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While CMO tenure seems to have stabilized, their average time in the role is still only about 4.2 years, according to Spencer Stuart’s annual CMO Tenure Study.

Wikipedia defines the chief marketing officer (CMO) as ‘a corporate executive responsible for marketing activities in an organization. Most often the position reports to the Chief Executive Officer.’  So I took a look at some random job descriptions for CMO positions and here’s a snapshot of what’s expected of the role: So, as we appear to be measuring average CMO tenure over the course of a few short years, you have to ask – how the heck can anyone make a meaningful impact on those mandates in that kind of timeframe? And with that kind of pressure, it should come as no surprise to agencies operating with CMOs in these environments, that expectations to perform are really high. So what should CMOs be expecting from their agencies in this kind of pressure cooker environment?  Here are five that could make a difference:

Focus on the business

OK, no brainer. But it’s very easy to develop a myopic focus on a project at hand rather than the broader aspects of the business.  So the question agencies should being asking, is what’s really going to make a difference here?  What metrics is the CMO really looking at?  And is the agency 100% focused on delivering against those metrics?

Understand what the CMO really has to deal with

If you’re in any doubt as to what a marketer has to deal with – take a look at the laundry list of responsibilities a CMO is charged with.  Dealing with an agency – or agency issues – is just one piece of the puzzle in delivering a whole range of results expected by the CEO. Typically CMOs are looking for agencies to take things off their plates – not add to them – so agencies that are natural problem solvers and collaborators likely to rise to the top.

Be thought leaders in change

Where’s the marketer’s business going?  Where’s the agency business going?  And how can those evolutions maintain a parallel path to ensure success? Day-to-day demands often have agencies focused on delivery, but CMO’s are looking for clear, concise, well-reasoned thought leadership that helps them evolve their vision within their own businesses.

Manage complexity

Multiple brands, a myriad of distribution and communication channels, multiple projects often managed by multiple agencies, shifting business priorities and rapidly evolving consumer habits mean CMO’s often have to switch focus and priorities on a dime, while ensuring their organizations grow profitably.  Agencies must adapt to these scenarios, while providing leadership, insight and perspective that support CMO environments.

Deliver!

Above all, agencies need to deliver flawlessly – both in strategy and production so their CMOs can focus on driving their businesses and stay ahead of the competition. Issues around strategic thinking, delivery, cost or timing only take away from the CMO’s real role and their perspective on how you’re adding value to their business. If this has you or your agency thinking you need to step up your game – you probably do.  Make no mistake – it’s really tough out there. How can agencies support client CMOs and make themselves more valuable to your business?
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Whether you’re a client looking for marketing services, or an agency pitching your wares, the question of who’s really calling the shots can be a pivotal one.

On the one hand, the organizational perspective might be that marketing teams are evaluated on and are seeking things like improved performance, chemistry harmony between teams and agencies, creative brilliance and / or strategic smarts. On the other, client procurement teams are likely going to be evaluated on things like cost based efficiencies, savings, synergies and risk mitigation.

And with those perspectives, it’s hardly any wonder marketing and procurement teams can find themselves at odds with each other, leaving potential agency partners a little bewildered as to who’s really calling the shots.

We’re increasingly asked to work with procurement when undertaking an agency search – either to work on the search itself, or to work with them through the negotiation or contract development process.  And while relationships between marketing and procurement vary between organizations, there are some consistent themes that are worth addressing.

In our experience, the primary issue many organizations still have difficulty coming to terms with is that marketing needs to be viewed as an investment – not a cost. In other words, it’s not something that needs to be “minimized” – it’s an investment that needs to be “maximized”.

So how should each side approach agency selection or contract negotiation in order to meet the goals of minimizing risk and costs, while ensuring maximum performance through best in class capabilities?

Here are ten approaches worth considering when marketing and procurement teams need to work seamlessly to achieve the best value (rather than just best price) for their organizations:

Same Team

First of all, marketing and procurement aren’t on different “sides” – there shouldn’t be sides at all. Both sets of players are on the same team – so eradicate the idea of “sides” from the get-go.

Start Early

Many will have read about the idea of starting the procurement exercise early – but how many actually define a working relationship between marketing and procurement before it becomes necessary? And how many actually involve procurement in the entire search process when they know procurement will take the lead on the negotiation?

Define Roles

Because marketing and procurement look at search and selection, and negotiation through different lenses – define and agree specific tasks for each group, leveraging respective strengths and skill-sets.

Get The Brief On Paper

Brief as you would an agency. Procurement work on multiple contracts for different stakeholders – just as agencies work on multiple clients. So define your objectives, propose your strategy, define go and no-go items, propose negotiation points and spell out your desired end state in a written brief.

Acknowledge Why You’re Here

If your agency search or contract negotiation is anything other than a corporate governance requirement, clearly define why you’re negotiating now. In all likelihood, lowest price isn’t the only or primary reason you’re here – so spell out why you’ve called an agency search or want your MSA or contract renegotiated.

Define Value

Lowest price rarely equates to greatest value, so define and agree what constitutes “value” to create an MSA or contract that delivers greatest value for the organization.

Don’t Chuck It Over The Fence

We’ve seen many agency search processes conclude with a winning agency, and the marketing team then hand-off the process to procurement to negotiate and finalize a contract. Procurement then have little or no context to negotiate “value” and marketing teams are quickly frustrated that the process takes longer than they’d like and / or key details aren’t covered.

Define Key Points

Every aspect of an MSA or contract is negotiable, so defining where you’re flexible and where you’re not up-front will help your organization create a true, value based MSA or contract.

Look At The Sum of The Parts

(Not just some of the parts.) As I’ve said before, every aspect of an MSA or contract is negotiable. Greatest value from a contract will be derived from looking at the agreement holistically, rather than piecemeal.

Be Like a Pilot

Because planes have dual controls, pilots identify who has control so they’re not pulling in opposite directions before they take-off.  Ultimately someone has to lead the negotiation process and whoever’s responsible can save everyone involved time, effort and uncertainty by defining parameters and expectations in the key objectives and outcomes of the negotiation.

One of the biggest mistakes made by marketing and procurement teams is leveraging the marketer’s brand to lower prices to unsustainable levels. Low rates that are too good to be true usually are, and the agency will ultimately have to cut corners to keep and maintain your business in the long-term.

Proactive planning between marketing and procurement teams to define expectations, objectives, true value metrics and negotiation points upfront adds value and will almost certainly help you avoid undertaking a new negotiation – or even agency search – sooner than you’d like.