.jpg&h=630&w=1200&q=75&v=20170226&c=1&w=1200&resize=1200,630&ssl=1 "Brand marketing procurement teams unhappy with their KPIs: WFA study | News")
Source: WFA’s “Setting and delivering targets in marketing procurement” report, produced in partnership with Flock Associates.
A recent study conducted by the World Federation of Advertisers and Flock Associates has revealed a growing dissatisfaction among marketing procurement teams at major international brands regarding their current key performance indicators (KPIs).
These teams are looking to expand their metrics of success beyond just cost savings, as they believe that focusing solely on savings is not enough to demonstrate their effectiveness in challenging economic conditions.
The study indicates a shift in focus from cost savings to delivering value, aligning with the goals of Project Spring, launched by the World Federation of Advertisers (WFA) five years ago. This project aimed to change the perception and role of procurement by emphasizing contributions beyond financial savings.
The study surveyed 51 senior marketing procurement executives from global corporations with a total annual marketing budget of $114 billion. It explores how metrics impact behavior and outlines the strategies these executives plan to implement in 2024 to bring additional benefits to their organizations.
Key findings:
- 52% of respondents stated that their target setters had ‘good’ or ‘very good knowledge’ of marketing, leading to the delivery of vague or disconnected objectives that hinder effective collaboration between procurement and marketers.
- 85% plan to add more value beyond savings in 2024, with only 2% expecting to contribute less value than savings.
- Media investments were the primary focus for cost savings in 2023 (64%) and will continue to be in 2024 (53%).
- Brands are increasingly focusing on creative (19%) and production (11%) for savings, leveraging technological advancements like GenAI.
- Many targets are based on a percentage of media and marketing spend (38%), with 9% based on previous year’s achievements.
- Expectations for savings in 2024 are higher than in 2023, with half of organizations expected to deliver 7% savings or more.
- Annual marketing budgets are projected to increase in 2024, with 32% of respondents anticipating a rise in spending.
- There is inconsistency in how companies define savings, with some considering savings versus last year’s fees as hard savings, while others view negotiated final offer differences as hard savings.
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