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planning for the year ahead
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Happy New Year and welcome to the first edition of the P3 e-news
for 2004. Hopefully your plans and budget for the coming year are
in place. But what does the year ahead have in store?
In this edition
of P3 e-news we look into the economic crystal ball and look at
the options available to maximise advertising value on the roller
coaster ride ahead.
P3 – helping people
achieve commercial purpose through creative process
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maximising returns in 2004
Views on the economic
outlook for 2004 / 05 are as diverse as the number of economic commentators.
Up, down, stay they same or keep on changing, here are some tips from
a marketing and advertising view point on ways to manage
your advertising budget to achieve maximum value.
If the market goes
up…
While a buoyant
market expands sales opportunities, the associated advertising
costs can increase as well, with greater demand on media availability
and production resources increasing rates.
Managing rate increases requires:
1. Ensuring a detailed and accurate reporting process
to monitor real costs against outcomes.
2. Creating or accessing cost benchmarks to measure the
increased cost against the potential revenue gain.
3. Ensuring longer term planning to provide marketers and agencies with
opportunities for negotiating more competitive rates.
4. Locking key suppliers into price agreements to avoid inflationary
pressures.
If the market stays flat…
Depending on budget allocations, most advertisers are under
constant downward pressure. Especially at a time when business
perceives marginal growth opportunities. Rather than being pressured,
this is an ideal time to take a proactive position on advertising
costs and:
1. Review your advertising processes (especially briefing and approvals)
to ensure the most cost effective system is in place.
2. Identify opportunities within existing advertising collateral to leverage
greater longevity (eg. refresh rather than renew an existing
campaign)
3. Calculate the costs associated with all elements of your advertising
program and prioritise each, taking into account the hidden
costs associated with cutting the activity.
4. Use the opportunity to review longer-term agreements, developing more
efficient and cost effective remuneration models.
If the market fluctuates…
To take advantage of a fluctuating market requires the ability
to react tactically and strategically. The rapid
pace required to move with the market requires well-structured processes
and cost control systems to ensure cost effectiveness is maintained.
To ensure the marketing team and agency can focus on the task you should:
1. Develop both a long-term strategy and short-term tactical plans
up front.
2. Develop agreed and fixed cost remuneration to make
cost control and reporting more efficient.
3. Negotiate supplier agreements based on minimum volume
/ activity.
4. Ensure detailed briefing and approval processes
to minimise delays and mistakes.
P3 provides
advertisers with a range of independent and qualified services to achieve
greater value and cost effectiveness across all aspects of media and advertising
production. We have extensive experience in remuneration negotiations,
cost and process benchmarking and training. In reviewing your year ahead,
call us to discuss how P3 can help you maximise your budget in 2004.
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