Project Spring

Revolutionising the perception and contribution

of global marketing procurement

A WFA’s Global Sourcing Board initiative

Introduction to across three continents. Members want to rid the profession of bad
practice and reduce the number of opportunities for negative articles

Project Spring
about the discipline.
Evolving perceptions, however, also requires changes in the way
procurement works with its stakeholders inside and outside each
It’s time for a revolution in marketing procurement. company. Evolution to procurement processes, improving people’s
A transformation from savings to value. understanding of procurement, building new performance KPIs beyond
Project Spring is the name of this movement – a global just savings and involving external partners to ensure a true perspective.
sourcing initiative launched in 2018 and designed to transform This report is designed to help everyone on that journey. Based
the value proposition of marketing procurement. It is on a two-year work, it has identified elements that can impact the
ambitious, bold and very necessary. perception of marketing procurement, as well the progress that has
The leadership comes from the WFA Sourcing Board, a group been made since WFA started to formally raise the topic within its
of highly experienced and forward-thinking executives who can network. It identifies multiple initiatives being independently
create concrete actions and share world-class marketing developed by WFA members to evolve their function and ensure the it
procurement practices. The vision for Project Spring and does not become obsolete, irrelevant or a barrier to business growth. It
the Sourcing Board is that procurement should become the is designed to inspire and end the ‘race to the bottom’ that some
trusted partner of brand investment strategy and play its marketing procurement practitioners are contributing towards;
part in driving the business forward. blindly cutting costs and reducing fees.

The roots of this movement lie in the WFA’s Sourcing Forum, It is not a route-map to perfect practice but
which brings together more than 1300 global and regional the start of a journey. As with any transformation,
marketing procurement experts in multiple meetings each year the drive to create a ‘value in’ instead of ‘cost out’
should never end.

“The role of marketing procurement, as all other supportive “Marketing sourcing should be seen as a world-class GPS
functions, is to enable business outcomes – which to me often for all our partners: our role is to help internal as well
means how can they help me find the best agency talent to as external stakeholders better navigate within
ultimately drive growth. I believe that a successful marketing our organisation and strengthen partnerships
procurement team actively works on more sophisticated means between all parties involved.”
to track and measure agency performance and delivery above
and beyond a cost discussion. There will be many metrics to Myriam Bénichou,
look at and probably not a single one, but ultimately Global Marketing Sourcing Director, L’Oréal
procurement metrics should be focused on growth
and the ROI, both long and short
term, of marketing investment.”

“Marketing Procurement has evolved over time, or perhaps

Beatrice Lindvall, it’s more accurate to say that Marketing has evolved in its
Global Media & Digital Director, approach to Procurement over time. With the benefit of
Jacobs Douwe Egberts hindsight, we can say that greater accountability was needed,
and Procurement was able to provide it. We can also say that
Marketing is now better understood by Procurement,
“Commercial procurement is increasingly a vital connector and with that enhanced specialist knowledge,
between the fast-evolving points of the marketing ecosystem. there is a constructive partnership
We have come a long way and are ready to offer expertise, underpinned by a healthy dialogue.”
knowledge, and innovative solutions to our stakeholders.
We also see our role as creating trusted partnerships and Gerry D’Angelo,
keeping the relationships between our Vice President, Global Media,
partners internally and externally Procter & Gamble
balanced and prosperous.”

Ekaterina Agafonova,
Global Strategic Sourcing Director
“Unlocking growth that is responsible, profitable, consistent, and
Commerce, Heineken
competitive, must become the number one metric going forward to
drive the right behaviors across our marketing ecosystem and have
all aligned behind a common goal. It’s imperative we focus jointly
on the purpose of what marketing is meant to drive, and jointly
unlock value and growth. This should not just
“What we do in marketing procurement is to buy capabilities for be the goal but also the mission and purpose of
stakeholders in multiple ways. We help identify marketing procurement teams of the future.”
what capabilities our business needs – today
and in the future, and how we are going Luis Di Como,
to bring these capabilities in.” EVP Global Media, Unilever

Christopher Kredo,
VP Commercial – Global Demand, Mars Inc.

Project Spring 2
The CMO view
Project Spring was in the spotlight at the WFA global conference in Lisbon in 2019 before we
found ourselves under the stresses and strains of COVID-19. I have been reviewing what
I said at the time and pondering what current circumstances have changed.

Procurement has often been blamed for driving costs down and this when dealing with
agencies has been a one-way traffic system where the pain is taken by agencies,
but the gain entirely goes to the client. The role of marketing
procurement is to ensure that value is delivered
for the client company and for the agency partner.

Marketing procurement is, therefore, in the added value business.

The metrics to track this value can be complex but it’s best to
keep all metrics focused on the desired outcomes for the
business, set clear targets as part of a contract, track and
measure them and ensure that the outcomes are delivered.

At its best marketing procurement ensures that the

rigour and discipline of contracting with agencies
results in business growth and a fulfilling
relationship for both partners, now more
than ever we need great marketing
procurement to deliver.

David Wheldon,
CMO, RBS

“It is hard to know who is from procurement and who isn’t.

This is how it feels at GSK, where procurement is embedded

in teams from top to bottom as a trusted business
partner helping drive our growth agenda.

Our productive relationship has been built over years,

with a relentless focus from delivering brilliant basics on
category management to leading strategic efforts e.g. how to
better resource our marketing organisation with partners, an
extension of our team, in the pursuit of building meaningful
and distinctive brands.

Procurement plays a key role to bring the outside in

and orchestrate truly strategic relationships.

I am inspired by GSK Procurement’s vision to “Fuel GSK’s

Growth Engine”, and therefore it is fitting that our shared
metric is Growth.

The spiky capability of being challengers to complacency and

a catalyst for change would be the superpower I encourage
beyond all others.”

Tamara Rogers
CH Global Chief Marketing
Officer, GSK

Project Spring 3
About this document Content
This document contains insights gained from research
conducted in Q3 2018, which explored the facts and Introduction to Project Spring 2
perception surrounding the contribution of global
marketing procurement, as well as a number of bespoke
The CMO View 3
working sessions instigated by the WFA Sourcing Forum.

All respondents to the survey were senior marketing

procurement VPs or directors, 83% of them having a global About this document 4
strategic role. 65 companies contributed to the initial
study, representing over 16 different industry sectors.
PART I: Marketing Procurement Foundations 5
All had differing marketing and media spend sizes.

Fig. 1 - Number of respondents split by spend on

PART II: Current Perceptions 15
marketing and media in last financial year (2017)

What was your organisation’s spend on marketing

and media in the last full financial year? PART III: The Way Forward 21

>$1.2bn 23
Process 23

$701m-$1.2bn 9 People 28

$301m-$700m 16
Performance 31
<$300m 12

Partners 36
0 5 10 15 20 25

The survey asked the respondents a mixture of factual Conclusion 38

questions related to the respondent’s business characteristics
and of opinion-based questions related to how marketing and
marketing procurement are perceived in their organisations. Appendix: WFA’s Global Sourcing Board 39

The cross comparison of this data has enabled us

to highlight the key characteristics of marketing About the World Federation of Advertisers 40
procurement teams that are perceived positively.

This document also contains insight and contribution

from other initiatives being independently developed
by WFA members’ marketing procurement teams to
evolve their function.

Please bear in mind that this document is not a definitive

guide. Rather, it provides general, high-level information
to assist WFA members when redefining their value
proposition and pushing boundaries. The actions outlined
in this report will be discussed and further developed at WFA
member events www.wfanet.org/events.

Project Spring 4
Part I: Marketing
Procurement Foundations
Marketing procurement as a discrete discipline started One noticeable contradiction to this were the responses
over 25 years ago. There has been suspicion that traditional from those that reported into Finance. Fig. 3 shows a marked
procurement principles can be applied to marketing agencies increase in the belief that marketing procurement was here to
where outputs are not repeatable, and the impacts are hard to stay for those respondents.
quantify and thus value.

Although criticism of the function exists, whether

Fig. 3 - Do you agree with the following statement?
imagined or real, it was reassuring to see that, for most
“I could imagine a world without marketing procurement”
respondents, the procurement role for marketing was
– reporting into finance
still considered as important to their businesses (Fig. 2).

I could imagine a
87% couldn’t imagine a world without marketing
world without marketing 5%
procurement?
procurement - reporting to Finance

Agree
Disagree

Fig. 2 - Do you agree with the following statement?

“I could imagine a world without marketing procurement”
– all respondents 95%

I could imagine a world

13% without marketing
procurement?

Agree

“
Disagree
If marketing procurement does
not clearly appear as a different
87% service from traditional commodity
procurement, it will disappear. It
will be a world of procurement,
not marketing procurement. If
Whilst small, there was a selection of respondents who we do not provide valuable and
agreed with the statement that they could see a world strategic support to our marketing
without marketing procurement. It was assumed that counterparts, our function will be

”
these responses reflected businesses that were distinct to absorbed by marketing operations
those that could not believe in a world without marketing
procurement. In fact, for businesses that had given a
WFA Sourcing Forum member,
clear company mandate to use marketing procurement,
Project Spring survey, August 2018
had high levels of spend visibility or saw that marketing
procurement team added value beyond cost saving,
respondents were equally likely to answer in either manner.

Project Spring 5
The key role of marketing procurement is to be the trusted Where you would think there would be some obvious trends
commercial partner to help maximise brand investment on reporting structure there appear to be none. With the
strategies. A base requirement to be that trusted commercial possible exception of the swing towards operations and
partner is to understand where their organisations’ marketing supply chain for the very largest spenders, there is no
budgets are located and to adapt procurement strategies to obvious trend related to the overall spend on marketing
maximise the return on those budgets. However, that is not (Fig. 6).
a simple task. The survey indicated no clear trend amongst
multinational companies in how marketing budgets are
administered. Fig. 6 - Shifts in reporting lines related
to spend on marketing
Reporting lines as marketing spend differs
Fig. 4 - How is your marketing budget administered?
You can select several options
>$1.2bn 5 15 1 1 1
How is your marketing budget structured
$701-$1.2bn 4 3 1 1

Global Only 6 $301-$700m 7 8 1

Global/Regional Hybrid 7
<$300m 5 6 1
Regional Only 4
0% 20% 40% 60% 80% 100%
Globa/Regional/Local Hybrid 23
Finance Operations/SC CPO CMO CEO Other
Global/Local Hybrid 9

Regional/Local Hybrid 2
Equally, linking reporting structure to the number of years
Local Only 10
that marketing procurement has existed shows no discernible
0 5 10 15 20 25 trend (Fig. 7).

Most respondents’ procurement organisations report to

supply chain / operations team or finance and very few Fig. 7 - Shifts in report lines related to the number of
procurement organisations stand alone and report directly to years that marketing procurement has existed
the CEO (Fig. 5). Reporting lines as marketing procurement matures

15+ years 2 4 1

9-1 5 years 5 9 2
Fig. 5 - Into which directorate does
marketing procurement report 5-9 years 9 10 1 1

Into which directorate does marketing procurement report? 2-5 years 4 6 1 1

0-2 years 1 4

0% 20% 40% 60% 80% 100%

Finance Operations/SC CPO CMO CEO Other

Operations/ Supply Chain

21 Other

33 CPO

Marketing

1 Finance
3
3

Project Spring 6
If we look at how resources are deployed between local, A further look at the same data split by reporting line (Fig.
regional, and global structures then a pattern emerges 10) shows a distinct difference in likelihood of being involved
as the spend level increases. early in the process depending on whether the respondent
reports into finance or operations/supply chain.
Fig. 8 shows how organisations differ in the way that they
deploy their resource as their spend grows. It is probably not Those reporting into finance see a sharp spike in
a surprise that as spend increases, so do average team sizes likelihood of being involved at RFI stage whereas their
at local, regional, and global levels. What is of note is that the compatriots who report into operations will be involved
most marked increase in team size is at a local level. Global at budget setting stage.
teams on average grow by three times from <$300m
This potentially reinforces the view that finance may see
spend to >£1.2bn whereas local teams grow by over eight
marketing procurement as more traditional sourcing
times for the same spend increase.
practitioners rather than to be involved in more strategic
business discussions.

Fig. 8 - Average team size split by how they are deployed

related to overall marketing spend
Fig. 10 - At what point in the sourcing process does the
Average team size per organisational structure by spend
Average team size per organisational structure by spend
marketing procurement team normally get involved?
- finance and operations/supply chain only
50
45 At what stage in the sourcing process are you likely
40 to be first involved? - Finance & SC only
35
30
Local 1. Budget Planning/Initiation
25
Regional of Requirements
20
Global
15 2. First Contact with Suppliers

10
3. RFI
5
0 4. RFP & Commercial Structure
<$300m $301m-$700m $701m-$1.2bn >$1.2bn Operations/Supply Chain

5. Supplier Selection and Award Finance

It is also clear the marketing procurement teams are not 6. Post Contract Management (SRM)

always involved at the earliest stage in the commercial

7. Other
process, with only 31% participating to budget
0% 20% 40%
planning (Fig. 9).

This reinforces the point that marketing teams see

procurement’s involvement more in respect of RFx rather
than at the make v buy stage.

Fig. 9 - At what point in the sourcing process does the

marketing procurement team normally get involved?
At what stage in the sourcing process are you
likely to be first involved?

1. Budget Planning/Initiation of
31%
Requirements

2. First Contact with Suppliers 21%

3. RFI 25%

4. RFP & Commercial Structure 15%

5. Supplier Selection and Award

6. Post Contract Management (SRM)

7. Other 8%

0% 10% 20% 30% 40%

Project Spring 7
Marketing procurement:
What should we aim for?
What should we own?
Marketing procurement is support function with touchpoints Generally, marketing procurement
across the business. Like any functional area, we have our can organize that work in 3 pillars:
own unique expertise that we apply to advance business Operations: there must be an understanding of how
objectives. the company gets things done – the budgeting cycle,
Please note that the words ‘business objectives’ are annual brand planning & briefing, approvals, payments,
intentional. Gone are the days when procurement should have compliance – how work is executed within the ecosystem.
its own set of goals, distinct from the core business operation. This knowledge is key for quick turnarounds and ad-
Many teams have already moved from procurement-only to hoc requests (which tend to arise in marketing).
stakeholder-aligned objectives.

In times when the business is seeking growth, a constant Commercial: This is the toolkit. The role of procurement
tug to cut costs would be an annoyance to the business, a includes transformation work to bridge existing capability
distraction from true priorities. In that case, Procurement’s gaps or plot a course to a future state. Procurement applies
role is to maximize growth versus minimize spending. Any concrete steps on the journey forward with a commercial
business partner function – finance, HR, legal – are tasked fluency and a flexible approach. We should provide clear
to support & enable the business objectives. Why would it be options on how to structure an effective pitch for a decision
any different with procurement? in 6 months or 6 weeks. To suit the need, we know how to
structure a contract; the benefit of work in-house, on-site or
Good procurement means good business partners, and the
off-site; buy or license, and the right remuneration structure.
best partnerships have well-defined roles. We begin with
the objective: growth, ROI, simplification for brand teams,
creative effectiveness, high-quality & cost-efficient content, Marketplace: This is the driver for innovation. We must keep
and on and on. The specific objective is not as important on top of start-ups and new capabilities and look across
as the alignment with the business. With that, we can our own business segments, and share. Procurement is a
define our partnership. To achieve this objective, what will connector within the business and externally (“bringing the
each of us do to deliver it? How do we support each other? outside in”). Be an ambassador from the future, as our CEO
Because your success is also my success. This is not a RACI; likes to say, and then chart the course to get there.
it is a contract.

Of course, these principles must live in the real world. From my perspective, I have always found joy in this dynamic
Procurement may have different defined roles depending space. Procurement works with all sorts of people – many
on the firm. Some procurement teams focus on functions throughout the business and many disciplines
operations & compliance, while others on sourcing and across partners. We learn every day, and the role evolves
contracting activity. There may be shared responsibility constantly. With alignment in our objectives we are also
with marketing operations teams. The idea is to recognize closely connected to the core business, and then our purpose
the importance of all the work and ensure ownership of it, is clear.
wherever it sits in the org.

Tracy Allery,
Associate Director, Global
Procurement, Agencies &
Marketing Excellence,
Mondelēz International

Project Spring 8
More than 4 in 5 have a company mandate in place asking Less than half have full visibility on their total
marketers to involve procurement in their projects (Fig. 11). marketing spend, and only 33% address 80-100%
of it (Fig. 13).

Fig. 11 - Does your company have a mandate/policy to

work with marketing procurement? Fig. 13 - Levels of addressable spend across respondents

Average team size per How much of the

organisational structure total marketing
by spend No
spend is addressable
16% by procurement?
81-100%
61-80%
33%
40%
Yes
84%

31-60%
0-30%
25%
2%

However there appears to be a wide variety of thresholds in However, the data showed that the greater the overall
operation before marketers are obliged to involve marketing marketing spend, the higher the levels of addressable spend
procurement (Fig. 12). (Fig. 14).

Fig. 12 - If there is a mandate that procurement Fig. 14 - How addressable spend is related to
must be used then over what threshold does it operate overall spend levels

If you do operate a mandate, at what level of spend? How overall spend affects the level if spend is addressable.

No Threshold 23%
>$1.2bn 2 9 11

>$25k 6%

$701-$1.2bn 3 4 2
>50k 23%
0-30%

>$75k 3% 31-60%
$301-$700m 5 6 5

>$100k 34%

<$300m 1 5 5 1
>$250k 11%

0% 5% 10% 15% 20% 25% 30% 35% 40% 0% 20% 40% 60% 80% 100%

Further comments from WFA members included:

1. “Depends on geography - starts with 0”; 7. “50K+ Euro mandatory triple
bidding; 100K Euro mandatory early
2. “Bidding thresholds are set at local level”;
procurement involvement”;
3. “$250K, however, there are no penalties
8. “Depends on the category within marketing,
if you don’t engage”;
and/or if it is local or global engagements.
4. “No specific spend threshold as market can range from a minimum of $0 - $500k”;
budget scale varies”;
9. “In the US: if the annual spend is >$1m,
5. “Over $50k, and marketing procurement must procurement needs to be involved. Outside the
approve any new supplier”; US: if the spend is > $250k”;

6. “Policy states spend >$50k USD requires procurement, 10. “Policy varies according to the entities and the
but we are involved with all levels of marketing spend due specific spend. The threshold is defined to
to our alignment with the business”; reach a coverage of 80% of the spend”.

Project Spring 9
Shifting to procurement with purpose From sourcing to resourcing marketing
We believe that procurement and therefore marketing What is our role as procurement leaders? Big question, lots of
procurement, cannot be fully successful without a clear and answers I am sure. As the procurement function evolves and
meaningful purpose. It is this clarity around purpose that takes a more protagonist role as an enterprise thought leader,
should form the foundations for the function, and it starts we must continuously challenge ourselves with this question.
from revisiting and evolving how we consider the value we can
The word ‘sourcing’ is directly associated with buying or
deliver.
procuring a solution, and in an industry where Talent and
The objectives and metrics of best-in-class marketing Growth are everyday key words, I would like us to challenge
procurement departments of the future should not be ourselves and explore moving the conversation from
purely about savings but also more focused around enabling ‘sourcing’ marketing services to ‘resourcing’ an end to end
the growth of the company and bringing responsible and ecosystem of Talent for our account, incentivised to drive
sustainable sourcing to the top of the agenda. It is the evolution the Growth of our business.
to ‘procurement with purpose’ and about an aspiration of
To make this pivotal mindset change, from sourcing to
more holistically supporting marketing, the company, our
resourcing, we must up our game as a function to really
consumers, and the community. With this lens, procurement
understand the categories we are managing, the industry
is ideally placed by bringing sustainability and responsible
we are dealing with (and how it works), and get to know the
sourcing to the top of the agenda of supplier meetings, driving
agency people we are interacting with. Our agencies are an
the right incentives that go beyond just cost reductions and
extended part of our internal marketing organisation, and I
making great sustainable innovations scalable.
feel that we sometimes forget about this.
Pivoting the conversation more broadly around what good
As a function, we are amazingly well placed in
looks like, introduces a much broader thinking both internally
procurement to play this resourcing advisor role for
and externally, around the value levers and forms of value. It
our marketing peers. Here a few reasons why:
broadens the focus of the relationships and you start to explore
a wider variety of high impact ideas, from unlocking growth 1. We are very externally focused and can bring innovative
opportunities in new channels to all the way of ensuring use of ideas on how to ’resource’ different campaigns or business
sustainable materials in point of sale. Therefore, the successful challenges;
marketing procurements of the future need to rethink the 2. We know how ‘spend’ translates into ‘resources’ and how to
role they can play and redefine their purpose, objectives and best design solutions to maximise output;
metrics around the broader contribution it can deliver based
on this strategic mindset. 3. We understand how to best incentivise our agencies to
produce great work; and

4. We have a view on both internal and external worlds and

Tuomas Anttila,
can advise how to best resource the end to end marketing
Director, Global Marketing ecosystem of talent.
Procurement, Unilever
Our role as growth contributor has never been so evident,
however, to unlock the power of the marketing industry to
deliver our company’s ambitions, we must truly understand all
the resources across the end to end ecosystem. Performance
based remuneration is a key milestone in driving business
performance with our agency partners, however we, in
marketing procurement, need to go much deeper to make the
shift from sourcing to resourcing marketing with every talent,
tools, resources that our business needs to drive Growth.

Jose Gonzalo Bisquerra Mora,

VP Marketing & Sales,
Global Procurement, GSK

Project Spring 10
As expected by the marketing procurement teams of If one looks deeper whether organisations are more likely
the largest global spenders, visibility of spend data is to have high levels of spend visibility depending on their
generally good. In Fig. 15 we can see that nearly 50% of characteristics, then one can see that:
respondents have a strong suite of spend reports. However,
A. There is loose relationship between spend size
there are still a number who have no visibility at all.
and the likelihood of having better spend visibility (Fig. 17).

B. The more mature (e.g. years it has been operating) that a

marketing procurement team is the more likely it will be to have
Fig. 15 - What level of
visibility is there on the greater spend visibility (Fig. 18). However, best practice can be

marketing and media spend? achieved in the medium term: a decent level of spend visibility
No visibility
By Supplier 3% can be secured within a few years.
What break down in spend 20%

data do you have? By Category

C. If there is a mandate to use marketing procurement, then the
28%
business is more likely to have higher spend visibility (Fig. 19).
By Brand, Market &
Category Interestingly, there are a number of factors that appear to have
49%
no linkage with high levels of spend visibility. Namely;

4. Reporting lines do not make a difference: the fact that the

procurement team reports into Finance does not automatically
result in higher levels of spend visibility. The same success can
When one combines the data from Fig. 13 and Fig. 15 then a
be achieved by teams reporting into supply chain for instance.
clear picture appears. In Fig. 16 it shows that there is a strong
link between those organisations that have high levels of 5. Having marketing spend administered globally will not lead to
spend visibility and those that have high levels of addressable higher levels of spend visibility.
spend.
6. Size of budget does not make a difference: even the smallest
A conclusion can be drawn that a key enabler to unlock the advertisers do not necessarily have visibility for their advertising
opportunity to work across all of the marketing spend is spend. Without the right systems in place, all companies will
to have high quality, multi-dimensional spend data. struggle to identify what is delivering best value.

7. Size of team does not matter; there is no automatic benefit from

having a large number of full-time employees on your team to
Fig. 16 - How addressable spend improves increase spend data. We have found no correlation between large
as spend visibility increases teams and a greater level of data.

How overall addressable spend

alters depending on spend visibility
Fig. 17 - How the levels of spend visibility
relate to overall spend on marketing
81-100% 1 2 4 13
How spend visibility might be different across
different sized businesses
61-80% 6 8 10
No Visibility
Visibility on Supplier
31-60% 1 3 5 6 Visibility on Category
Multi Dimension >$1.2bn 16 4 2 1

0-30% 1

$701-$1.2bn 2 5 2 Brand/Market/Category
0% 20% 40% 60% 80% 100%
Category
Supplier
$301-$700m 6 5 4 1
No Visbility

<$300m 6 3 3

0% 20% 40% 60% 80% 100%

Project Spring 11
Fig. 18 - How does the level of spend visibility Fig. 20 - Do you agree with the
relate to the length of time that the procurement definition of hard & soft targets
team has existed
Do you agree with the definition of hard v soft metrics?
How spend visibility might be different as the
procurement team matures

Disagree
5 55
Agree
0-2 years 2 1 2

0 10 20 30 40 50 60
2-5 years 3 4 5
Brand/Market/Category

Category
5-9 years 9 7 5
Supplier How does your line management generally (i.e not just
9-15 years 12 3 1 No Visbility
marketing procurement) quantify the value of procurement?

15+ years 4 2 1

0% 20% 40% 60% 80% 100%

Vague system but based

on financial savings

Well defined system based

solely on hard cost reduction
Fig. 19 - What level of spend visibility does the
organisation have depending on whether there is a Well defined system but also recognises
cost avoidance and cost reduction
mandate to use procurement A process that balances non tangible
benefits against hard savings

How spend visibility might be different if your Other (please specify)

business operates a mandate 0% 10% 20% 30% 40% 50% 60%

0-2 years 2 1 2 There is a wide range of metrics that are used across the group
Yes 26 13 12 that were surveyed.
2-5 years 3 4 5
Brand/Market/Category The data in Fig. 21 & Fig. 22 illustrate the difference between
Category
5-9 years 9 7 5
Brand/Market/Category
teams that share metrics with their marketing counterparts
Supplier Category

No 4 4 2 No Visbility
Supplier and those that do not.
9-15 years 12 3 1 No Visbility

As expected, both groups rely heavily on hard cost metrics.

0%
15+ years
20% 4 40% 60% 80% 2 100% 1
However, the group that share some metrics with their
Fig. 16 - How addressable spend improves
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
marketing counterparts are more likely to use softer metrics
such as risk management, higher quality work or innovation.
as spend visibility increases

Most procurement functions at the time of the survey  

would differentiate hard v soft metrics to demonstrate
the performance of their function. 92% agreed (Fig. 20)
with the following definitions:

A. Hard metrics are those that are quantifiable and possess an

accepted causal link to the P&L. E.g. savings versus budget,
CPM, Inflationary price rise avoidance.

B. Soft metrics are those that are hard to quantify in a

repeatable manner or which have a weak causal link to
business or brand performance. E.g. access to
innovative new tools, more effective agency
relationships, risk reduction.

Project Spring 12
Fig. 21 - Metrics used by procurement teams that Limited amount of metrics used by WFA members
share targets with marketing teams towards a true shared business goal, such as:

Metrics used for procurement teams 1. “Brand value generation”

that share targets with
marketing team 2. “Agency performance KPIs”

3. “Agencies have cross-functional scorecards.

Yes (please provide Finance and Marketing receive monthly
some examples)
47%
53%
reporting on value provided”
No

4. “Stakeholder satisfaction”

5. “No. of markets using central creative work /re-usage

(transcreation)of creative assets”

6. “Viewability of digital media”

7. “Process Improvement (time to close

Most metrics used by WFA members and shared and complete projects)”
with other functions still very procurement centric:

1. “Annual sourcing plan performance & value

delivered v plan” Metrics used for procurement teams that
share targets with marketing team
2. “Cost reduction v budget”

3. “Cost reduction v best offer after 1st revision loop”

4. “Additional services / warranties on agreed cost”

5. “P&L savings”

6. “For media we have a global cost improvement

template that is always shared with our media marketing
community for their alignment before we report savings”

7. “Savings, contracts under management, payment terms”

8. “SLAs and KPI’s are often agreed in contract, however,

stakeholders hardly (of course some do) monitors that o
their daily routines”

9. “Shared savings target and roll-out category strategy”

10. “Key project milestones (marketing/sales), cash-flow

generation (finance), savings achievement (pitch results),
agency roster definition (marketing)”

11. “Working v non working investment”

12. “Cost out targets and value in”

13. “Business case savings”

14. “Involvement in projects – savings – risk

assessment overview”

Project Spring 13
Fig. 22 - Metrics used by procurement teams that It is encouraging that there is close correlation between those
DO NOT share targets with marketing teams areas that have the greatest influence and how they currently
perceive marketing procurement.
Metrics used for procurement teams that DO NOT share
targets with marketing team It shows that, collectively, marketing procurement must be
doing something right and are focusing their attentions on the
Cost Reduction 1 25
right stakeholders.
Cost Avoidance 1 14 12

Stakeholder satisfaction 8 11 8

Increased Efficiency 2 19 6
Never Used Fig. 23 - How do other areas of the business
SRM Improvement 8 11 8
Sometimes Used perceive marketing procurement?
Risk Management 8 13 6
Always Used
Insight 13 12 2
How do other business areas view marketing procurement?
Higher Quality Work 7 14 6

Innovation 8 17 2

0% 50% 100% Marketing 4 4 37 15

Finance 2 7 31 20

CEO 21 26 13 Extremely negatively

The final set of data in this section shows the way that
Legal 3 10 32 13 Somewhat negatively
other areas of the respondent’s business view
Neutral
Supply Chain
marketing procurement (Fig. 23). 3 21 15 21
Somewhat positive
Agencies 1 13 17 26 2
The different areas are ranked in order of those that have Extremely positive
Sales 3 35 18 2
the greatest influence on the perception of marketing
Shareholders 1 37 16 4
procurement.
0% 20% 40% 60% 80% 100%

Project Spring 14
Part II: Current Perceptions

92% felt that the way of marketing

procurement is perceived by their
organisation could be
improved (Fig 24).

Even though the respondents emphatically believed that

marketing procurement clearly demonstrated value (76%
agree) and drove improvement (85% agree), a greater
proportion of the group felt that more could be done to
improve the perception of marketing procurement.

Fig. 24 - Can the perception of marketing

procurement be improved?

I feel that the way of marketing procurement is

perceived by my organisation could be improved?

8% 92%

0% 25% 50% 75% 100%

Disagree Agree

This insight has been echoed during a live poll at

ProcureCon Marketing London 2019 where only five per
cent of the audience said that current perceptions of
marketing procurement were “extremely positive”. While
38% of attendees said they were “somewhat positive”,
such a statistic underlines the need for a fundamental
reshaping of the function.

5% felt that current

perceptions of marketing
procurement are
extremely positive

Project Spring 15
Being recognised for delivering a wider set of benefits Perhaps the most interesting linkage between an organisation
than just cost saving depends on different factors. A perceiving marketing procurement as delivering broader
critical factor in improving perception of marketing benefits is the management line through which the team
procurement is illustrating that a broader set of benefits reports (Fig. 27).
can be delivered.
There is a strong indication that it is harder to be
The survey responses indicated a ‘66% Agree: 33% recognised for delivering more than cost savings if
Disagree’ split on whether the broader benefits were marketing procurement report into a finance structure.
being recognised. Cross referencing this data with other
Note: the number of respondents that reported into the CEO
factors illustrates some interesting linkages.
was not statistically significant.
Fig. 25 shows that the larger the annual marketing spend
the more likely the respective organisation will recognise
the broader benefits that marketing procurement offers. Fig.27 - Perceptions of the value of marketing
procurement split by reporting line

The value of marketing procurement is seen as broader than

Fig. 25 - Perceptions of the value of marketing price reduction by the business - split by reporting line?
procurement split by spend

The value of marketing procurement is seen as broader than CEO 100%

price reduction by the business - split by annual spend?

Other 17% 83%

Disagree
Operations/SC 33% 67%
>$1.2bn 22% 78% Agree

Finance 43% 57%

$701m - $1.2bn 33% 67%

0% 25% 50% 75% 100%

Disagree
$301m-$700m 38% 63% Agree

<$300m 58% 42%

0% 25% 50% 75% 100%

Surprisingly, there is no link between the maturity or age

of a marketing procurement organisation (as measured
by the length of time the discipline has existed) and the
recognition of the broader benefits offered (Fig. 26).

Fig. 26 - Perceptions of the value of marketing

procurement split by maturity

The value of marketing procurement is seen as broader than

price reduction by the business - split by maturity?

0-2 Years 40% 60%

2-5 Years 50% 50%

5-9 Years 38% 62%

Disagree
Agree
9-15 Years 13% 88%

15+ Years 43% 57%

0% 25% 50% 75% 100%

Project Spring 16
When procurement teams have access to high levels The responses from the survey show exactly the same level
of data visibility there is a greater likelihood of their of responses to the question of whether the wider business
organisation seeing the wider benefits that marketing considers the marketing procurement team as adding value
procurement can bring (Fig. 28). regardless of whether the underlying business saw marketing
as a cost or an investment.
A key building block of marketing procurement teams that
have successfully demonstrated a broader value to their Fig. 30 shows that it does not matter whether the wider
business is access to high levels of spend visibility. business considers marketing spend as an ‘investment’
rather than a ‘cost’ for the business to see wider value in
marketing procurement.

Fig. 28 - Perceptions of the value of marketing

procurement split by spend visibility
Fig.30 - Perceptions of the value of marketing
The value of marketing procurement is seen as broader procurement split by the view of marketing spend
than price reduction by the business - split by the
level of spend visbility The value of marketing procurement is seen as broader than
price reduction by the business - split by how the business
sees marketing spend
Full visibility 20% 80%

Visiblity at Category level 29% 71%

Disagree Cost 68% 32%

Visbility at Supplier level 67% 33% Agree
Agree
Disagree
No visibility 100%
Investment 68% 32%

0% 25% 50% 75% 100%

0% 25% 50% 75% 100%

Fig. 29 shows that high levels of spend visibility tend to

exist in teams that have existed for a number of years.
This is likely to reflect that creating detailed spend data is not
something that can be delivered quickly.
Transforming the way your organisation
sees marketing, as an investment as opposed
to a cost may help marketing procurement practitioners
Fig. 29 - Perceptions of the value of marketing
adopt the right behaviours. If your organisation sees
procurement split by maturity
marketing as a cost, they will likely engage with procurement
The value of marketing procurement is seen as broader than to reduce that cost. This can encourage the wrong
price reduction by the business - split by maturity? behaviours, and a focus on savings, instead of value. If your
organisation sees marketing as an investment, it will be
15+ years 1 2 4 easier to persuade colleagues that this investment needs to
be maximised. Nobody wants to cut investment in growth.
9-15 years 1 3 12

No visibility
5-9 years 5 7 9 Visibility at Supplier level
Visibility at Category level
2-5 years 5 4 3 Multi Level Spend Data

0-2 years 2 1 2

0% 20% 40% 60% 80% 100%

Project Spring 17
The perception of marketing does grow as team size Fig. 31 - Whether marketing procurement are
grows regardless of where that team is located. seen as adding more value related to team size

Fig. 31, it is quite clear regardless of whether the teams Does the business see the marketing procurement
are globally, regionally, or locally located, the perception team as adding value beyond cost saving splt by
of marketing procurement as a partner that adds more size and location of team
value than pure cost saving goes up along with team
size. It does not necessarily follow that the bigger the team Global >80
the more value they add, but it does illustrate that there is a Global 31-80
greater chance of adding broader value is there is sufficient Global 11-30
resource to perform the work. Global 1-10

Regional >80
Regional 31-80

Regional 11-30
Regional 1-10

Local >80
Local 31-80

Local 11-30
Local 1-10

0% 20% 40% 60% 80% 100%

Agree Disagree

Perhaps unsurprisingly, the larger the marketing

spend the more likely it is that the business sees
marketing as an investment rather than a cost.

Fig. 32 shows that there is distinct shift from

more than half the responses seeing
marketing as a cost at the lower
levels of spend to just over one fifth
at the upper end of the spend range.

Project Spring 18
Fig. 32 - Organisation’s view of marketing spend As we have already drawn a link between levels of absolute
spend and whether the organisation sees marketing
Does your organisation see marketing as a cost or an
procurement as adding broader value that spend reduction,
investment - split by annual marketing spend
the link between addressable spend and absolute spend may
not be that surprising. However, this link suggests that a key
>$1.2bn 78% 22% enabler for marketing procurement is to ensure that it looks to
address as much spend as possible.
$701m - $1.2bn 56% 44% Investment
There is correlation between the point at which the
Cost
$301m-$700m 60% 40% marketing procurement team are involved and whether
the business sees the team as adding broader value than
<$300m 45% 55%
price reduction.
0% 25% 50% 75% 100%
Conventional wisdom would suggest that if the marketing
procurement team is involved early in the sourcing process
then it becomes easier to generate a broader type of value for
Those procurement teams who work with a high level of the business.
addressable spend are more likely to be seen as adding
more value (Fig. 33). The data from this survey does support this view as those
teams who business’ see them as adding broader value tend
to be involved at budget and RFI stage (Fig. 35).
Fig. 33 - Perceptions of the value of marketing
procurement split by addressable spend Interestingly Fig. 35 illustrates that there is not the same link
for those involved in the first contact with suppliers and hints
The value of marketing procurement is seen as broader than at this involvement point not being as important.
price reduction by the business - split by addressable spend

81-100% 70% 30%

Fig. 35 - How do other areas of the business
perceive marketing procurement?
61-80% 75% 25%

Agree
The value of marketing procurement is seen as broader
Disagree
31-60% 53% 47%
than price reduction by the business - split by initial
involvement point
0-30% 100%

0% 25% 50% 75% 100%

Other 40% 60%

High levels of addressable spend are also linked to the RFP 56% 44%

absolute of marketing spend (Fig. 34).

RFI 27% 73%
Disagree

Agree
First Contact 46% 54%
Fig. 34 - - Levels of addressable spend split
by absolute spend
Budget 21% 79%

Levels of addressable spend - split by levels of absolute spend 0% 25% 50% 75% 100%

>$1.2bn 2 9 11

$701m-1.2bn 3 4 2 0-30%

31-60%

$301m-700m 5 6 5 61-80%

81-100%

<$300m 1 5 5 1

0% 20% 40% 60% 80% 100%

Project Spring 19
Mandated use of procurement does lead to improved Fig. 38 - Perceptions of the value of marketing
perceptions but only if the threshold for involvement is procurement split by whether training of stakeholders
low. Fig. 36 suggests that there is an increased likelihood in takes place
the business seeing marketing procurement as adding more
The value of marketing procurement is seen as broader than
value if there is an official mandate to use the team. price reduction by the business - split by whether training
takes place

Fig. 36 - Perceptions of the value of marketing

procurement split by official mandate No Training 41% 59%

Disagree
The value of marketing procurement is seen as broader than
Agree
price reduction by the business - split by whether there is an Training 26% 74%
official mandate

0% 25% 50% 75% 100%

Non mandated 50% 50%

The insights from this survey has proved to be a fascinating
Disagree
view from marketing procurement practitioners
Agree
Mandate 31% 69% across a wide range of industries.

0% 25% 50% 75% 100%

Certain preconceptions have been

For those that do have an official mandate, Fig. 37 shows reinforced by the data:
that the lower the threshold above which the business is
obliged to involve marketing procurement the stronger A. If you spend a large amount in general on marketing then
your organisation is more likely to see marketing as an
the link to the business seeing marketing procurement investment and, in turn, will have a more positive view of the
as adding wider value. wider contribution marketing procurement makes;

B. More mature marketing procurement teams are more likely

to have better spend data but that doesn’t mean you need
to wait decades for success. Three to four years may be
Fig. 37 - Perceptions of the value of marketing sufficient to create robust ‘muscle memory’ processes and
to ensure the right tools are in place;
procurement split by involvement threshold
C. There is a correlation between marketing procurement
The value of marketing procurement is seen as broader than investing in training for their stakeholders and how those
price reduction by the business - split by initial involvement stakeholders perceive your marketing procurement function;
threshold
D. The bigger the overall marketing budget the higher
percentage of addressable spend we under the influence of
marketing procurement;
>$250k 50% 50%
E. Perceptions of value beyond savings were slightly higher for
$75k-250k 54% 46%
those marketing procurement teams that had a mandate to
use them and increased noticeably the lower the threshold
$25k-75k 29% 71% Disagree
for involvement;
Agree
$10-25k 33% 67%
F. Sharing metrics with stakeholders is closely linked with being
seen as adding more value to an organisation.
Everything 13% 88%

0% 25% 50% 75% 100% Certain preconceptions have been

reinforced by the data. Namely;
Those businesses that perform procurement training
programs within their marketing counterparts’ teams A. The better access to high quality, granular and accurate
tend to be better perceived by them, as delivering wider spend data, the more likely marketing procurement will be
value (Fig. 38). seen to add value;

There is a marked difference between those companies who B. Credibility of the function does not correlate to the age of
perform some sort of training for their stakeholders and the marketing procurement team;
those that do not when it comes to appreciation by those
stakeholders. C. Those reporting to finance had the least positive perceptions
from stakeholders. As marketing spend increased so the
likelihood of reporting to finance decreased.

Project Spring 20
Part III: The Way Forward
Over the past two years, a number of workshops have been
run by WFA with groups of senior marketing procurement
“ It is important to focus on how to
achieve the business goal through
procurement; marketing, marketing
professionals where the core survey data was interrogated
procurement, finance all together
to develop themes and tactics that would help improve the
delivering the outcome. First step: all
perception of marketing procurement.
must agree on the outcome and definitions
Outputs of these sessions grouped into four key areas of it – speak same language. To do so,
of challenges that need addressing, in order to evolve it is key to have a business discussion,

”
perceptions of marketing procurement: and not a function to function discussion.

WFA Sourcing Forum member,

Process: incl. senior management mandate to Singapore, April 2018
use procurement, thresholds for procurement
involvement and levels of addressable spend,

People: incl. company reporting structure, team

“ It’s all about moving from what we’re buying

”
size and structure, the company’s commercial to what we expect what we buy to do.
maturity and understand of marketing WFA Sourcing Forum member,
procurement’s role by marketing, finance, supply Singapore, April 2018
chain, CPO,

Performance: incl. metrics beyond savings

“
and shared KPIs measuring the performance
Marketing procurement is going through
of the business and,
an identity crisis. And we do not spend
enough time on reinventing ourselves. It’s
critical that we take a step back, identify our
Partners: incl. agencies, consultancies, organisation’s short-term need v long-term

”
supporting their clients’ business growth. one, and find ways to contribute to both.

WFA Sourcing Forum member,

More than a third of the audience at the ProcureCon Marketing NYC, December 2018
London 2019 felt that these 4 buckets of challenges were all
equally critical to address, whereas 22% gave top priority
to Performance, 16% to Process, 14% to People and 13% to
Partners.

Project Spring 21
The core values
of marketing procurement,
from WFA’s Global Sourcing Board:

1 Trusted

Productive
2 A value creation mindset

Curious
3 Key to innovation and bring the outside in

Accountable
4 Increasing transparency & tangible measurement

Collaborative
5 With the business and our partners

Skilled
6 Commercial and leadership expertise

Responsible
7 Driving meaningful and longer-term changes

Project Spring 22
Process

From the core survey data, there were a number of clear markers,
when it comes to the procurement process, for organisations
This ‘cause and effect’ topic was
that held a positive view of benefits that marketing procurement
part of the discussions from WFA
can bring. They were:
workshops and, whilst all organisations
1. Early involvement in the commercial process (Fig. 9); are different, a consistent set of
tactics presented itself:
2. A formal mandate from senior management to involve
procurement in the commercial process (Fig. 37); 1. Obtain as accurate and complete spend
visibility as possible;
3. High levels of spend visibility (Fig. 28);
2. Seek or assess the need of an official senior
4. High levels of addressable spend (Fig. 33); mandate for the use of marketing procurement;

5. A low spend threshold before the business 3. Reduce the threshold over which marketing
procurement must be involved as low as the team
involves marketing procurement (Fig. 37).
workload will allow;
What is not immediately apparent from the data is whether
these markers are enablers to marketing procurement 4. Broaden the addressable spend as wide as
possible;
being seen as credible or come as a result of marketing
procurement being taken seriously. 5. Seek to be involved as early in the
commercial process as possible.

Project Spring 23
Spend visibility
Achieving greater spend visibility (and ultimately greater level of Broadening the marketing
addressable or impactable spend) is essential for procurement procurement addressable spend
to view their company’s marketing investments as a whole and for a better recognition
enlarge the range of possible value they can bring. Great data
will allow the function to act at an organisational level rather
than just a brand or geographic level and strengthen their The journey to help improve the perception of
strategic contribution to their business. marketing procurement starts with knowing at least
as much, if not more, about the marketing third party
spend. Whenever I have taken over a category or a new
Official mandate team, the most valuable first insights have come from
good spend visibility.

An official mandate to involve procurement in commercial

relationships can come in many different guises from an Obtaining a great set of spend data from every market
absolute policy statement that obliges all stakeholders for the previous twelve months provides sufficient
to involve procurement to a lighter touch guideline that information to generate insight for productive business
encourages procurement’s involvement. The survey data does meetings. This does not need any expensive software
not indicate what level of mandate will lead to an increase or reporting tools, a simple spreadsheet and a pivot
in perception of procurement however it is clear that those table can be enough. I am looking for the data to show
organisations where marketing procurement are seen as unexpected areas or shapes of spend that can generate
offering a broad range of benefit receive some levels of senior questions for the business. A straightforward pareto
management endorsement. analysis of the spend of the top ten suppliers for each of
your marketing counterpart, followed by an analysis of
In the eyes of many stakeholders, this endorsement bestows how those spends have changed over time or fluctuate
on the marketing procurement team some inherent credibility through the year are always worth considering.
that can be immediately leveraged.
One ‘watch out’ is that the team has to be ready to The greater the detail that can be gained in the initial
deliver on these commitments. spend extract and the further in history it can go back
Rarely does an organisation give the procurement team a the more insight it will give you. Coupled with expertise
second opportunity to get involved in a relationship and about the marketplace – procurement can provide real
so if the team does not have the skills or bandwidth innovations and solutions to the business.
to deliver on the senior management mandate
then expectations should be managed when the The most useful addition to the data is category
mandate is set. information. It is unusual for finance systems to capture
this information and extra fields must be added so
that spend with a supplier can be split down further,
such as creative fees, production costs, rights fees,
media costs etc.

Adam Durston-Hillyer,
Head of Category Procurement,
Specsavers, Active contributor
to Project Spring

Project Spring 24
Hiring for success in
marketing procurement

The secrets to success for marketing procurement teams With this in mind, my recent hiring decisions have really
have evolved over time, just as the marketing function itself revolved around finding people with strong category
has. Traditional media have given rise to a massive array of knowledge, procurement skills and transformational
marketing categories and channels, fragmenting audiences, leadership. I have found great talent inside our existing
and requiring the marketing procurement team to expand procurement organization and have also brought in leaders
their capabilities accordingly. At the same time, marketing without traditional procurement backgrounds, including
teams often face budget belt tightening. those from sales teams, market research companies and
consultancies. I have found this type of team has instant
The good news is that now more than ever, marketing
credibility with stakeholders because they understand
procurement can act as a trusted advisor to both CMOs and
relevant business challenges and brings sound advice, which
CFOs by driving value beyond price—and take center stage
ultimately earns the trust of the business to co-lead change.
in conversations around demand management, process
improvement and specification.
So, when hiring senior leaders in your categories, I
To do this, the marketing procurement teams need to have encourage you to ask yourself whether your candidate:
new capabilities in their toolbox beyond negotiation, contract
1. Knows the category as well as or better than your
management and savings capture. The stars of tomorrow
stakeholder?
are teams that not only have strong procurement skills, but
deep category knowledge and a track record of leading 2. Has a strong vision of where the business can grow and
transformational change. what role procurement can play in achieving that vision?

Needless to say, marketing procurement teams will always 3. Has a style that achieves mutual benefit for both
need to be strong in negotiating, building strong agency stakeholders and agencies?
partnerships and driving value to their stakeholders. The
4. Can bring instant credibility to your organization?
difference is that now, the team must also customize these
activities to match the nuances of the marketing categories If you can say yes to all four, then you have the ingredients
to which they are applied. Having detailed knowledge in for a team that will be cherished by the business.
categories including media, content generation, instore, One that challenges old notions of what marketing
insights and technology will allow marketing procurement procurement is all about and drives
teams to understand the demands and challenges facing value well beyond savings.
their business. This, in turn, enables them to help their
business drive the most effective behaviours and increase
performance of both marketing and agency teams. Christopher Kredo,
But procurement skills and category knowledge are not VP Commercial – Global
enough to make for a successful marketing procurement Demand, Mars Inc.
team. Today, many businesses feel a need to make bold
decisions and transform how marketing and agencies work.
But leaders are not always certain about what or how to make
changes they feel are needed. This is also where marketing
procurement can be a trusted advisor, by tapping external
industry knowledge through formal or informal connections
and mapping current ways of working—both internally and
with our agencies. This allows teams to analyse “make”
versus “buy” for new capabilities and brings confidence that
the necessary new agency ecosystems can be successfully
sourced and embedded into businesses.

Project Spring 25
Broaden addressable spend
A common limitation to the impact that marketing Strive to be involved early in the commercial process
procurement can make on an organisation surrounds the
In Fig. 9 it was clear that early involvement in the commercial
proportion of spend that is considered addressable. Fig. 33
process was strongly linked to whether marketing procurement
clearly shows that higher levels of addressable spend are a
was seen as adding broader value to the business. What
strong indicator of a marketing procurement team that adds
could not be inferred from the data was whether the positive
broader value.
perception was due to the early involvement or whether the
And whilst the need to spend with third parties may not early involvement was critical to improving credibility.
be something that can be avoided, the amount that is
Upon further questioning of marketing procurement
spent on these goods or services should be influenced by
professionals, it was emphatic that value could be delivered
marketing procurement.
to the business at all stages of the commercial process
To be able to credibly add value across the fast-moving world and to early involvement was key to demonstrate this
of marketing tools, the marketing procurement team must wider value.
be commercially flexible and be able to adapt their core
As an enabler to early involvement in the commercial process,
skills to a new and varied set of categories.
official senior management mandate is critical. The data
Background research prior to engaging with a provider shows that of the organisations who have this mandate a
is essential to understand the category dynamics, the large proportion leverage the mandate to gain early access to
costs structure, and the business’ requirements. the commercial process.

From this information and insight, marketing procurement

professionals can engage with the marketplace in a more
proactive manner that will build credibility in the eyes of
marketing counterparts.
The workshop discussions
Reduction in the threshold for involvement
were very clear that effective
of marketing procurement
marketing procurement functions
It is quite clear that there is a huge amount of variability in should have:
what threshold is being used and the reasons for this (Fig.
37). There may be a large number of other factors at play A. Stakeholder training programmes to explain the
that influence this, such as corporate culture, commercial wider benefits of strategic procurement;
maturity of the marketing team, the level of self-service
tools as well as the perception of the procurement team B. Ensure your metrics look beyond price and be clear on
services. However, the lower the threshold for involvement wider, often less-tangible benefits;
of marketing procurement, the more frequent will be the
interaction between stakeholder and procurement teams. C. Better data is needed to get more clarity on wider
This can lead to a closer and more collaborative working opportunities;
relationship where each party will be more appreciative of the
value that the other brings to the relationship. D. Increase your addressable spend – seek to expand
There is a related ‘watch out’ to that identified in implementing your influence;
an official mandate to use marketing procurement. If the
threshold to involve marketing procurement is set low E. Get involved earlier in the process;
and there is insufficient bandwidth to meet the increase in
demand, then there will be an immediate drop in credibility F. Touch everything from low value to high.
that will be very difficult to regain once lost.

Project Spring 26
The importance of
being credible

This report has highlighted the importance of having a 5. Focus on answering and taking part of business
company mandate in place to evolve the perception of challenges rather than procurement objectives; and
marketing procurement. At L’Oréal we have a soft mandate
6. Create a procurement metric that supports an overall
in marketing sourcing – which I would like to call the ‘pull
business challenge, shows, and communicate
method’.
your value beyond savings.
I had conversations with peers in other organisations who
relied on stronger mandates and what I would call a ‘push
method’, to analyse the various types of company mandates.
L’Oréal Sourcing contributes to the CSR and Diversity L’Oréal
My analysis of the pros and cons of these two approaches,
program called Sharing Beauty with All. Our dedicated
reveals the value of each.
program called Solidarity Sourcing Program aims to include
The main challenge for the pull method where you have to underprivileged people through L’Oréal Business relationships
‘build desire’ is to constantly show the procurement value in with partners. We promote access to employment and
order to be invited to take part into business initiatives. social inclusion to women, people with disability, socio-
economically disadvantaged communities….
At L’Oréal, stakeholder engagement based on recognised
expertise is what helps us get involved at an early stage and As there is no value recognition without a metric, we defined
before final negotiations. We advise on appropriate operating very simple metric, measurable and auditable. This metric is #
models, possible supplier landscape and bring insights from Beneficiaries: number of underprivileged people accessing
external benchmarks. sustainable decent work through L’Oréal orders with suppliers
involved in social inclusion projects.
The main challenge for the push method, where there is a
strong company mandate in place to ‘impose the love’ of With Photon, our website factory partner, we developed a
our function, is to transform the perception of sourcing from Solidarity Sourcing Program to foster employment in a Social
being mandatory towards being a real partner. We want to Economic zone in India while also empowering women and
deserve our seat at the table. offering equal chances to people from Scheduled Tribes &
Castes.
The choice of approach is strongly linked to the DNA and
culture of the company. Both have the same overall challenge: Results are 194 beneficiaries in 2018 and 200 in 2019. This
the need to build credibility around marketing procurement Marketing Sourcing partnership was quoted in the Financial
by demonstrating our added value. L’Oréal Report.

Being active in our company’s programs such as Sharing

Beauty With All gives Marketing
My tips to our community for developing the Sourcing more credibility, visibility
marketing procurement credibility would be: and highlights the value of our
1. Ensure your team has the right level of marketing actions.
expertise to engage with marketing counterparts;

2. Identify the key stakeholders who are important for you Myriam Benichou,
and who your team should spend (more) time with. A
Global Marketing Sourcing
successful stakeholder engagement contributes highly
Director, L’Oréal
to differentiating strategic from operational sourcing;

3. Understand what is of value to stakeholders and the

business, to identify mutual benefits;

4. Build desire and share examples of recent success with

other business initiatives, in a language that marketers
understand e.g. efficiencies such as time saved or
higher performance; ideally, these examples would be
shared by our marketing counterparts to their peers.

Project Spring 27
People

Reporting lines Towards greater Finance-Procurement

relationship – highlights from WFA
We saw in Fig. 27 that those marketing procurement teams
workshop in Lisbon – April 2019:
who report into finance are less likely to be seen as adding
broad value to the business.

This may be due to the potential that the marketing A. Finance has to first recognise the added value of
procurement team be focused on cost-related procurement and that ‘broader benefits’ exist beyond
contributions rather than value adding. savings. Procurement could start by gauging if finance
is ready to take on KPIs from other functions, such as
However, the data collected in the survey contained sales targets;
contradictions that were worthy of further investigation. For
B. Procurement should involve finance earlier in the process
example, those respondents that did not report into finance felt
as a member of a project team and discuss short v long-
that, on average, the finance community were more important
term business goals;
than other areas in influencing whether marketing procurement
delivered broader value for the business. C. Procurement and finance teams should align on language
and marketing taxonomy;

D. Promote the tripartite; ensure finance and

marketing regularly engage together, and avoid a

“
‘finance-procurement’ only relationship;
We all know that there are a lot
E. Finance and Procurement must agree on their approach
of soft savings and/or value that to budget holder responsibility;
exist, the main challenge for us is
how to tangibly assess these and F. Align processes to evaluate what to do with the savings

”
achieved (do they go towards profits or do they get
sell them to our Finance team.
reinvested in marketing);

G. Facilitate greater understanding of procurement within

WFA Sourcing Forum member,
finance – including education on different marketing
Luxembourg, November 2017 categories – but also education within procurement
about the needs of finance; and

H. Secure a finance sponsor or business partner.

Contemporary management philosophy would suggest

that the importance of reporting lines is becoming blurred
as organisations adopt a more flexible matrix management
approach.

This shift rewards, above all, a collaborative style of working

where influencing is key rather than direct authority.

Evolving traditional category structures towards cross-

functional teams per project or campaign could help
address the challenge of reporting lines, by including
marketing, finance and marketing procurement teams, as well
as, where possible, agencies, to ensure the successful delivery
of the overall business objectives.

Project Spring 28
Training

Finally, Fig. 38 was clear that those businesses that From mandated to recommended:
engaged in training of marketing counterparts are more 5 tips to evolving your relationships
likely to be seen as adding more value to the organisation with your marketing counterparts
over basic cost saving. The style and subject matter that – highlights from WFA workshop
goes to make up that training is critical in creating a broader in Singapore - November 2019
understanding of the role that marketing procurement plays.

1. Speak a common language. Procurement must

have enough understanding of the marketing
categories to have a productive peer-to-peer
conversation with their marketing counterparts

“ Every year, we run a stakeholder

satisfaction survey to measure our value
and agency partners;

”
delivery perception amongst our business. 2. Be action-orientated and write synergy
targets together. Procurement and marketing
WFA Sourcing Forum member,
must have common targets – move from savings
Dusseldorf, February 2018 to efficiency/business impact;

3. Always show as a united front. Procurement

and marketing represent the client as whole;

“ We cannot expect this perceptual change to

happen organically. Marketing counterparts
will need some degree of education as
4. Human relationships are everything. Go
beyond the traditional stakeholder-procurement
to the new procurement approach by relationship. Ensure that you have a weekly
communicating the value of the changes. fixed time to spend with your key marketing
As part of this, it is crucial to catalogue and counterparts but also regular agency meetings
share the procurement success stories. where both procurement and the business attend;
Ideally, you would get local CMOs to share

”
on how the process had help them. 5. Eagerness to teach, eagerness to learn.
And it goes both ways. Procurement can
WFA Sourcing Forum member,
educate their marketing counterparts about
NYC, March 2018
procurement, but marketers can also spend time
and educate procurement. Leverage each other
teams’ expertise & network.

“ The marketing-procurement
relationship is all about how we can
help each other, how do we protect

”
and grow the business together?

WFA Sourcing Forum member,

Singapore, November 2019

Project Spring 29
Going beyond traditional
reporting lines: the creation
of cross-functional teams
I find it quite interesting that in the reports I read or forums I key at the outset to ensure we all understood the category,
attend there continues to be an emphasis on reporting lines the spend and the role it played in the growth of the brands
and the challenges these create for marketing procurement and what we wanted to achieve, all before we decided that we
team. were going to market on a review.

Whilst not doubting the real challenges faced by colleagues Again, before we launched the external review, we spent
in the industry, I think the key to overcoming these is for significant time discussing the decision-making process
marketing procurement to ensure that we are fully aligned and the flow of information. It was critical to empower all
to the business objectives rather than any specific particular members of the council to be able to talk to all elements of
functional measures. the review and all be clear on the measures of success that
we were striving for. Some of these measures without doubt
At Diageo, marketing procurement reports into the Chief
leant more towards some individual team members than
Procurement Officer who reports into a President of Supply, as
others but the effort put in up front around these objectives is
well as being accountable to marketing and finance. In short
paying back. For example, we have been able to make strides
it is possible to succeed in complex matrix organisations with
in marketing effectiveness through the process.
complicated reporting lines by elevating the perspective you
bring to be one in service of the business as a whole. Yes, we had disagreements, but not once did we have to ask
“who the stakeholder was” or “what the business wanted”
Procurement teams need to stop using words like
as we were all equal members of the council and we all
‘stakeholder’ when referring to internal colleagues
represented the business. We knew this way of working was
and instead talk in joint performance language around
successful when during preparations for a Diageo Global
shared goals.
Board Meeting an exec member said “I am not even going to
One way to do this is by creating real cross-functional teams worry about who delivers which part of the asks, as you are
(or communities, councils or squads!) around business clearly all connected around the same delivery.”
imperatives, which at a simple level turn the “stakeholder”
Did it work? Well we showed internally that we can work
simply into a team member – not a procurement initiative but
quickly and effectively as a cross-functional team, even with
one we which we embrace with abandonment.
the added complexity of C19 when we all view the challenges
Any individual may also be on a number of cross-functional at a total business level.
teams and play different roles in each, leading in some,
Time will tell, of course, as to whether the outcomes are
delivering a specific role in others.
achieved, but we are at the start line feeling confident about
Whilst I personally still enjoy the benefits of working in face- our future media journey.
to-face teams, geography also becomes less important
providing everyone is clear on the goal.
James Taylor,
Diageo successfully operated in this manner during our recent
media review with people from multiple functions, with varied Global Procurement Director,
geographical responsibilities, from different locations and Media, Digital and Consumer
Planning, Diageo
seniority all congregating around a business objective to
make the shift from being a media client to media leader.

There was great importance placed on setting up the ways

of working internally around a media council. The media
council was made up of global and local marketing directors,
digital and data experts, media and brand leads as well as
procurement, finance, corporate relations and legal. It was

Project Spring 30
Performance
When it comes to measuring the impact of marketing
procurement there are as many different metrics as there are

“
marketing procurement professionals. And whilst there may
not be a simple single group of metrics that will unlock a shift Best in class’ may not exist
in perception in the value that marketing procurement bring, – as most marketing procurement

”
there are some obvious trends that can be exploited. organisations grapple with this.

Firstly, there remains a significant reliance on cost WFA Sourcing Forum member,
reduction and cost avoidance as core metrics. Singapore, November 2017

The vast proportion of survey respondents use more subjective

metrics on an occasional basis.

Fig. 39 - What metrics are routinely used to illustrate

that value of marketing procurement – all respondents
“ We want to reduce unnecessary alignment
and re-alignment process of metrics and
free up time for marketing procurement
professionals to focus on brand building

”
What metrics are used - all respondents and driving effectiveness/efficiency.

WFA Sourcing Forum member,

Singapore, November 2017
Cost Reduction 2 57

Cost Avoidance 3 25 31

Stakeholder
Satisfaction
14 24 22 “ Procurement performance metrics
should focus on both: ‘how’ and
‘what’ procurement does for the
business, as opposed to mainly

”
Higher Efficiency 6 40 14
‘what’ (savings) in most cases.

WFA Sourcing Forum member,

SRM improvement 15 29 16 Never Used NYC, December 2018
Sometime Used
Risk Management 13 33 14
Always Used

“
Higher Quality 12 38 10
Procurement is never going to own
the overall company ROI calculations.
Innovation 13 43 4
It’s about how we can enable greater
ROI and open doors for our business

”
Greater Insight 27 24 9 to reach the next level

0% 50% 100%
WFA Sourcing Forum member,
Lisbon, April 2018

Project Spring 31
Filtering these responses for the respondents who feel that Fig. 42 - Alternate soft metrics to measure marketing
their businesses see marketing procurement as adding
Ideal or Innovative KPIs mentioned by participants
broader value than simple cost saving shows some subtle but
meaningful shifts in response (see Fig. 40). There is a greater
likelihood in these businesses to use ‘higher efficiency’, Mentioned Cost-related metric: P&L savings, hard cost reduction,
‘higher quality’ and ‘access to innovation’ as a metric over 30 times cost avoidance, price reduction, increased cashflow
of value that marketing procurement can bring to the
organisation.
Growth/ROI: procurement efforts having an impact
on return of marketing investment, business delivery
(brand/revenues), increased sales, overall improvement
Fig. 40 - What metrics are routinely used to illustrate of commercial targets (EBIT, growth…), brand equity,
that value of marketing procurement – respondents NPS, sales uplift
whose business see marketing as adding broader value
Relationships: recognising that marketing is a
What metrics are used - businesses who see marketing
complex category filled with legacy vendors and
procurement delivering wider value
strong personalities, agency or supplier performance
Mentioned
evaluations, supplier performance improvement due
Cost Reduction 39 over 20 times
to SRM, external perception of fairness, transparency
Cost Avoidance 1 12 26
and professionalism, strong client/agency satisfaction
Stakeholder Satisfaction 6 17 17
results
Higher Efficiency 1 27 12

SRM improvement 8 17 15 Never Used

Sometime Used
Risk Management 9 19 12
Always Used
Efficiency: increased business efficiency, smooth
Higher Quality 3 28 9 operational running of agency partnerships, process
Innovation 7 29 4 improvement, process simplification, doing more with
Greater Insight 15 18 7 less, efficiencies brought thanks to selected agency
0% 20% 40% 60% 80% 100% resourcing, time to market, speed of decision making

This shift from hard or cost-related metrics to adopting

softer metrics is a key step in illustrating the wider value Innovation: access to innovation, applied innovations
that marketing procurement can bring. brought to marketing by the supplier base, implemented
innovation in marketing through suppliers
And it was illustrated in Fig. 21 that it is hugely beneficial
to share targets with the marketing team.
Fig. 41 shows that embracing 360-degree appraisals will Quality: quality of service end-to-end, quality output of
also improve the perception of marketing procurement. Mentioned suppliers, improved or higher quality, best value in market
over 10 times v peers, ability to get the best quality at the right price
(not cheapest)

Fig. 41 - Performing 360-degree appraisals and whether

Internal stakeholder satisfaction: improved
marketing procurement is seen as adding value
stakeholder experience from the marketing service,
internal stakeholder management
The value of marketing procurement is seen as broader when
360 degree appraisals are performed

Evolved cost-related metric: enhanced scope with

same cost, establishing the right supplier mix/both
No Appraisals 43% 57% financially and creatively, contribution to topline with
best cost structure, demand management
Disagree

Agree
360 Appraisals 23% 77% Mentioned Support brought to marketing based on
omly a few
supplier strategy
times
0% 25% 50% 75% 100%
Change management: what can we do now that we
couldn’t before? Why

Agency input to internal client capability initiatives

Project Spring 32
The importance to work “If you cannot measure it,
towards shared goals you cannot improve it.”
Marketing procurement is a specialized capability that is first This is a mantra I have continuously strived to elevate during
and foremost rooted in shared objectives with our internal the last decade leading indirect procurement organisations.
business partners.
I would encourage indirect procurement leaders to establish
We must clearly define what is needed to advance business and distinguish primary from secondary metrics.
deliverables – largely capability, cost, and speed - paired with
The primary metrics are the ones that are externally critical
the agility to flex each of those levers appropriately depending
for all companies across industries to report such as their
on the circumstances.
financial performance (e.g. savings), cash (e.g. payable
Where businesses share common agendas, we can leverage vs. receivable) and top line (e.g. sales growth, distribution
our ability to see across to develop common platforms or expansion, increased reach). Every contribution that the
scaled solutions that meet the greater indirect procurement organisation makes to any of those
good, while not diluting the benefits three vectors of value strengthens the credibility of the
at a brand or category level. discipline as a key member of the team building the overall
business.

The secondary metrics are the ones that are important

Jennifer Mclachlan,
internally to govern the indirect budget/savings, which are
Director, Brand Building otherwise volatile and discretionary. They fuel the primary or
Purchases, P&G
external metrics and the absence of secondary metrics can
turn those budget savings into ‘funny money’.

Secondary metrics are limitless and best defined in partnership

with the key cross-functional partners from marketing and
include performance metrics for the services being bought
(GRP, TRP, CPM, CPV, production costs, creative costs,
agency fees, spend under management, agency relationship
health… etc).

If there is one quote, I would like every indirect procurement

The language of growth leader to live by is: “if you cannot measure it, you cannot
London – June 2019. In a workshop improve it.” I would also add: “if you cannot jointly measure
led by WFA, and to bridge the CMO/CPO it together with marketing, you cannot partner efficiently
language barriers, it was recommended
to improve it”. Make sure the measurements are adding
that cross functional teams start speaking
the universal “language of sales”. A value, aligned with budget owners, and helping cement
common KPI could then be a measure on the value and credibility procurement brings to your
the “cost per sale” – “how much will it business partners from other functions
cost me to generate a dollar of sales” – and across the entire company.
and the procurement’s performance
would be assessed based on the
optimisation of this cost.
Magid Souhami,
Former Global Sourcing
Director, General Mills

Project Spring 33
Highlights from several
WFA workshops:
• The role of marketing procurement can expand over time and so • Business benefits can be split down to top / middle / bottom of the
should the usage of performance metrics. Metrics being used are P&L to reflect that procurement can influence sales performance,
an indicator of marketing procurement maturity; and it is often business effectiveness as well as the cost base.
that you become what you measure.
• Metrics that aim to demonstrate the performance of marketing
• Procurement should not use these measures to justify its procurement should be owned by procurement, with additional
existence. As with other business partners, they should not feel accountability from budget holder or functional partner.
the need to split down business benefits to purely prove that
• The virtuous circle of focussing on effectiveness to drive efficiency:
procurement did something of value.
when you improve quality (effectiveness), you reduce defects and
• Sharing targets that are linked to wider business goals increases rework, and you end up improving efficiency. Time reduction, cost
the understanding of the value that procurement can add. savings… (efficiencies) will become a symptom of effectiveness.

• Procurement deals with different stakeholders who in turn • Metrics can be category specific.
define value in different ways. Some have found it helpful to
• Metrics are not just numbers. Being the ‘customer of choice’ may
differentiate business KPIs from procurement metrics and
be hard to quantify, but we can have a look at the ‘signs of being a
bridge the gap between these two categories of metrics. Using
customer of choice’.
primary or external metrics vocabulary and references when
having discussions with marketers will help them understand the
procurement value.

Seven examples of metrics beyond pure price reduction

Contribution to top line growth and top line sales: 1 Process simplification leading to operational
efficiencies: to show the marketing procurement
4
to demonstrate the shared accountability with the
business in taking the right decisions that will bring role in challenging the business to reduce
a better ROI and better sales, for example: complexity and overcome silos.
1. Choices that procurement can help make on a creative that
will be more effective;

2. Sourcing-led strategies to optimise and connect existing

5
processes to an e-commerce landscape; and

3. Identifying capabilities that are needed by our Risk management: to capture the impact of avoided
business and sourcing effective agencies that will risks; the Covid-19 pandemic can present an opportunity
act as extended arms of internal marketing to quantify the value of some of the risks that were
resources, leading to a better business ROI. avoided, or that will have to be avoided.

Demand management: to recognise marketing

2 Successful agency relationships at an enterprise 6
procurement’s ability to coach the business to not level: to illustrate the unique procurement role in
spend in certain areas (e.g. avoided projects that were not bringing two organisations (client & agency)
considered as priority or effective, avoided duplication…). together and towards better relationships overall,
when marketers are engaging with agencies at a
brand or market level.

Change management of the business 3

environment for the better: to show the level
of partnership and connectivity of marketing
A broader metric to drive meaningful changes 7
within our industry: e.g. a metric assessing the
procurement with their organisation, as true compliance to human rights within the whole
business partners and solution providers e.g: supply chain, supplier diversity spending (e.g. African
1. Implementing a (new) DAM system; American, LGBTQ+, or women-owned business spending),
a metric assessing how procurement helps cascade
2. Defining a remuneration or compensation
company environmental commitments to suppliers,
model that will improve agency relationships; and
the procurement contribution to the reduction of
3. Sourcing data management tools for better unemployment (e.g. thanks to what procurement
performance analytics, and better buys and allows to bring people back to work).
return on data investments.

Project Spring 34
Marketing procurement
metrics & brand business
KPIs: bridging the gap
Marketing procurement has rapidly evolved and by now When asking him specifically where marketing procurement
most organisations are enabled to measure and track the could play a big role, the answer was clear: “my wish for the
defined metrics such as cost savings, contracted savings, procurement function is to help me on my objectives, a better
cost avoidance, managed spend, Purchase Order accuracy return on marketing investment. Marketing procurement is
and procurement ROI. Setting these metrics is part of seen as part of my team and that’s why I invite you to our
the procurement basics and should be well defined in all marketing team meetings.”
procurement organisations. But isn’t it a bit reductive of what
we do? How can we demonstrate our performance to our The key to the success is to find the narrative in our objectives,
business partners? starting with looking at “marketing budget as an investment”
rather than as a cost. It is important for procurement to better
What is the objective of marketing procurement that can be understand what the direction of the company is and the role
measured with metrics or KPIs? While KPIs might be similar of the business partners.
or even the same from one company to another, the real and
All of us working in marketing procurement have an obligation
ultimate set of metrics or KPIs every manager is faced with
to enhance our objectives and metrics and link them with the
is based on what their boss asks them to do on a regular
overall company objectives and KPIs.
basis, and how these are weighted in their total deliverables.
Therefore, the reporting line can matter as metrics of a CMO, An interesting area for marketing procurement to explore in the
CPO and CFO may slightly differ. But the vision and mission light of sustainability are media investments and related CO2
of the company remains the same for everyone. emissions. Media investments usually represent over 50% of
the marketing budget. Therefore, in most organisations, very
As a leader in marketing procurement, the opportunity lies detailed KPI frameworks have been developed that include
now in linking the marketing and company objectives to brand and business KPIs as well as buying commitments.
create a balanced behaviour, where savings are truly just one More advanced frameworks include the increase of quality of
of the metrics we are measured on. This is key, as only a set of media placements which is being recognised in the savings
our initiatives is driving direct savings and are not necessarily calculation. As the media industry represents a €500 billion
addressing the objective of your marketing counterparts. business, there is an opportunity to bring the sustainability
topic for these services to the next level.
CPO and CFO must realise the opportunity we have in Digital advertising has by now become the biggest investment,
marketing procurement to help drive other marketing bypassing TV, and growing. This means high energy consuming
and business KPIs. What are the steps to go about this? data centers. More than half of the world’s population is now
online and contributing to more CO2 emissions then the
1. Review the objectives and KPIs as well as their aviation industry, producing 4 % of total CO2 emissions.
importance to each function in the company; Marketing procurement can help to determine the metrics,
start reporting our digital advertising CO2 emissions and
2. Ensure that marketing procurement objectives link to the make it part of our sustainability framework.
marketing and company direction and KPIs; For marketing products such as print, and packaging marketing
procurement can apply practices around certified paper
3. Build marketing procurement metrics that feed into (FSC) and eliminate PVC usage. Another sustainability aspect
marketing and company KPIs; is travel; how can we help to optimise our ad productions
and reduce travel cost? The COVID crisis has already taught
4. Utilise a governance body with marketing to prioritise us that we can get agencies to pitch online and to optimise
production shoots. Let us in marketing procurement find
your initiatives that will drive the desired metrics.
metrics to capture the reduction in CO2 emission and connect
it to the sustainability framework.
Brand KPIs would consist of several metrics such as brand
desire and penetration. In a recent interview with a senior
marketer of my organisation, he made it clear that that is not
Michael Pues-Tillkamp,
where it should stop.
Head of Marketing Procurement,
IKEA Retail (Ingka Group)

Project Spring 35
Partners

Our initial survey back in 2018 mainly focussed on ‘Process’, ‘People’ Relying on external partners to
and ‘Performance’ themes. ‘Partners’ is another dimension that has evolve internal perceptions
been added later on, after multiple discussions with WFA members
across the world who felt that their perception was not only linked to The success of marketing procurement is often measured by
their internal organisation and processes, but also heavily influenced savings delivered or the perception of the CPO and/or the
by the way they work with external partners. CMO of what great work looks like. There is often a traditional
and outdated view of the procurement industry, one that
Agencies acting as extended arms of internal marketing resources
needs to change. Organisations need to realise that the
can have an important impact on the performance of a company’s
success of marketing procurement should also be measured
business KPIs.
by the performance of the marketing agencies working on
Marketing procurement as growth enablers of their business, their account.
should play an active role in ensuring the success of the work
performed by agencies working on their account too. All too often, the perception is that ‘procurement will take care
of the commercials’ and ‘marketing takes care of creating and
Marketing procurement as connectors that are fully integrated to the
delivering content’. And that ‘together you have an end-to-
core company business, can facilitate top-level discussions between
end logic and magical approach to managing marketing’. This
their organisation and external partners, and bring a global company
is a trap many organisations fall into.
view while marketers engage with agencies on a more brand specific
or market level. Who is creating the environment for agency creativity to
A well-managed agency is an obvious competitive advantage for flourish? Who is responsible for creating an environment
clients, and for the above reasons, can be seen as the mirror of a where marketing and agencies are set up to do their greatest
successful marketing procurement function. work? To unleash their creativity on your brands. I believe the
answer to all these questions is marketing procurement. From
Effective Supplier Relationship Management (SRM) programs will
internal budget management to agency briefing processes,
be a way to unlock value and improve the credibility of marketing
from creation of winning KPIs to 360-degree evaluation of
procurement.
these KPIs, marketing procurement is key.
The Sourcing Board has already started to evolve global agency
management and created their proposed We should always be taking the learnings and making the

‘principled sourcing for global relationship stronger, ensuring the remuneration model is set

agency relationships’. up to drive winning outcomes, paying agencies more linked

to great performance, driving consistency across global and
markets, enabling agency partners to work together as one
team and recognising great agency performance, particularly
WFA’s Global Sourcing
the people who work day in and day out on the account.
Board will aspire to:
1. Behave as strategic brand business partners; The reality is that selecting agencies and agreeing commercials
is only the tip of the creativity iceberg, true value is created
2. Focus on both top and bottom lines and recognise
that value is greater than just cost; through the culture and environment you build. Unleashing
the potential of your agencies should be priority because if the
3. Identify gaps and invest in learning and development;
focus is not on supporting your agency partners to deliver great
4. Adapt our processes to use right and fair selection criteria; creative then what you pay, what you negotiate is irrelevant
5. Choose agency collaboration over creating artificial and all the value generated is lost.
market-place tension;

6. Champion diverse, responsible, and Barry Byrne,

sustainable relationships; Senior Global
7. Strive for commercial terms that enable a viable Procurement Director,
ecosystem for all parties involved, including agencies; Sales & Marketing, adidas

8. Be authentic and honest with our external partners;

9. Be transparent with confidentiality respect and

treat our partners fairly; and

10. Focus on issue resolution before pitching as a solution.

Project Spring 36
Supporting your
stakeholders in managing
their agencies better
& demonstrate your
value add
In my opinion, SRM programs are designed to improve relationships HEINEKEN has recently redesigned its global understanding of what
to ultimately increase our company’s competitive advantage. It may a vital relationship with the agency is, what it means for all parties,
be a familiar topic for the procurement community but not many what implications it brings and what demand it creates. Depending
organisations can say they have a robust SRM program for managing on the complexity of the agency base, SRM programs could be
agency relationships that is well understood, encouraged and used applied to all agencies or just to more strategic ones. However,
by equally procurement, marketing stakeholders and agencies practically speaking, as first step, we advise our local markets to put
themselves. critical agencies under SRM: meaning the ones that really impact
the business, bring an on-going value, have long-term (2-3 years) or
SRM should be seen as an opportunity for marketing
mid-term (1 year) commitments, with critical budget thresholds and
procurement professionals to re-create the image of our
are generally “future proof”.
function. When designed with end customer in mind i.e. agency
talent and key decision maker on the marketing side, it will play a key When it is an ad-hoc agency, we feel that there are less benefits
role in it bringing us closer to our stakeholders. through SRM, unless the agency has a great potential to influence
the business and there is an intention to grow the relationship. The
My recommendation, before entering the SRM space, is that
link between an efficient agency base, SPM and spend productivity
organisations must look at the ‘big picture’, set up an ambition
is where the finance team can play an important role as well, without
for the category and regularly track the direction. SRM in order to
diverting the discussion to ‘savings’ and ‘bottom line effect’.
not become a paper exercise within procurement, must speak the
business language and unlock business value for marketing as a At HEINEKEN, our global procurement team has set up a framework
result. offering some degree of flexibility for local teams to slightly change
their approach; for example, they can add specific, local, and critical
SRM programs can apply to any type of supplier/partner and
metrics for the evaluation. It is very key to follow one process across
should at least include the following dimensions: segmentation,
our organisation, one direction, speak one language, while also
development, performance management (SPM), interaction
understanding critical deviations and local differences.
and risk management. They are designed to:
In SPM, most companies are advised to carry out a 360-evaluation
1. Build a stronger agency base for the company in an ever- based on the qualitative criteria such as: strategy and campaign
changing marketing landscape; architecture, production & creative execution, account management,
innovation, digital & technology, etc. Fact-based areas have to also
2. Speed to market – give clients access to the best agencies be evaluated; it could help to have discussions focused on tangible
and talent for the right job; and quantitative criteria, for example sales, brand equity measures,
market share.

3. Scale opportunities e.g. improve agency output, attract By applying a ‘no surprises’ and full-alignment principles in SPM,
agency talent to the account; we feel that agencies continue to be motivated and encouraged to
allocate the best talent to our account. Continuous SRM enables to
4. Mark, record and follow up on mutual improvement between make the right decision based on facts and to work on improving the
agency and client; relationship with and status of current agencies before considering
a pitch process, which can be costly, time consuming and inefficient
5. Encourage both parties to invest more into the relationship, for all parties.
monitoring its financial health and sustainability; The current pandemic situation has accelerated the need for
SRM with agencies, especially for those companies that do not
6. Boost synergies, share knowledge and explore readiness to have a robust framework for it globally. Building relationships
innovate together; during unprecedented times tests the framework, network, builds the
core of the relationship and creates greater speed in
7. Identify dependencies and work on them; joint decision making.

8. Unlock and allocate mutual resources; and Ekaterina Agafonova,

Global Strategic
9. Enable key decisions in marketing and data strategy. Sourcing Director Commerce, Heineken

Project Spring 37
Conclusion
Procurement does not always get the credit it deserves. That’s
reflected in the publicity that bad marketing procurement
practices, real or imagined, attract in the press.
10 traits of a successful marketing
The solution is to show the entire organisation the value that procurement team – from the
procurement can add. Done well, procurement can have the Global Sourcing Board:
second largest impact to the bottom line aside from sales.
There are typically two ways for a company to grow: by 1. Procurement and marketing have shared
increasing turnover (greater sales) or increasing profit margin business metrics for success;
(reduce waste, simplify/standardise specifications, optimise
marketing strategies, operational models and efficiencies 2. Marketers are keen to receive advice and naturally
across the value chain, encourage reuse, all of which fall call their procurement counterparts;
into the role of procurement). Savings should be a positive
symptom of value-based procurement strategies, driving 3. Agency senior leads engage with procurement to
efficiencies, reducing wastage... but not the end goal itself. discuss top level client-agency priorities;

The role of marketing procurement has been a hot topic.

4. Beyond the traditional stakeholder status:
A growing number of sourcing experts see their future
procurement and marketing feel that they are
in adding value beyond savings. Not just as a business
part of the same team;
partner with shared objectives, but as a source for
growth within their organisations. In this context, a shift
5. Procurement leaders have regular conversations
from a savings outlook to a value creation approach is
with marketing & finance on how to jointly drive
vital.
value for the business;
There are at least 4 key themes to be addressed that will move
the perception of marketing procurement forward: process, 6. Reporting of results is part of the over-arching
people, performance, and partners. All work should be towards business performance management and the internal
shared goals. Marketing, finance, and procurement peers and external reporting process;
work for the same company and are supposed to be playing
on the same squad, with the same ambition: the growth of 7. Procurement is seen as delivering business solutions
their organisation. Agencies should help contribute to that and innovation by challenging and/or changing the
common goal and share success with marketing, finance and business environment for the better;
procurement teams.

Project Spring aims to raise awareness around marketing 8. Marketing and procurement provide honest
procurement performance and value – but it is down to WFA feedback to each other, on how they can improve
members to see if they want to take it further, driving business their ways of working;
growth.
9. Marketing and procurement jointly invest in training
This report aims to inspire and create debate internally as well towards working together more effectively; and
as externally with partners and peers. We hope it will encourage
you to find some answers to help evolve the perception of 10. Marketers and agency partners see a role in the
your function in your respective organisations. It is a journey procurement function as a valuable step in their
with multiple steps and a lot remains to be done. From being career.
brilliant at basics, stepping up to world-class and then looking
to the future. Not everyone is at the same stage of the journey.
But there are many common challenges and we all share in an
exciting journey of transformation.

Project Spring 38
Appendix:
WFA’s Global Sourcing Board
Goal is to revolutionise the practice and
perception of marketing procurement. OUR VISION
Be the trusted partner of brand investment
WFA created a Global Sourcing Board in May 2019 to accelerate
strategy, from sourcing to resourcing marketing
change in marketing procurement by improving practices and drive the business forward
across the industry. The board aims to help accelerate change,
formalise what good marketing procurement looks like, collate
standards, and help other procurement leaders progress from OUR MISSION
cost to value. To define world class marketing procurement
and set the standards that members of
Collectively, the Global Sourcing Board represents companies our community should uphold
spending in excess of $50 billion on communications each
year, giving them huge power to drive wider change across the
profession. Related news
A key element of the Board’s work is to champion WFA’s Getting peak performance from evaluation
Project Spring. WFA’s global sourcing community sees the
Value at the time of the virus
new board as an opportunity to evolve the current perception
of marketing sourcing and its value contribution and is ready Redefining the marketing procurement
to embrace the opportunity to improve the industry as a whole value proposition
without impacting on the competitive commercial positions
The WFA Global Sourcing Board, 6 months on
of individual member companies.

Founding members of the WFA Sourcing Board:

Barry Byrne Myriam Bénichou

Senior Global Procurement Director, Global Marketing Sourcing
Sales & Marketing, adidas Director, L’Oréal

James Taylor Christopher Kredo

Global Procurement Director, Media, Digital and VP Commercial – Global
Consumer Planning, Diageo Demand, Mars Inc

Magid Souhami Tracy Allery

former Global Sourcing Director, General Mills Associate Director, Global Procurement, Agencies &
Marketing Excellence, Mondelēz International

Jose Gonzalo Bisquerra Mora Alex Morse

VP Marketing & Sales, Global Procurement, former Procurement
GSK Manager – Media, Nestlé

Ekaterina Agafonova Jennifer Mclachlan

Global Strategic Sourcing Director Commerce, Director, Brand Building
Heineken Purchases, P&G

Michael Pues-Tillkamp Tuomas Anttila

Head of Marketing Procurement, IKEA Retail Director, Global Marketing Procurement,
(Ingka Group) Unilever

Project Spring 39
About the World
Federation of Advertisers
The World Federation of Advertisers (WFA) is the voice of Related insights
marketers worldwide, representing 90% of global marketing
Interested in content strategy development? You can find all
communications spend – roughly US$900 billion per annum
the benchmarks, meeting overviews and insights on this topic
– through a unique, global network of the world’s biggest
on our Global Knowledge Base, for example:
markets and biggest marketers. WFA champions responsible
and effective marketing communications worldwide. Click here for our WFA survey on Client-agency
performance evaluations: the agency view (2020).
More information at www.wfanet.org
Click here for our WFA webinar on search of the unicorn
For questions on the WFA Sourcing Forum or this report,
marketer (2020).
please contact Laura Forcetti
Click here for our WFA guide on a marketer’s approach to
at [email protected]
diversity and inclusion (2020).

Click here for our WFA survey on global marketing

Acknowledgements
operations (2020).
This report has only been made possible thanks to the
Click here for our WFA survey on effective agency
passionate input of highly experienced and forward-thinking
management (2019).
marketing procurement leaders. WFA owes thanks to
Ekaterina Agafonova, Jennifer Mclachlan, James Taylor, Jose Click here for our WFA survey on global agency relations
Gonzalo Bisquerra Mora, Magid Souhami, Michael Pues- management: roles & responsibilities (2019).
Tillkamp, Christopher Kredo, Tuomas Anttila, Barry Byrne, Note: You will need to be logged in to download any files from
Adam Durston-Hillyer, and Alastair Ray. Special thanks to Tracy our Global Knowledge Base. WFA members can click here to
Allery and Myriam Bénichou for reviewing the entire report get their login details resent to them. Members who are new
and suggesting valuable edits; as well as to David Wheldon to WFA can request their login here
who supported our transformation initiative since the very
beginning. True change comes when inspiring colleagues, like
you, lead from the front. Note: All WFA benchmarks, survey results, agendas
and minutes are reviewed by Hogan Lovells
International LLP, our competition lawyers. WFA
Competition law compliance policy:
Additional Information

WFA is happy to pass on members’ experiences and/or

The purpose of the WFA is to represent the interests of advertisers and to act as
recommendations. Please note that any such experiences
a forum for legitimate contacts between members of the advertising industry.
and/or recommendations do not reflect WFA’s position
It is obviously the policy of the WFA that it will not be used by any company
and should not be considered as WFA’s experiences and/or to further any anti-competitive or collusive conduct, or to engage in other
recommendations. WFA does not undertake any investigations activities that could violate any antitrust or competition law, regulation, rule
or make any judgments on the quality or the performance or directives of any country or otherwise impair full and fair competition. The

of any agency and does not take any responsibility for the WFA carries out regular checks to make sure that this policy is being strictly
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accuracy of experiences and/or recommendations expressed
that their membership of the WFA is subject to the competition law rules and
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the WFA, directly or indirectly, (a) to reach or attempt to reach agreements or
understandings with one or more of their competitors, (b) to obtain or attempt
to obtain, or exchange or attempt to exchange, confidential or proprietary
information regarding any other company other than in the context of a bona
fide business or (c) to further any anti-competitive or collusive conduct, or to
engage in other activities that could violate any antitrust or competition law,
regulation, rule or directives of any country or otherwise impair full and fair
competition.

Project Spring 40
WFA members

World Federation of Advertisers

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wfanet.org
[email protected]
+32 2 502 57 40

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41
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