This post is by David Angell, TrinityP3 General Manager and Head of Media. David has extensive commercial and media experience gained through a fifteen year career in media agencies, which he uses to help drive optimal results for TrinityP3 clients.
The marketing team responsible for a $50m marketing budget approached TrinityP3 wishing to consolidate its agency roster via a pitch process.
The team had experienced servicing challenges with its current roster of agencies. Furthermore, a new focus on cost and efficiency following a merger had generated downward pressure and a perceived need to demonstrate significant efficiency gains.
The client operated in a complicated sector, and was required to navigate numerous stakeholders to achieve change of any kind.
Although accepting a round of agency pitches would have been straightforward, before leaping to solution mode we prefer to fully understand the situation of the marketer.
With this in mind, TrinityP3 spent several hours with the marketer, pre-project, to determine causal factors before agreeing to embark on a potentially lengthy pitch process.
We uncovered the following challenges:
- An extremely large and unwieldy agency roster
- Following the merger, a lack of defined due diligence process
- Lack of clarity around contractual and remuneration conditions across the roster
In this instance, TrinityP3 believed that to run a series of pitches across such a large roster would not represent optimal efficiency, or effectiveness of outcome.
Instead, we recommended a Roster Alignment process:
- Gain full understanding of pressure points including duplication, gaps and misalignment in the current roster
- Assess and benchmark remuneration positions and uncover anomalies, and potential efficiency gains
- Identifying long term and legacy agency partners with complex relationships into the new marketing and corporate structure
- Consider and develop alternative roster structures to meet the immediate and future marketing and business needs for discussion.
The process was completed in a number of stages:
- In depth stakeholder interviews with all appropriate individuals to determine needs and requirements and current level and satisfaction with supplier and agency performance.
- Data gathering and assessment across a roster of over 60 agencies to develop a robust financial model of spend / investment across the roster.
- Financial benchmarking of remuneration structures, and creation of a customised benchmarking framework to allow for consistency across the board.
- Creation of operational frameworks – different options for different scenarios.
The project was completed across an eight week period.
Result and feedback:
The Roster Alignment process uncovered a number of critical learnings:
- A potential cost saving of over $2m – which could be generated via a combination of rationalisation and negotiation with existing agencies, if required.
- Three alternative roster models that, given our learnings, could drive better effectiveness and efficiency.
- A framework of internal challenges to be addressed, before external steps should be taken.
Using TrinityP3’s findings, the client was able to internally demonstrate not just cost savings, but an internal road map to deliver the required change before attempting to rebuild the external roster.
Whilst the realisation that millions of dollars could be achieved in savings was extremely useful, the client also recognised that, because of our approach, a premature step to wholesale pitching had been avoided, which in itself realised significant cost savings, as well as increasing the chance of building an optimal structure for the future.
TrinityP3’s Media Transparency, Performance and Value Assessment takes a holistic look at the operation of your media agency, assessing against best practice at every stage of the journey. It aims to give you the tools to improve the output of your media agency.
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