The Procurement Opportunity: Media
By Bill Duggan
ANA recently released the report, "Procurement 2022: The Good, the Bad, and the Ugly." The work measures the perception of marketing procurement among three constituents: procurement, marketing, and agencies.
One of the key questions asked, "How would you rate marketing procurement's performance in the following disciplines?" Media was one of the disciplines rated by both procurement and marketing (not agencies).
Seventy-five percent of procurement respondents rated marketing procurement's performance in media as very successful or successful. Among the various disciplines rated (13 total – others included production, PR, and marketing research) media was rated highest by a wide margin by the procurement respondents.
There were extensive qualitative conversations to supplement the quantitative and we drilled down about the work in media that procurement is doing.
In those discussions it was noted that marketing procurement can be active in:
- Contracting
- Media agency selection (if in a review)
- Media agency compensation
- Media agency scope of work
- Media billings/payments
- Helping to set KPIs
- Media agency performance evaluations
- Media auditing: This includes confirming what has been bought (versus plan) and ensuring the quality is reflective of the brand's needs.
- Advertising fraud monitoring
- Cost/rate benchmarking
- Providing insight on cost improvement opportunities and inflation mitigation.
- Liaison with key external digital partners. It was specifically mentioned that many marketers are doing direct deals with companies such as Google and Meta; that's important, per learning from qualitative discussions: (a) so that marketers "own our data rather than rent it"; (b) to minimize (and ideally eliminate) rebates; and (c) to co-develop programs with external digital partners.
- To coordinate the activity of different internal teams/divisions (if applicable) to optimize efficiencies.
Meanwhile, marketing respondents also rated procurement's performance in media – 26 percent of marketing respondents rated procurement's performance in media as very successful or successful. That compared with 75 percent of procurement respondents so obviously there is quite a gap.
MediaPost commented on this after the procurement report was released, with the perspective that, "ANA Finds Disconnect Over Performance Of Procurement, Especially For Media."
This represents an opportunity for procurement. Media is the biggest marketing spend for many ANA member companies. There is lots that procurement does specific to media, and that contribution can be improved. One specific area where procurement should tread carefully is in media costs. Procurement is still critiqued for focusing too much on driving costs down. In media, CPMs can always be lower. But low CPMs often don't result in the most effective media plan.
Media procurement is a specialty and ANA believes that more companies should have a media procurement professional in-house. People like Lisa Figel of Johnson & Johnson; Katherine Freeley of Novartis; Mark Hudson of Walgreens; Jim Lawenda of Colgate-Palmolive; and Kevin McCollum of Hershey.
Again, media is the biggest marketing spend for many ANA member companies. Media is fragmented and complex with lots of watchouts including ad fraud, brand safety and the opacity of programmatic buying. While ANA has long advocated that more companies need a chief media officer, the additional role of media procurement should be considered as well.
See the full report here.
The views and opinions expressed are solely those of the contributor and do not necessarily reflect the official position of the ANA or imply endorsement from the ANA.