'news' that Thomas Cook was 'asking' its pitching media agencies to pay £1m up front. I have not seen an official response from TC Procurement or Marketing but I did speak to someone who is aware of the process, and their only comment was that TC treat their agencies as suppliers - read into that what you want.
So for a guided tour on the articles:
Page 2 - Claire Beale leads with the headline 'Why it's time to say no to damaging fee term's'. This is about the fact that agencies often don't help themselves and likewise there are some clients that will take advantage of this. I agree with this totally and for once procurement isn't blamed !
Page 12 - Tim Williams of Ignition Consulting calls for a better way of charging that isn't link to hours, quoting examples of Coca-Cola (well documented in this blog). I am a great fan of the concept or licence fee - the client pays an one off lump sum for the agreed level of output with agreed parameters e.g. .usage for one year in the UK on TV. Kerry Glazer @ AAR said this week that they are seeing a few more examples of this happening.
Page 18 - Ian Darby has a good view then the TC pitch is running the danger of supporting a "murky and opaque world where agencies collect their wedge in the form of undeclared kick-backs from media owners". I wonder where TC stand with their incumbent agency on unbilled and AVB's ?
then finally on Page 22 - James Kydd ex Virgin Media says that he is sympathetic to TC's demands and that media agencies haven't help themselves so don't deserve much sympathy.
So a jam packed issue on this very thorny topic. I would really love to know the truth on this pitch. Let's see how it pans out.
So for a guided tour on the articles:
Page 2 - Claire Beale leads with the headline 'Why it's time to say no to damaging fee term's'. This is about the fact that agencies often don't help themselves and likewise there are some clients that will take advantage of this. I agree with this totally and for once procurement isn't blamed !
Page 12 - Tim Williams of Ignition Consulting calls for a better way of charging that isn't link to hours, quoting examples of Coca-Cola (well documented in this blog). I am a great fan of the concept or licence fee - the client pays an one off lump sum for the agreed level of output with agreed parameters e.g. .usage for one year in the UK on TV. Kerry Glazer @ AAR said this week that they are seeing a few more examples of this happening.
Page 18 - Ian Darby has a good view then the TC pitch is running the danger of supporting a "murky and opaque world where agencies collect their wedge in the form of undeclared kick-backs from media owners". I wonder where TC stand with their incumbent agency on unbilled and AVB's ?
then finally on Page 22 - James Kydd ex Virgin Media says that he is sympathetic to TC's demands and that media agencies haven't help themselves so don't deserve much sympathy.
So a jam packed issue on this very thorny topic. I would really love to know the truth on this pitch. Let's see how it pans out.
27 February 2010
Don't you just love a great headline
Something like when The Sun printed the classic 'Freddie Star ate my hamster', I am referring to the headline in this week's Campaign. 'Adland hit as billings collapse'. The Nielsen Company data for 2009 has been published and shows that there were rare examples of billings growth for agencies.
Obviously the driving factor of this is the reduction in client income (obvious statement of the week there sorry about that) but we are (and hopefully) starting to come out of a recession, and it is unsurprising that clients have had to reign expenditure in, but it will bounce back. I think the thing that got me about this article was that it was all quite dramatic and only really refers to the fact that things have been tough for clients and agencies in Claire Beale's Perspective column.
Good clients (Procurement and Marketing) will have been open and honest (as many of my clients have been) with their partner agencies to say this is where we are, let's ride this out together and come out the other side all the better for it. I still see bad examples of commercial ways of working from both sides. The Scope of Work is the starting point of all discussions - but whose responsibility is this ? I would think it is the clients but I see agencies completing on behalf of their clients - any views on this (go on - let me know that I have at least one reader for this blog!)
Iris are running their 3rd in their series of Procurement Breakfasts on the subject of Payment by Results. It is on Thursday 11th March, and if you are interested in going, please contact Nicola Osmond on 020 7654 7343, email: nicola.osmond@iris-worldwide.com.
Obviously the driving factor of this is the reduction in client income (obvious statement of the week there sorry about that) but we are (and hopefully) starting to come out of a recession, and it is unsurprising that clients have had to reign expenditure in, but it will bounce back. I think the thing that got me about this article was that it was all quite dramatic and only really refers to the fact that things have been tough for clients and agencies in Claire Beale's Perspective column.
Good clients (Procurement and Marketing) will have been open and honest (as many of my clients have been) with their partner agencies to say this is where we are, let's ride this out together and come out the other side all the better for it. I still see bad examples of commercial ways of working from both sides. The Scope of Work is the starting point of all discussions - but whose responsibility is this ? I would think it is the clients but I see agencies completing on behalf of their clients - any views on this (go on - let me know that I have at least one reader for this blog!)
Iris are running their 3rd in their series of Procurement Breakfasts on the subject of Payment by Results. It is on Thursday 11th March, and if you are interested in going, please contact Nicola Osmond on 020 7654 7343, email: nicola.osmond@iris-worldwide.com.
19 February 2010
Coke and KFC together
No, not my lunch today !- they are both in this week's Campaign magazine.
Claire Beale has written her perspective on the new remuneration model that Coke are rolling out, as briefly mentioned in a blog posting last year. She feels that it is a real gauntlet for traditional agencies and other advertisers, as it is about rewarding on performance and not on time sheet info (which having had to do one myself we all know is not 100% accurate). Claire feels that it is good to have both the risk and reward element in (good old PBR schemes etc) but feels that there are many wrinkles to sort out first.
Page 17 then has a whole page devoted to it with a number of quotes from 'insiders' - which makes me laugh. At least Coke are getting a lot of press out of this. I do like the different approach and I do encourage agencies that I work with to be creative. Put a safe fee structure on the table but give me something that rewards exceptional performance as well. The main sticking point to the latter is having a brave marketing person to speculate with their marketing budget.
Then on page 19 there is an interview with the KFC Marketing Chief. She says that she keeps procurement at arm's length. She is happy that they negotiate with suppliers such as Pepsi but not her agencies. Every one is different and entitled to their view of course. But saying 'marketing services is my territory' I feel is a bit short sighted as I am sure that her procurement team could really help her in all manner of areas - maybe I should contact them !!
Also there is an interview in Media Week from October 2008 where she was asked "What role does procurement play?". The answer was "In the current economic climate, it plays an increasingly important role in the selection of agencies.".
What changed in a year ?
Claire Beale has written her perspective on the new remuneration model that Coke are rolling out, as briefly mentioned in a blog posting last year. She feels that it is a real gauntlet for traditional agencies and other advertisers, as it is about rewarding on performance and not on time sheet info (which having had to do one myself we all know is not 100% accurate). Claire feels that it is good to have both the risk and reward element in (good old PBR schemes etc) but feels that there are many wrinkles to sort out first.
Page 17 then has a whole page devoted to it with a number of quotes from 'insiders' - which makes me laugh. At least Coke are getting a lot of press out of this. I do like the different approach and I do encourage agencies that I work with to be creative. Put a safe fee structure on the table but give me something that rewards exceptional performance as well. The main sticking point to the latter is having a brave marketing person to speculate with their marketing budget.
Then on page 19 there is an interview with the KFC Marketing Chief. She says that she keeps procurement at arm's length. She is happy that they negotiate with suppliers such as Pepsi but not her agencies. Every one is different and entitled to their view of course. But saying 'marketing services is my territory' I feel is a bit short sighted as I am sure that her procurement team could really help her in all manner of areas - maybe I should contact them !!
Also there is an interview in Media Week from October 2008 where she was asked "What role does procurement play?". The answer was "In the current economic climate, it plays an increasingly important role in the selection of agencies.".
What changed in a year ?
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