You are here

RESEARCH NEWS: Procurement saves money but hinders marketing campaigns

Procurement departments are increasingly involved in buying marketing services to cut costs but they are potentially damaging campaign success according to a survey by marketing services specialists, The Observatory.

The survey revealed 73 per cent of senior marketing decision makers see procurement getting involved in buying marketing, advertising and PR services and 65 per cent of respondents cite ensuring better value for money as the reason behind their involvement.

Although procurement teams may be securing short term savings, The Observatory revealed marketers do not feel the benefit extends to the improved success of their campaigns. Seventy-one per cent of respondents felt procurement’s added involvement wasn’t improving the effectiveness of their campaigns, while only eight per cent felt they were having a negative effect.

Lucinda Peniston-Baines, co-founder of The Observatory International said, “The problem is, these responses suggest procurement is ‘buying blind’. Almost anyone can negotiate price cuts. But there’s a danger of procurement ‘knowing the price of everything but the value of nothing’.”

The small survey of 50 people also revealed over a third of CEOs get involved in the agency selection process. However, the perceived benefit varied with 56 per cent saying it had a positive effect and 44 per cent claiming a negative.