Stefan Bradley, Research, Insight and Operations Director at The Art of New Business writes up the procurement roundtable with Sarah Billson, Tickling the Trout.
If you ask the average agency MD to give their thoughts on procurement you’d almost certainly be met with a mixture of fear and loathing accompanied by copious expletives.
Widely misunderstood as a ‘function’, procurement is seen by many as an unwelcome intrusion that exists only to drive costs down. The reality is procurement now plays an increasing role in the agency review process, so it’s in an agency’s interests to understand how best to work together with this group to achieve the common goal of fruitful commercial relationships.
In this, the third event of the Good Pitch Week, Sarah Billson, founder of procurement consultancy Tickling the Trout, and Deputy Commercial Director and Head of Corporate Services Procurement Team at the Foreign Office shared some of the key mistakes agencies make when dealing with procurement and revealed her insights for successful collaboration.
8 Top Tips for Pitch-Perfect Procurement:
1. Procurement are people too!
Nothing irks procurement more than meetings in which agencies lavish attention on the senior marketer in the room whilst they’re treated with disregard. Don’t forget that procurement and marketing are part of the same team and their opinion counts.
2. Don’t sell yourself short.
Procurement are tasked with negotiating to get the best value for money. Have your own negotiation plan ready and be prepared to bargain hard if necessary. If you immediately roll over and agree to drop your prices in an effort to win business you’re devaluing your business and you’ll leave procurement thinking that you were overcharging in the first place.
3. Hold that hashtag…
Don’t tweet or write blog posts immediately after your meetings with procurement. It might be okay for meetings with marketing but it’s not appropriate for commercial negotiations (and it really winds up procurement people).
4. Take an interpreter.
Make sure you have someone in your team who talks the same language as procurement – someone who understands the commercial aspects and can answer their questions. If you don’t know the answer, it’s better to ask to come back to them. Whatever you do, don’t try and blag it, they’ve heard it all before and will see right through you.
5. Get creative.
Be creative in the way you approach the commercial aspects (and we don’t mean be creative with your accounting). We’re talking in terms of commercial models here. Most agencies default to their rate card when a one-off project fee, payment by results or risk and reward approach could make you a more attractive proposition than your competitors.
6. Show your working.
Give procurement confidence in your ability to manage their money by demonstrating that you can look after your own. Share things like expense policies and buying processes to demonstrate you’re running your agency as a business. If you don’t, procurement will come and watch you to satisfy themselves that you are (and woe betide you if they spot something they think they can do better).
7. Don’t gold plate your capabilities.
Offer a level of service that fits the brief and be wary about talking about extra services that you could provide, otherwise you may find yourself under pressure from procurement to provide those services on top at no extra cost.
8. If you don’t ask…
Don’t be afraid to ask about a contribution to pitch costs. Many clients have a budget to cover larger pitches where they’re asking agencies to do a significant amount of work so it’s worth enquiring. However, don’t expect to get your costs back if you’ve gone crazy and spent miles more money than the other agencies in the pitch.
One last (and very salient) point Sarah made is that agencies are hired to do procurement’s job i.e. they’re tasked with spending a budget in the most effective way. Not only do agencies need to persuade clients they’re the best choice creatively and strategically, they also (with procurement’s involvement), need to convince clients that they’re in safe hands commercially.
It’s that two-way street/empathy thing again. To get the best results, strong relationships have to be built right from the start of the process and between every group involved. Remember, procurement are people too, they’ve got a job to do and they’re here to stay, so get building.