SITUATION

As part of an organization-wide procurement transformation program, a B2B services company wanted to bring its marketing spend under more stringent management. The organization’s spend was largely decentralized, with each line of business (LOB) running its own processes to manage suppliers. There was no cross-functional category management plan in place and as such procurement engagement was occurring very late in the purchasing cycle.

SOLUTION

To ensure the company was maximizing benefits from its marketing spend and to address the lack of internal experience in sourcing this category, the CPO decided to engage an OnDemand Partner with significant expertise in delivering successful outcomes in this category.

The OnDemand Partner collaborated with internal procurement and marketing team members to understand the contractual agreements that were currently in place and to build up a holistic, cross-functional picture of the firm’s engagements with its marketing suppliers.

The analysis revealed that suppliers were not being leveraged across the organization. Different LOB’s had negotiated different rates and SLA’s with suppliers providing the same service (in some cases with the same supplier).

In order to centralize, consolidate and manage marketing spend more effectively, OnDemand facilitated a series of procurement-led RFP’s. The RFP’s included provisions for creative, advertising, digital marketing, trade shows, PR and market research.

RESULTS

The market analysis carried out by OnDemand provided visibility into marketing spend across the organization’s various LOB’s. This insight was directly transferred into a series of RFPs that, once completed resulted in the organization being able to actively manage its spend and supplier relationships across the different LOB’s.

The RFP process enabled the organization to consolidate over $40 million of spend under management and offer increased volumes to suppliers. This resulted in over $2 million in savings through more favorable rate, terms and discounts, and also streamlined the internal supplier relationship management processes. Suppliers are now closely monitored and managed in order to ensure costs are controlled and value is being driven from each marketing engagement.