Category Archives: Marketing

Still Using Product Photography to Drive Sales? Part I

Today’s guest post is from Brian Seipel, a marking project expert at Source One Management Services focused on helping corporations achieve both Marketing and Procurement objectives in their strategic sourcing projects.

While this guest post is a bit off of the beaten path for SI, it’s a very interesting one and relevant for those Procurement professionals that want to run with the marketing bulls.

Still using product photography to drive sales? Why there may be a better way!

Pictures are certainly worth a thousand words when it comes to products sales, and well-shot product photography is a key aspect of many sales and marketing budgets. Many organizations recognize that those “thousand words” are the least of their worries, however – those pictures are worth a large chunk of their budgets as well. In fact, the higher-end or more physically detailed the product is, the more organizations can expect to pay for a proper photograph.

Any organization operating in the luxury space has likely asked the question, “Do we really need to put so much money towards product photography?” Unfortunately, the answer has always been a resounding “yes” from Marketing – until, perhaps, now. As with all areas of business, technological advances are offering a clever disruption to the product photography space.

Digital Rendering: The Product Photography Killer?

Many organizations are either turning to, or considering a test run of, digitally rendered images to replace product photography. In a nutshell for those unfamiliar, a rendered image is one generated entirely from a computer. Without going too deep into how rendering works, here is a brief overview:

  • The Wireframe: To start, we need to build a model of a product. The wireframe defines the shape of an object by taking a 2D or 3D drawing and developing it into a digital model.
  • The Skin: At this point, the model alone has no form. Typically, this empty “space” is represented visually as a simple set of intersecting lines (hence the name “wireframe”). The skin, or texture, applies visual characteristics to the model. Consider a product made with both white gold and brown leather – two materials that are very visually different. The gold would be light, smooth, and highly reflective. The leather would be rough, rich in dark color, and non-reflective. All of the attributes of these materials must be perfectly reconstructed in a digital environment.
  • The lighting: When a product photo is taken, excruciating attention is paid to creating a compelling lighting setup. Lighting is used to evoke specific emotional reactions or showcase key elements of a product. This is just as true for rendering – lighting sources have to be both created (how bright, focused, and warm or cool the light source will be) and directed at the model (determining what direction light should come from, and how many sources are needed to effectively light a product).

Think about any Pixar movie you’ve ever seen – these are beautiful examples not just of rendering, but also a fair representation of just how far advances in rendering have come. As amazing as they seemed to us when they first hit theaters, early digitally rendered movies look crude by today’s standards. The pace of development is moving extremely fast, thanks to refined techniques, better digital tools, and more powerful computer platforms to run them on. In fact, it is becoming extremely difficult, if not impossible, to discern a photograph of a product from its comparable rendering.

But it isn’t enough for a rendering to be “as good” as a photograph. For organizations to ditch photography, rendering needs to offer more. And it will. How? Come back for Part II.

MBAs, Here is Why You Have to Support Procurement!

You have to support Procurement because this is the next big thing78. You might still be engrossed in the ad-driven world created by the marketing mad-men that can drive mega-sales when done right, but face it, there is only so much revenue to be gained from incremental sales with a 3% margin. But Procurement, this is the real low-hanging fruit74. Sales would have to double to add the same amount to the bottom line as Procurement could add if it simply took an extra 3% off of the lifecycle cost for a product with a 3% margin. Given that Sales doesn’t have the bandwidth11 to double sales, and Procurement always has the bandwidth to shave off a few percentage points on the right categories, the choice should be obvious.

Let’s face it, you need a few quick wins75 — and what better place to get those wins then with a new initiative that can deliver real ROI5 with relatively minimal investment. In fact, Procurement is a cash cow25 that is typically undernourished and one, that if it dies of starvation, could take the business with it. Face it, it’s the one part of the business whose primary focus is to not leave money on the table.

Yes, you need to be a team player8 with more than an open door58 policy. You need to tear down the silos internally47 to get things done, but remember, it’s all about synergies26 and you are a self-proclaimed agent of change42. Plus, once costs are under control, data driven2 Procurement will go back and sharpen their pencils, think outside the box10, and when more immediate savings are not immediately identifiable, focus on value-add63 and look for ways to get more for less.

Maybe you have to manage the optics18 of what you do, and maybe you will need to initiate some creative destruction19, but the savings and value generated are scalable61, applied to every unit. Best-of-breed62 organizations are best in class in Procurement. (In fact, every year they will take at least 4% to 6% off of the entire bottom line when properly supported. That’s a huge number!)

In fact, Procurement can bring about a paradigm shift1 in the organization. It might be tough to wrap your head around3, but it’s true. We can ballpark the opportunity6 easily. Going back to our example above and peeling the onion87, if the category sells 10,000 units at 100 each, the organization takes in 1,000,000 in revenue and makes $30,000. If aggressive marketing could increase sales 20%, the profit would be $36,000. But if Procurement, with the same investment, could decrease costs by 3%, the profit would be $60,000. How could you not want to run with this89?

We realize we’re not quite comparing apples to apples86 here, but at the end of the day32, if you step up to the plate27, square the circle24 between organizational units, it will be a win-win4 for everyone and no one will be stuck putting lipstick on a pig34. When you cross the chasm14 and sail into that blue ocean14, the bottom line will go from good to great14 and inflate as you pass the tipping point14 and you will definitely want to run with it89.

And if you don’t think it will move the needle48, we have four words for you: Supply Chain Top 25. Deal with it.21 You don’t need to do a SWOT analysis30 to realize that the answer to the 64,000 question23 that if you want to monetize29, the fastest way to increase profit is decrease costs. It’s a strategy that is more than actionable enough53, one you should incent41, but the net of it is13 you will come out ahead. When the rubber meets the road12, results oriented36 Procurement wins. So, going forward57 be a visionary7 and support Procurement. My 2 cents is54 that if you give Procurement the support they need, you can phone it in88 and still win big.

A big shout-out to Eric Jackson of Ader Investment Management who took the time to compile the brief dictionary of the MBA language for the rest of us who like to stay in the trenches90.

Also, if you select text the last two posts, you will see that we used every key phrase of the MBA language, so this should help you, as a practitioner, get their attention.

MBAs, Sourcing Innovation Feels Your Pain!

MBAs, let’s address the elephant in the room77. You’re drinking from a firehose65 right now while burning the candle on both ends60. It’s a perfect storm31. Profits are down, your visibility into the quarter is a little fuzzy37, and you don’t want to get thrown under the bus71. The organization is going through a re-org84 in an attempt to right-size16 and correct the perception, right or wrong, that there were too many Chiefs and not enough Indians56.

By way of housekeeping22, you know you need to increase mind-share with the customer85, but you don’t have enough boots on the ground20 to scale your marketing efforts. You need to treat the big deals as one-offs40, but you are facing some headwinds39 with the COO who wants to standardize. You need to put your game face on69 and manage expectations52, but you don’t know what to do and you don’t want the R33. But if we take the 30,000 foot view50, unless you want to be re-org’d out, you better take the R33.

Hope is not a strategy46, but you think that’s all you have. You don’t know the next steps73 or the competition killer76 that will allow your organization to move up and to the right83 and regain its profitability and its fame. You don’t have a go-to-market64 strategy, any paradigm shift1 would be outside your core competency38, and you don’t know what your next deliverable81 is.

But it doesn’t have to be that way. If you eliminate the ready, fire, aim45 approach, put a stake in the ground35, remember the old 80-20 rule51, put aside the basic blocking and tackling68, and do a level-set67, you’ll realize there is a radical solution. Procurement.

And while it’s good to put a face to the name49, it’s even better when you realize that it is the next-generation, turn-key, plug-and-play17 solution that will finally deliver the ROI5 you’ve been searching for. Sure you will get some push-back66 when you suggest it for the first time, but Procurement has it covered from soup to nuts70. Of course you should do a little more due diligence there43, but Procurement really is the cash cow25 you’ve been searching for.

And while you can expect that Marketing will sound like a broken record55 when you bring this up and continue to push their agenda, you need to circle back to that9 later, push your agenda, and loop them in82 when they are ready to cooperate. Once you’ve done your research and identified leading organizational best practices80, you’ll know that Procurement is the way to stop leaving money on the table44 and close the loop72 on organizational success.

There’s a reason that strong Procurement support has gone viral59 in leading organizations and that’s because Procurement’s constant quest for value-add63 increases profits. And while previous business fads have failed, this time its different79 because Procurement has to eat its own dog food28 and is very incentivized41 to buy premium.

MBAs, be sure to come back tomorrow as we explain, in your language, why you have to support procurement.

What is ARM, and why should I care?

Today’s guest post is from Peter Portanova, a Senior Project Analyst for Source One Management Services that specializes in the marketing spend category decision support for clients seeking to enhance their strategic marketing efforts and drive valuable agency relationships.

Relationships. Is there any institution more complex known to humanity? Whether between a group of people, or between a group of businesses, relationships are complex, messy, and often times, toxic. As businesses struggle to remain relevant in a volatile and fast-moving environment, the push to do more with less has never been so evident. In a well-circulated and often-rebuffed article from 2015 titled “Your Agency Hates You and You Don’t Even Know It“, the author attempts to identify the reasons relationships seem to fail (that is, if you are an agency and you are comfortable placing the majority of the blame on your client).

Consider the state of the marketing and advertising industry in 2015. Buzzwords like “Reviewmaggedon” and “Mediapalooza” dominated headlines, and the year ended with marketers parading through the streets when Pepsi decentralized their marketing procurement team. Fortunately, Pepsi’s decision does not indicate a trend, and an ANA survey to marketers reaffirms the value of procurement in the marketing process. To summarize the findings, many executives see value in procurements process, as long as it does not hinder the fluidity marketers require. However, the overarching question remains: How does procurement adapt their process to become more accepted by marketing stakeholders?

Enter, Agency Relationship Management, or ARM for short. Like Supplier Relationship Management (“SRM”) ARM works on the client’s behalf to ensure a fair and equitable relationship. There are many processes and services that fall under the umbrella of ARM, and procurement is well tooled to operate simply as a mediator, or as the manager of a full sourcing event. The ultimate goal of an ARM program is to enhance the relationship between a client and agency, and to ensure that expectations are clearly communicated and campaigns are integrated and executed seamlessly. Whether working with an internal team or an external third party, ARM programs ensure a best-in-class contract, and enable the client and agency to react swiftly when the market shifts.

“My relationship is great!” “My agency does everything for me!” “My agency does nothing!” “My agency is terrible!” Relationships between clients and agencies exist on a spectrum from love to hate, and require regular maintenance to remain viable. Consider a married couple in their “honeymoon phase,” believing all is well and that the relationship will last forever, or consider the alternate feelings of disappointment and anger. ARM exists as the marriage counselor during rough patches, OR as the open lines of communication and responsiveness when everyone is happy. Simply believing your relationship is successful now, and therefore does not require proactive measures can be detrimental over time, and may lead to the ultimate dissolution of the union (which is expensive, time consuming, and disruptive).

Aside from mediating and working as the communicator, ARM is hugely useful is evaluating current relationships, identifying future opportunities, ensuring competitive rates, and developing a scope of work that is fair and equitable. While relationship management might connote issues, the beauty of ARM is that is works to ensure issues seldom arise due preventative and proactive measures undertaken to ensure the constant delivery of value. Whether there is concern over scope, rates, or capabilities, the objectivity of a third-party outside of marketing works to alleviate to concerns. Furthermore, as noted by the ANA, having a separate business unit working on negotiations is hugely beneficial, and allows those engaging in tactical work to remain focused.

Always remember that relationships are mendable. Unless seriously damaged with fundamental issues, replacing an agency partnership should be a last resort. While there are certainly benefits in doing so, alternative solutions should be the first consideration. A full search is time and labor intensive, and hugely disruptive to current operations. Typically, issues can be resolved through the rotation of resources, or the assignment of new teams to provide additional benefits. Similar drawbacks exist for agencies, which are forced to dedicate additional resources, which may distract from the execution of tactical work. By having an ARM team and process in place, the process is far more manageable, and can begin with simply evaluating the relationship and identifying both positive and negative aspects. After such an evaluation, a process for resolution can be created, ranging in both complexity and extensiveness.

An internal department is a viable solution is for managing relationships, but additional benefit is available through the utilization of a third party. Market data concerning rates and contract terms allow for a greater advantage in negotiations, and flexibility in resources ensures clear communication leading to a rapid resolution. Whether establishing an internal department, or looking for a wholly-outsourced solution Source One’s expertise and experience are ready to assist you in the implementation of your ARM program.

Thanks, Peter.

Best Practices for Agency Evaluations for Strong Client-Agency Relationships

A good agency evaluation process helps marketers improve their return on
marketing investment through better relationship management, which translates into more high-quality work at a faster output and with improved quality results.

Richard Benyon, DecideWare
Surging Ahead, ANA Magazine, June 2016

But what is a good evaluation process?

Let’s start with what marketers do now. When evaluating an agency or a potential agency, marketers collect data and then apply that information to attempt to make better decisions in agency selection using a four-step process.

  1. Identify whether or not the agency has top talent.
  2. Optimize to ensure the talent is working in the most efficient and effective manner.
  3. Then, depending on the situation, fix problems or reward success.
  4. Work to improve their processes to enable the agency to do their best work.

This is a great process, but, as Richard says, before creating a new relationship or extending an existing one, it’s extremely important to have a clear purpose as to why an agency is being evaluated and what the evaluation should achieve. As Richard says, before beginning an evaluation, marketers need to understand:

  • how they will wunderstand agency strengths and areas for improvement,
  • how they will enable the agency to do its best work, and
  • how the evaluation program will be used as a component of incentive compensation.

A good relationship, like a good Procurement Value Engine, is effective (and uses agency strengths), efficient (and enables the agency to do its best work), and sustainable (and incentivizes the agency to continue to do its best work as time goes on).

In addition, it supports the strategic goals of the marketing department — which should be known before the evaluation process begins to make sure the organization knows which strengths and processes will best support the evaluation.

This means that it’s critical to ask the right questions in an evaluation — questions that will deliver actionable information relevant to the assessment at hand. Designing these questionaries is not easy. Not only do the needs of all departments interacting with the agency need to be met, but the questions needs to be focussed with respect to the strategic goals.

So how do you balance the needs with respect to the goals without overloading the agency with meaningless questions and useless work?

As Richard puts it, you need to be

  • lean,
  • impactful,
  • relevant,
  • consistent, and
  • reflective.

And, of course, get the timing right. What does this mean? And how do you do that? That’s the focus of Richard’s latest article by Richard Benyon on Surging Ahead. Check it out.