It’s A Numbers Game Today

Several high profile clients are shopping around for new agency partners, but there’s a catch according to The Wall Street Journal.

“The chief procurement officer has become more important than the chief marketing officer inside some companies,” says Joanne Davis, a new-business consultant in New York.
About 80% of reviews now include procurement departments, up from 30% to 40% about five years ago, consultants say.
On Thursday, WPP’s JWT pulled out of a four-way contest for United Parcel Service’s $140 million account because the review was largely being led by procurement executives eager to push down costs, according to a person familiar with the matter.
In a memo to his top executives, JWT Chief Executive Bob Jeffrey said the review “centered on protracted legal/contractual/financial discussions that are not in the best interests of JWT.”

Times are tight. Everyone knows that. But penny pinching, while likely necessary, isn’t going to solve marketer’s problems.
[UPDATE] Ad Age has more on the procurement push back from agencies, JWT in particular.

“UPS is a big business with a very big problem to tackle,” JWT Chairman-CEO Bob Jeffrey wrote in an e-mail to colleagues. “They need to treat us or any agency as a partner, and it doesn’t seem that is in their culture. We’ve invested significant time and energy in pitching this business, so we are not taking this decision lightly.”

Damn, Brown’s not doing much for Bob Jeffrey.

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About David Burn

Native Nebraskan in the Pacific Northwest. Chief Storyteller at Bonehook, a guide service and bait shop for brands. Co-founder and editor of AdPulp. Contributor to The Content Strategist. Doer of the things written about herein.

  • http://adpulp.com whateva

    AdScam commented on Jeffrey’s allegedly bold move too. Can’t help but think Jeffrey is full of shit. He pulled out because he knew his shop would not win. It makes little sense that WPP’s JWT would deem UPS no good, while WPP’s Ogilvy goes after the account with guns blazing. JWT is hardly above dropping their trousers to appease any client. Plus, as this post points out, procurement types are the norm. So if Jeffrey can’t move with the times, is he not demonstrating a certain dinosaur-like quality? A real leader in today’s environment must find ways to make a big client like UPS profitable – financially and creatively – for the agency. Besides, do you think for a second that if UPS called Jeffrey today and told him they wanted to give him the business, no questions asked, he wouldn’t drop his trousers immediately? Another point to consider: per an earlier post from you, perhaps UPS should have opened the search to smaller, more integrated shops who are used to producing under tight timelines and tighter budgets. Ultimately, Jeffrey shows that BDAs are not equipped to service today’s clients.

  • http://adpulp.com David Burn

    Jeffrey could be full of shit, but I think the battle to maintain fees and be seen as a partner, not a vendor (of the Wal-Mart variety) is very real.

  • http://adpulp.com whateva

    Agreed. But it still flies in the face of other WPP shops pursuing UPS. Additionally, if clients are seeing agencies as vendors, is that not also the fault of agencies (especially BDAs) creating a parity/generic marketplace? Honestly, it’s not like JWT staffers are homegrown. And JWT’s work is hardly distinctive to the agency. Ad executives’ nomadic ways are contributing to the parity too. When you become parity, you invite the vendor pigeonholes.

  • http://www.bullshitobserver.com todd

    Brown shoots itself in the foot by having number guys driving the van on this one. The agency that wins this business is going to find ways to do the work more cheaply, which means less craft and ideas and more beige rectangles with brown images in them.
    Oh, and half-scripty type. Can’t forget that.
    Tell you what, Brown. I’ll do your creative for half of whatever your lowest bidder tells you.