Claire Beale: The price of value
No cash prizes for noticing that money is a theme this month. From the new (old) brands of high-street banking to (in)conspicuous consumption, a reassessment of value (as opposed to price) and a hard look at marketing salaries, filthy lucre is our thing.
Claire Beale is editor of Marketing
So there I was, working on a way to string all these money strands together for this column and not getting very far because my deadline had only just passed and the pressure hadn’t quite mounted enough to induce productive panic. Then several things happened at once that put rather a different spin on my topic.
First Premier Foods was lambasted for asking its agency partners to make an upfront payment to secure a place on its roster. Apparently Premier wanted Starcom MediaVest Group to hand over £350,000 a year, just for the right to apply its media expertise to help Premier sell things. Creative agency partners were also asked to make a payment, albeit a more modest one.
Then ad agency body the IPA passed a vote of no confidence in the Government Procurement Service, which compiles the agency rosters to work on public-service communication campaigns. The GPS had run a farcical reverse auction for its strategy and planning roster: an eight-hour race to the bottom that spooked some of the best agencies into offering low prices that were not sustainable without serious compromises.
Meanwhile, another (as yet unnamed) company has been floating the idea among agencies of charging suppliers a fee for the administration of invoices. All this on top of the trend toward adopting 90-day, or even 120-day, payment terms.
I know that many marketers privately empathise with their agency partners over the crippling impact of these financial demands. But price is what you pay and value is what you get, and marketers will face only diminishing returns from their trusted allies if they do not take a firmer stand against some of these tough payment terms. It is their brands, and their personal reputations, that will suffer in the long run. When Oscar Wilde said "Anyone who lives within their means suffers from a lack of imagination", he didn’t take into account the pressures on marketing budgets and the demands for accountable ROI – but he was on to something.
This article was first published on marketingmagazine.co.uk
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