Category: We Love Our Customers


According to a new IBM study, CEOs and senior public sector leaders around the world are responding to today’s connected era with extensive partnering in order to achieve radical innovation.

Easier said than done.

How do leading executives partner successfully – both internally and with 3rd parties?

As a Corporate Trade organization whose business model depends entirely on a high level of partnership and relentless collaboration, we naturally have an opinion on the subject.

When done well, collaboration can translate to real bottom line benefits.  When done wrong it’s a missed opportunity—not to mention a waste of time.  And in times where no dollar should be left on the table, the second alternative is really no longer an option.

I’d like to share a unique customer story with you that touches on both ends of the spectrum using the Corporate Trade model.

A successful Canadian Industrial Apparel company approached Active International years ago because they were seeking an innovative way to solve an inventory management problem.  The CFO, who loved  the Corporate Trade model from a financial point of view, signed a million dollar deal.

The inventory had a market value of $457K. This Corporate Trade partnership would give the company $1.37MM for the same product, and they’d maintain full control of where the product was re-sold.

An incremental return of almost a million for very little effort? It was a no brainer.

With such a lucrative contract, why then, did it take years for the concept of our partnership to materialize?

Internal Alignment is Key to Corporate Trade Success

The Corporate Trade model (aka Corporate Barter) depends on different business units working together in alignment in order to work quickly and effectively.

In this circumstance, Finance controlled the inventory decision, and Marketing controlled the media planning and execution.  Marketing is (rightfully) very careful and selective with whom they trust their media.

So when the finance manager knocked on the marketing manager’s door “telling” them to place their media through an agency they hadn’t yet met, the idea didn’t get the warmest reception.

And with a million other things on Marketing’s plate, the unfortunate result was the trade credits were not leveraged.  The partnership came to a standstill, and the organization ran the risk of taking a loss instead of the intended incremental gain.

The Turning Point

In order to ensure our customer realized the outstanding return they were promised, we took action.

We got the CMO and CFO together for a collaborative discussion.  It was the perfect opportunity for all parties to air their goals, priorities and concerns, and for Active to clarify, educate and simplify.

The hour was well-invested indeed. After achieving 100% alignment, a 3-year trade credit redemption plan was put in place and all departments were engaged.

What happened next far exceeded the company’s expectations.

The Bottom Line

  • In addition to leveraging trade credits for their media, they now enjoy a 15-20% savings on all of their print/packaging and retail merchandising initiatives (store fixtures, custom display shelves, retail banners and packaging for their product)
  • Through Active Freight & Logistics, they pay between 12%-15% of their freight invoices with trade credits
  • Because the company overall has embraced the CFO’s initiative, over the past 3 years they have tripled their trade credit redemption rates, which has far exceeded original forecasts

Needless to say, when all departments are engaged and work collectively on the planning and execution of a project, it’s easier to manage and reaps more rewards.

In this case, to the tune of just under $1MM.

YOUR TURN

Partnership. Collaboration.  Alignment.  Corporate buzzwords or essential to bottom-line results? We’d love to hear from you.

Mobilicity Seeks a Marketing Specialist

One of our awesome customers, Mobilicity, is on the hunt for an outstanding Marketing Specialist and we wanted to help spread the word.  Mobilicity’s new Marketing Specialist will play a lead role in supporting the Marketing team across Mobilicity’s pricing, promotions, and products/services portfolio. This person will be responsible for supporting the end to end implementation of a variety of critical projects that drive Mobilicity’s key business objectives.

If you’re up for the challenge, or know someone who is, be sure to check out their career page today.

About Mobilicity

“We’re small in size but we’re making big plans and big decisions. Without big company politics. Or big egos. We’re different. And the way we see it, that’s a good thing. To build on the momentum we’ve generated, we need people. Smart, Energetic, Passionate, Confident people.
 
We want Leaders. Not followers. People who get the wireless world. If you’re one of these people we invite you to consider joining us. Now that’s smart.’

Over the years in my career as a Marketer on the client side, I’ve worked with a good cross-section of ad agencies.  And I love working with them.  The creativity, fun, innovation and energy associated with the agency world are both infectious and inspiring.  But admittedly, there have been times where I just wish they’d put my business hat on and see things through my reality.

Out of sheer curiosity (and an anticipated chuckle), I read an article based on a study from the ISBA  on what clients really want from their agencies.  How would this compare to my own experience?   The study confirmed that only 36% of clients surveyed thought agencies delivered exceptional value for money, and only 31% of respondents seeing their agency as a full partner.

 “There is a sense that ad agencies are losing their place at the top strategic table and are in danger of being seen as an executional resource only.”

In times when nobody can afford to lose business, strong relationships are important.  And in order to retain your client’s loyalty – you need to give them a reason to.  You need to bring differentiated value to the table beyond the scope of the last brief. And to get that strategic seat at the table, you need to innovate for it.

Value for Money

Define “value”?  With agencies busting their you-know-what, yet being marginalized by clients every day… what can they do to add more value? Of course in order to do that, they first need to understand what the client is really up against?  Many marketers are facing internal political pressures, fighting for resources, struggling with the need to do more with less, and dealing with the unwavering need to justify their costs (including agency retainer fees).  Some notable client quotes from the ISBA survey:

They need to spend more time understanding our challenges and goals.”

“I want to see agencies improve their awareness of the business context in which clients operate. They need to understand this before they start the creative process. Too many agencies come up with an advertising solution without contextualising it against the client’s business objectives.”

Teamwork

One of the issues that seemed to elicit some of the most negative responses in the survey was teamwork. In the survey, 37% of clients disagreed or were neutral on whether agencies work well in a team.

 “There’s nothing that bugs a client more than turf wars between agencies. They just want them to work together and get on with it.”

So What Can Agencies Do About It?

Some agencies are already earning their strategic set at the table by addressing these two key issues. I’d like to share an example with you. An international travel and hospitality business suffered a tragic and highly publicized disaster involving of their fleet. In efforts to recoup dollars, budgets were slashed, including media dollars… right before a campaign launch. The agency knew the net result wouldn’t have facilitated enough reach to meet the client’s objectives.  Instead of making do with what they had, the agency reached out to us.

Working together, the client, agency and Active landed on a win-win solution. The Corporate Trade model was leveraged to unlock additional value to boost the media campaign budget and reach.  Once the agency realized the multiplier affect trade had on their client’s advertising budgets, the cat was forever out of the bag. The result?    A strengthened relationship between client and agency, and a new means for the agency to add value to their broadened client base.

A Note to Clients

The responsibility of a true value-added relationship isn’t entirely on your agency’s shoulders. If you want your agency to be a partner in business, treat them like it.  Give them a challenge. Share with them something you’re struggling with, or simply give them a problem statement and tell them you want them to break new ground—strategically, creatively, whatever. And see how they respond.

I’d love to hear your stories on how your agency or client adds innovative value to the relationship. Have you innovated to solve a bigger business problem through multi-agency teamwork?  Email me at karmstro@activeinternational.com

Cheers

Kim @ Active

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