edition 72 may 7, 2007
approval is costing you money

     While advertisers will often look to their agency providers to reduce costs, one of the key areas that drives costs in all aspects of advertising is the approval process, or more importantly, the lack of an efficient approval process. In this edition of P3 e-news we discuss the cost of the approval process and suggest ways advertisers can realise big savings without impacting on the quality of the outcome, or even realise an improvement in the outcome. In this P3 e-news: – a better approval system – P3TV workshops just weeks away – benchmarking your process efficiency – where digital sits in the mix – Webinar  
save time and money with a better approval system Sitting with a client and their agency, I was talking about the cost in time, resources and dollars being consumed by their convoluted approval processes. You see, we had identified that for most projects there were eight people involved in approving each stage of the creative and production work. For major processes this number rose to fourteen and dragged down the agency and marketing departments speed to market. We had undertaken a benchmarking exercise and identified that the briefing and approval process was driving a 15% over resourcing in account management. This represented a $120,000 per year impact on the retainer. changes are driven by multiple stakeholders Most organisations have a collaborative culture, which encourages more people to be involved in each process. This, and a flatted organisational structure means that multiple people of similar authority can be involved in the approval of work as part of the advertising output. The problem is that each approval potentially, and usually, involves a change to the current work. This process works also more effectively if all those involved in the process are working to the same brief (but that is another issue altogether). changes to artwork is a revenue bonus for the agency The issue is that every set of changes can be a bonus revenue opportunity for the agency. While some agencies are on a fixed fee for production, most agencies are on head hour rates for production. In the most extreme case we were asked by an advertiser to investigate their agency’s costs because it costed $7,000 to provide the client’s logo for a balloon printing. What we found is that the size of the logo on the artwork was changed more than 12 times by the six stakeholders involved in the approval process. Each set of changes cost $650 in studio time, plus print outs, pdf’s, archiving, etc… a rigorous process is the secret to minimising production costs All advertisers should review their approval processes to: 1. Map the current process to ensure it is as direct and rigorous as possible 2. Identify all stakeholders and the role they play in the process (Use the RACI or similar process) 3. Look at reducing or consolidating the number of stakeholders where possible processes can be reinforced by software and online systems Back to the meeting we had with our client and their agency. Once we had discussed the cost of the approval process we went on to talk to the client about the many online approval systems that help to manage the approval process when you have a large number of stakeholders. The agency added that they currently used one of these approval systems with some of their other clients. You could hear a pin drop as the client wondered why this had not been offered to them, and lead to a 15% reduction to the retainer they were paying the agency. To find out what your current approval process is costing you, contact P3 in Melbourne 03 9682 6800 or Sydney 02 9279 4997 or by email on people@p3.com.au  
P3TV workshops just weeks away – SELLING OUT FAST  

  2007 P3TV Production Workshops for Advertisers are on: Sydney – Mon 7th May, SOLD OUT Sydney – Thurs 10th May, SOLD OUT Melb – Tues 15th May, SELLING FAST   Booking forms via amanda@p3.com.au There are more P3TV Workshops scheduled for October 2007. Stayed tuned for details later in the year.      
are your processes efficient?  

Is your agency or other providers inefficient? Slow? Expensive? Or is it your processes that are impacting on their ability to deliver? And what is the real cost? P3Biz can undertake a performance benchmarking assessment to determine the cost of your current processes and advise on the best way forward. Contact P3Biz by email at people@p3.com.au  
where does digital sit in the marketing mix?  
  Join in the next P3 Webinar on Tuesday May 22 at 1.30 pm, where we will be discussing the impact of the digital platform on traditional advertising practices. For more infomation on this free webinar please see the invitation at Premiere Global Services.  

P3 – helping people achieve commercial purpose through creative process

Share this with a friend or colleague by clicking on the link below or add them to the ëp3 newsí mailing list, by emailing their details to news@p3.com.au

Check out the new P3 blog at https://www.p3.com.au/blog/