As we began outlining in the previous installment of this Spend Matters Plus series, better RFX management and, in particular, better modeling and cost analysis are just the beginning of the value good procurement platforms and processes can bring to marketing. The next level of value is in what procurement, and marketing, can do with the data collected not only from the RFX but also from deliverables and metrics throughout the creation and implementation of the campaign the agencies are engaged to support. With the unprecedented spend detail that a good procurement platform can capture, a good analytics and business intelligence platform will provide marketing with visibility into actual costs and comparisons with benchmarks, analytics by spend type, project type and agency, and cross-correlation with sales for insight into value-generating spend. Letting the light shine in through marketing-specific spend analytics capability represents a huge opportunity. But this is nearly uncharted territory for far too many organizations. The first place to start is investing in the time and effort to capture sufficient detail in all transactions so that you can create meaningful reports and trends. Join us as we conclude this series, outlining how to tap into the intelligence, visibility and value-add training that could ultimately help procurement get marketing spend under management this year.
AnyData Solutions: Exploring the Customer Experience of a Spend Analytics Provider That Should Be on Your Shortlist
AnyData Solutions is yet another procurement — and in this case broader analytics — upstart provider that has underinvested in sales and marketing to date, opting to put all of its efforts into its product. While you might not know AnyData yet, we believe you soon will — either as it ramps up its public face or, likely, becomes part of a larger firm, which has happened to virtually all of the long-standing spend analytics providers to date. As we conclude our analysis of AnyData Solutions in this initial Spend Matters PRO series (see Part 1 here), we will continue to delve into a rather complex customer deployment and offer summary analysis and recommendations.
Everybody wants a good spend analytics solution. Rightly so: without it, all sourcing activities — and many other cost reduction activities — will be based solely on gut feel. That’s not scalable, nor particularly efficient. And thanks to a number of acquisitions in recent years, there’s a dearth of independent and creative spend analytics solutions in the marketplace today. Many providers directly (and indirectly) in this market have been snapped up by larger firms and rolled into sourcing and source to pay offerings. Consider the following somewhat recent acquisitions: Spend Radar (by SciQuest), Spikes Cavell (by Xchanging), BIQ (by Opera) and CVM (by Kroll). There simply aren’t that many independent providers left, and other analytics acquisitions by firms, such as Huron and Wipro, are driving further consolidation in the market. But a few remain. AnyData Solutions is one among them, a curious, young and independent spend analytics firm that Spend Matters has looked at and conducted reference calls on. This two-part Spend Matters PRO review provides an introduction to the provider and a deep dive into a client experience where AnyData was used for spend analysis — and more.
RFXs are expensive to run on either side of the fence, for marketing and for agencies. Granted, the bulk of this expense comes in the form of soft costs. But the undertaking is considerable and carefully vetted among agencies. Spend Matters has learned that some agencies estimate their total cost, when all hard costs and revenue losses – from assigning talent to proposals instead of projects – are factored in, to be around $200,000 per RFP, on average. This point is important to emphasize: agencies are quite picky about the clients and projects they bid on. So if the RFP does not grab their attention quickly, it will be dismissed, and so will your organization. Thus, if you can convey to marketing that your vast experience with services RFPs can help marketing get a better response rate, and better responses, it is more likely to be receptive to your words. So how do you go deep on RFX support messaging? In this installment of our Spend Matters Plus series, we outline seven focus areas that will help procurement practitioners guide marketing through the RFX processes.
Novatus is one of our 50 Providers to Watch. We will be highlighting 100 companies (50 to Know, 50 to Watch) from our 2015 Spend Matters Almanac over the span of 100 days. Practitioners are encouraged to browse the categories listed in our Almanac to find the provider that best fits their needs.
Solutions that manage your contracts — on the sell-side (CRM-driven) as well as the buy-side (procurement) — is what Novatus focuses on.
Marketing is all about generating demand for the organization’s products. Thus, value to marketing is any activity that has the potential to increase demand. The primary activity marketing undertakes to increase demand is advertising. This activity is primarily accomplished through contracting agencies with the creative talent (the “magicians”) that marketing believes has what it takes to produce the magic that will increase demand with the fresh and innovative campaigns and messages these creative types will generate. Thus, a big part of marketing is agency management. Often the greatest value that procurement can bring marketing, at least in marketing’s view, is any process, methodology, technology or resource pool to help marketing better manage its agency relationships. If marketing already thinks those relationships are good, procurement can still help foster more successful agency relationships. How will procurement accomplish this? In this installment of our six-part Spend Matters Plus series, we take procurement practitioners through how to clarify and pitch the value message of certain management processes for marketing, ultimately helping marketing close the loop between what was created and what was delivered.
How best to connect with the marketing team? As a procurement professional, you probably hear this over and over again from bloggers, analysts, consultants and even vendors who stress that a new initiative will not be successful without executive support, and engaging with marketing is no different. Even if you talk the talk and walk the walk (as we analyzed in the first part of this series), and come bearing great suggestions to address marketing’s value drivers and increase the overall return from the marketing spend (our point in Part 2) — even if you can use this newfound knowledge to get marketing to lower the drawbridge and invite you into the foyer, it doesn’t mean the wizards of wondrous words are going to take you seriously or invite you back to dine in the great hall. One has to remember that marketing has a right to be cautious, and maybe even distrustful, of your new value-generation messaging because the last time procurement came knocking, it was to cut costs, which is not necessarily beneficial to marketing. Thus, it’s only reasonable that they would want some c-suite assurance that this time it’s different. So how do you get the right executive support? That’s what we’ll tackle in our third installment of this Spend Matters Plus series.
In the first installment of this Plus series, we discussed how, despite the fact that we have known for almost a decade that the marketing category contains significant value that can be unlocked with good procurement practices and processes, in most organizations, marketing is still a “sacred-cow” category that is out of procurement’s reach. In these organizations, marketing still insists that it cannot be constrained by procurement logic in its quest for the best agency magic and that it’s not how much you spend but how much business value you generate. And while this is mostly true, it’s not entirely true. It’s about spending wisely so that every additional dollar of spend generates additional, measurable value for the brand. Marketing’s entire purpose — increasing sales and brand value — cannot be done without spending hard dollars, and, generally, success will correlate with how much is spent. As a result, the goal is to always increase, not decrease, the available marketing budget. This is one category where it’s not about savings but about value delivered. As a result, the money needs to be spent on agencies that produce campaigns that generate results, and on third parties that provide the products and services that support the campaigns (print, digital media, etc.). However, one cannot even begin to contemplate who the right parties are until one understands the value drivers that need to be considered and addressed. So how to make logic + magic = profits? First, in this installment, we will discuss the four biggest value drivers to marketing — understanding those will be key to gaining their trust and getting their spend under management.
In part one of this Spend Matters PRO research brief, we took a look at Oversight System’s tools and spoke with the provider’s CEO to deepen our analysis of this niche provider. As we mentioned in the previous installment, if you can feed your T&E spend and p-card feeds into a generic, but strong, spend analysis tool, you can get some level of insight on non-compliance in this challenging spend area. But if you don’t have such a tool or you really want to go deep, you should check out Oversight. In part two of this PRO research brief, we share our Q&A with Oversight CEO Patrick Taylor to deepen our analysis of this niche provider. For Spend Matters PRO subscribers, read on! If you are procurement practitioner who is a Plus subscriber and want access, please contact us and we’ll send you a copy.
Much like packaging, logistics and maintenance, repair and operations (MRO), the marketing spend category straddles the boundary between direct and indirect. And we all know that it has a substantial impact on sales and revenue — allegedly, at least. The reality is that, while every marketing dollar spent can have a huge impact if spent appropriately, the direct commercial impact is notoriously difficult to assess, and the value per dollar spent even more difficult to quantity. However, organizations can no longer afford to ignore this “sacred spend cow” category, as every dollar spent needs to count in an inflationary market. Marketing needs procurement to squeeze every penny of value out of agency spend to not just lower total costs but also maximize revenue uplift and brand enhancement. However, this won’t happen as long as a moat separates procurement from marketing. Thus, in this series, we have distilled the approaches and practices we’ve seen adopted by leading practitioners and present a step-by-step plan to help procurement gain marketing’s ear, trust and support in helping marketing manage its spend for maximum performance. In this first installment, we break down why you need to walk the walk, talk the talk, get educated and “live the marketing life” — all of which should help loosen marketing’s drawbridge and ease it down across that moat.
In a recent Spend Matters post, we discussed the challenge of T&E spend compliance and getting good analytics in this area. If you can feed your T&E spend and p-card feeds into a generic, but strong, spend analysis tool, you can get some level of insight on non-compliance here. But if you don’t have such a tool or you really want to go deep, you should check out Oversight Systems. The company just published the second edition of its T&E spend analysis report. It has many interesting findings, but what's really interesting, however, isn’t the summarized statistics but some of the details around the non-compliant spending behaviors caught by Oversight’s tools. In part one of this PRO research brief, we take a look at Oversight’s tools and speak with the company's CEO to deepen our analysis of this niche provider. For Spend Matters PRO subscribers, read on! If you are procurement practitioner who is a Plus subscriber and want access, please contact us and we’ll send you a copy.
A few days ago I spoke with Charles Dominick, president and CPO of Next Level Purchasing Association (NLPA) on the topic of supplier diversity. NLPA has just made available a new course module focused on strategic supplier diversity. As a driver behind the new course, Charles brought up some industry perspectives and mentioned how, in his experience, even established programs in companies considered leaders in supplier diversity practices have been merely tactical in their approach to the area.