Driving ROI: Q&A with Sourcing Leader Tracy Avelar

March 7, 2019

By Bill Duggan

ANA

Tracy Avelar is managing director of vendor and sourcing management at Charles Schwab & Company, and will be hosting the ANA Advertising Financial Management Conference in late April. The ANA's group EVP Bill Duggan recently interviewed Avelar on all things sourcing and procurement.

 

Q. Your career includes sourcing positions at Target, Williams-Sonoma, Gap, BlackRock, Visa, and now Charles Schwab. Thinking back to 10 years ago, what are the key changes in the industry overall for marketing sourcing?

Moreso than ever, marketing sourcing professionals are required to understand very granular details about the industry and where it's going. It's not good enough anymore to just sit with your sourcing team, benchmarking pricing, and then negotiate a standard services contract.

We need to truly collaborate with our marketing and agency partners to understand what their objectives are, then motivate the agency to prioritize our business versus another company's so the agency can better drive our business forward.

Incentives to reward agencies for mutually agreed-upon outcomes are important. We need to stay up-to-date on new marketing technology and data companies, as we are required to understand the end-to-end risks associated with the services, including what information we share and what downstream implications there are with third and even fourth parties, i.e., subcontractors to our subcontractors. We also need to understand the connections between these third and fourth parties and our agencies, and whether there are any conflicts.

 

Q. Sourcing professionals need to drive improvement on both marketing ROI and cost-effectiveness. How do you prioritize and balance the two?

Priorities between these change from project to project. What's critical is that you understand your business partner's goals, and help develop strategies to accomplish them.

 

Q. Tells us about some of your current initiatives and priorities at Schwab.

My key priorities and initiatives for this year are centered on providing value for both my business partners and my team. Value can certainly be cost savings and ROI improvement, but more often it's increased strategic support from sourcing to obtain enhanced data that helps our business partners make better decisions. It can also be time saved through express contracting processes, which helps both our partners and my team.

 

Q. How have you worked with your external agencies so that they view sourcing as a partner rather than a threat?

In my experience, you need to get to know them as people, not just the "agency contact" on the other side of the negotiation table. I find more and more that they do understand our role and have been able to develop relationships through open and honest dialog about each other's goals.

It's also critical to ask for feedback and listen to how we as a client can evolve and what we need to start, stop, or continue doing. Often, I find the teams get too focused on the work product, but don't talk enough about how both sides work. Driving efficiencies in the "how" can make the agency's life better, marketing's life better, and often leads to money that can be reinvested in the relationship.

 

Q. What advice do you have for someone just starting out in marketing sourcing?

I encourage them to not just focus on the next contract negotiation. Sure, you need to be thoughtful and strategic in your negotiation, and be up on the latest trends for your remit.

But in my experience, to be successful in marketing sourcing, you also need to prioritize developing relationships with your business partners — this includes marketing, finance, legal and compliance teams. What are their objectives? What are their challenges? What do they see as the next change on the horizon in the industry? Then work to determine how you can support them and overcome the obstacles they face.

 

Thanks to MediaPost for originally publishing this blog.


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