A Roundtable Recap
Stagwell Group and ForwardPMX continued a conversation on this important topic with a second virtual roundtable in early December.
The roundtable, which was hosted by Alexis Williams, EVP of Marketing at The Stagwell Group and Supriya Dev-Purkaystha, Commercial Director at ForwardPMX, was designed to be 100% interactive, and participants were encouraged to share their own perspectives, challenges, and solutions. It was also an opportunity for participants to (virtually) network with like-minded individuals and explore questions they don’t always get to ask their agency partners. Below are key takeaways from the discussion.
Procurement 101 — the Need for Internal Education and Promotion
The group had an important discussion regarding the fact that many internal stakeholders on both the client and agency side lack basic awareness of the procurement function. One participant noted that she spent 12 years in digital marketing before she learned what the procurement team does and how it could benefit her and her projects — and that once she did, she had a “lightbulb moment.” Participants agreed that there is a need for education within businesses so that colleagues understand the purpose and value of their procurement departments — not just in terms of cost savings and efficiency, but in cultivating strong client/agency relationships.
Participants also discussed the extent to which procurement is involved in early planning. In many businesses, procurement is engaged for the RFP process or a pitch, but only once stakeholders have already defined what the business need or opportunity is. The group discussed whether there has been a shift in recent years to procurement taking more of a front seat — or at least having a seat at the table — in terms of identifying what businesses need to compete today and in the future. Participants acknowledged that while procurement has an opportunity to be front and center when a brand is going through a significant organizational change — not just in terms of operations, but as an opportunity to redefine value and performance metrics — for the most part, stakeholders don’t actively seek out procurement’s input in the ideation/creation phase. Instead, it’s the procurement team’s responsibility to be “appropriately invasive,” as one participant put it, by asking questions and seeing where they can contribute.
Planning for Uncertainty
While there is growing hope for a return to normalcy in 2021, there are still many “what ifs.” One profound result of this is businesses’ ability to plan. In many cases, participants saw the planning process fundamentally change in 2020, with much quicker cycles, the need to be much more nimble, and, most importantly, the need to be comfortable with much higher levels of uncertainty than in the past.
How do businesses navigate such unprecedented levels of uncertainty? The group mentioned several solutions, including:
- Putting a premium on relationship management and cultivating / maintain trust in suppliers.
- Building sourcing strategies around percentage of confidence.
- Taking a “balance card” approach to measuring procurement that includes savings, but also more consumer-driven metrics, such as sustainability and the extent to which brands connect with their personal values.
Balancing the Current Push for Digital with the Potential Return of Traditional Marketing Models
The group spent a significant amount of time reflecting on how COVID accelerated the push for brands to embrace a digital-first world. That said, there is an expectation that 2021 will see some level of normalcy return– and with that, some level of traditional sales channels, such as in-source shopping and brick and mortar stores, will return as well. Given that, the group discussed what procurement planning looks like when businesses have to balance the current confines of 2020 with the potential opportunities of 2021.
As part of this discussion, Stagwell EVP Alexis Williams noted that their portfolio companies NRG and Harris Poll have done a lot of analysis in the US on business performance trends related to COVID. They have found that brands tend to fall into one of three categories:
1. Businesses that came to a halt (e.g., airlines, hotels, cruise lines);
2. Businesses that maintained (e.g., banks and other financial institutions); and
3. Business that accelerated (food delivery services and Amazon).
Each of these categories has its distinct set of challenges, from how to capitalize on and sustain momentum gained from COVID to how to reverse reputational damage brought on by the pandemic. For each category, there are big strategic questions and sourcing considerations that will inform and impact their balancing act.
While 2020 has been an incredibly difficult year, it has also forced positive changes, pushing businesses to embrace the need to communicate in a digital-first world and accelerate the move from offline to online. While much remains uncertain, participants were optimistic that the challenges we’ve faced together and the collective lessons learned — particularly the need to embrace uncertainty — will lead to better outcomes for years to come.
The Stagwell Group is a digital-first marketing company serving clients with simplicity and speed at scale. To learn more, head to www.stagwellgroup.com, or visit us on LinkedIn, Twitter, or YouTube.