Decideware

Depth interviews conducted recently with fifteen Chief Marketing Officers in the US has revealed some interesting trends in media spend and agency management.

The move to new media

The research, conducted by Andrew Tipping, a partner at Booz, Allen, Hamilton in conjunction with the ANA, found:

• Market leading CMOs have changed their advertising spend patterns ahead of the rest of the market
• Half of the budget of marketing leaders is now spent on the internet and other new media
• The change to a greater share of spend in digital has occurred in the past 2 years

Other characteristics

Further, Tipper found 5 other factors common to the study group, they were:

1. Driving advertising partners (agencies) to become more integrated, ‘go digital’ and collaborate better with clients
2. A customer centric marketing focus
3. Quantifying the return on marketing investment
4. Training staff and integrating them in the main business
5. Remaining adaptable

Tipping also noted when CMO’s focussed on profitable growth, they had more tenure than the average CMO of 24 months.

Our 2 cents ...

Can we add an observation?

The growing shift towards digital, and the emerging trend of digital becoming a larger part of the mainstream creative and media spend, may place some pressure on traditional client-agency relations.

Generally, if clients do want to encourage their agencies to move in a desired direction, e.g. to incorporate integrated digital offerings, then working with them to formulate an appropriate agency evaluation framework can be a very effective method to help manage the change process.

Marketers collaborating with their agency partners to design evaluation metrics which reflect the new shared objectives generates not only good will in the new direction of the partnership, but perhaps more pragmatically, also offers a means for both parties to table and discuss in depth the metrics that will drive the new direction and form the basis of successful future evaluations.

And it may be that where a significant shift in direction is required, marketers and agencies should design a staged evaluation framework.

Staged Approach

A staged approach, whereby for example the metrics shift toward the ultimate objective over an agreed period, delivers both guidance to all the people working on the partnership and time to allow both parties to adapt as necessary.

Many agency evaluations are currently limited to a short time horizon, commonly 12 months.  In the future, we may well see clients and agencies set short term, long term and transitional parameters for their relationships.

Author: Viji Ratnam (Decideware)

See: CMO Thought Leaders; The Rise of the Strategic Marketer.

Source article: The Australian, 18 Oct 2007.