Media Management

Commercials, Compliance, and Continuous Improvement – Amy Redford’s Three C’s for Trust and Transparency in Media.

Evaluating ROI

“What I mean by performance is measuring the efficiency and effectiveness of what the media actually delivers, versus the targets that were set in the beginning. [This] ultimately helps you to evaluate ROI”

Serious column inches have been devoted to trust and transparency in Media over recent months. Understanding the media investment in terms of both value and performance is now a core responsibility for Marketing Procurement professionals.

However, it’s no mean feat to simultaneously manage risk, improve return on investment (ROI), and demonstrate added value in what is typically an organisation’s highest commercial expenditure.

Global Media Category expert Amy Redford, Consultant and former Head of Global Media Procurement at eBay, shares her three C’s to achieve trust and transparency in Media with Marketing Procurement iQ Magazine.

From Politics to Procurement

Amy Redford’s journey into Procurement began immediately after University. With a degree in European Politics and Languages, Redford was looking for a graduate scheme to make use of her language skills.

The Procurement Graduate rotation programme at Peugeot Citroën seemed a good fit, as Redford recalls “I didn’t really know what Procurement was, but it sounded  interesting… to work with different people in different parts of the company, and to speak French… let’s give that a shot.”

For Redford, as for many of us, “the stars aligned.” She fell in love with a discipline where “you learn so much, you’re exposed to so many parts of the business, it’s… a strategic role, and you get to influence a lot and, frankly, just learn every day.”

Trust, Transparency and the Price of Pasta

Redford’s insatiable appetite to learn has driven her 22+ years career at blue chips including Kraft Heinz, eBay, Peugeot Citroën plus retail and Consulting with roles across Indirect spend, covering all the major commercial and marketing categories at regional and global levels.

Her thirst for knowledge even prompted a switch to buying ingredients for three years as she challenged herself on the direct materials side of Procurement.

These broadening experiences underscored the need to delve into the nuances of a specific category. “You might have to upskill in specific key areas, like learning about crop cycles or learning about commodity markets for buying grains… [but] the basics of doing a contract, doing a negotiation, doing research in the market remain the same.

” These Procurement fundamentals are endlessly transferrable, and Redford jokes that whether negotiating the price of ravioli or a percentage inventory media cap, the level of trust and transparency in the supplier relationship is critical.

Amy Redford will be speaking at the Marketing Procurement iQ Conference on 26 March in London. Book Now

Achieving Trust and Transparency Through the Three C’s

For Redford, the definition of transparency in media is crystal clear. She speaks of gaining “a full understanding of the media investment in terms of value and performance. What I mean by value is what you pay for the media versus the market price and versus the actual cost of that inventory.

And what I mean by performance is measuring the efficiency and effectiveness of what the media actually delivers, versus the targets that were set in the beginning. [This] ultimately helps you to evaluate ROI.”

The definition of trust is a little more nuanced. Redford describes trust as a spectrum, with high trust partnerships underpinned by the first C, best-in-class Commercial terms. This is scaffolded by the second C, holistic, proactive management of Compliance with performance assessment, and a focus on the third C of Continuous improvement.

In the best client-media agency relationships, open, honest communication is based on objective, timely data and should include setting shared goals and commitments particularly for high value investments.

But as in all relationships, trust in media must be earned. “I work on the principle that I keep my friends close, and I keep my agency closer,” Redford smiles, adding “the goal is to be demanding, yet fair and a client of choice.”

The Right Commercials Set the Foundation

The right commercial terms set the foundation for transparency. Redford explains that understanding where media agencies make their money is essential, pointing out that “it’s not in the fees, it’s in how they manage your investment.” Redford cautions that addressing transparency at the outset is critical, and best tackled as a pre-condition to participation in a media pitch.

Trying to reset transparency terms mid-contract is particularly challenging in media, as “introducing those new contract terms is very material to the media agency because it impacts how they can operate, what flexibility they have in their own trading, [and] ultimately, how much money they will make.”

Redford lists a slew of key contract terms to cover, delving into the category-specific nuances with her finely honed media expertise. Clauses governing principal vs agent trading, volumes of inventory media and agency volume bonuses (ABVs) are critical for transparency.

This needs to be paired with a well-defined management fee structure, the right performance-based remuneration approach, and a balance of other financial metrics, will ensure a fair deal for both sides, fostering trust on the agency side, and “faith in the client, …that we’re going to treat them well and fairly.”

And a clear auditing and performance measurement schedule setting out rights, responsibilities and cadence of monitoring ensures expectations are clear from day one of the contract.

Redford advises her peers to lean on resources published by trade bodies such ISBA and the ANA to navigate the complexities of media contracting.

Even media category veterans will build the most robust contracts using a baseline of best-in-class terms, and benefit from updated contract language on emerging issues like performance-based payment mechanisms for influencers, and data privacy in the context of Gen AI.

Redford also advises to partner with your contract compliance auditor as the expert to help draft financial terms and audit rights. She also recommends bringing in specialist media legal counsel during negotiations to support inhouse legal teams.

Proactively Managing Compliance builds Transparency and Trust

Compliance, the second C, involves regular auditing of both contractual and media performance. Timely, data-driven interventions are the cornerstone of a holistic performance management process, including regular 360 degree relationship feedback.

Redford stresses the need to be intentional here, as “the audit work has to make sense. It must bring useful insights. It should be done as real time as possible in order to surface any issues immediately and bring  maximum benefit to the relationship on both sides by addressing issues together and building trust.”

In the case of inventory media for example, pro-active monitoring ensures that the agency is staying within the cap, so that corrections can take place throughout the year.

The same principle should apply to tracking credits from ABVs, as “it’s not necessarily always a good surprise if you suddenly get $500,000 coming back” at year end without the time to actually allocate it for reinvestment. “It’s the opportunity cost of how we could have invested that money if it had been managed better,” Redford adds.

Continuous Performance Improvement is a Cross-Functional Responsibility

Driving the continuous improvement of trust and transparency is a cross-functional responsibility in Redford’s view. She describes the optimal governance structure as a wheel, with Marketing Procurement alongside media operations at the hub, jointly leading the supplier relationship management (SRM) effort.

Each spoke represents an expert partner from Finance, Controlling, Legal, and Internal Audit, as well as external compliance auditing and performance measurement partners, giving marketing teams access to all of the experts, data points and intelligence that they need.

Within this framework, open and honest communication and a trusting partnership will continue to drive up ROI, overcome challenges and strengthen future media performance.

In this model, Redford envisages Marketing Procurement taking on the role of “media investment managers, sitting alongside the Heads of Media,” with dotted cross-functional reporting lines outside of the Procurement function.

Measuring the Added-Value of Media Marketing Procurement

Evaluating the performance of media Marketing Procurement also benefits from a cross-functional lens. The outdated notion that only media management fees are ‘addressable’ spend, (spend that can be influenced by Procurement interventions), and only net price reduction counts, misses the point of the media agency business model entirely.

Redford advises broadening performance metrics to include not only inventory variance vs market price, but also compliance metrics, performance metrics, and ultimately impact on ROI.

As Redford reflects, “the media mix might have changed, but in terms of what that spend delivered versus the target, it should be possible to compare using efficiency and effectiveness metrics to assess value.

And if you deliver more than the baseline, arguably that’s added value [that] you should be able to report… So, although media is complicated, the benefit is that you have a lot of data points that you can use.”

The perception of Procurement’s value-add from a Finance, Marketing, Legal, or Compliance viewpoint is likely to be much broader, so these stakeholders can act as advocates to build the business case for Marketing Procurement’s value proposition.

Redford’s three C’s for trust and transparency in Media Procurement can demonstrably drive business results, and they also signpost a route to strengthen Marketing Procurement’s contribution. Get the Commercials right up front, monitor Compliance and performance, and strive for Continuous improvement.

The resultant transparency and trust will boost ROI, and also generate the datapoints, cross-functional alignment and track record of success to establish Marketing Procurement as invaluable media investment managers.