There's a saying that's been around for about four years: Marketing is the new Finance. Because of digital advertising, measurement is not only possible but paramount. I think Adobe SVP of Marketing Ann Lewnes said it best. "Data is the digital revolution's gift to marketing".
Those of us who have been in corporate trade for the past 20 years, we have a different interpretation of the phrase, Marketing is the new Finance. To us it means, Marketing is the decison maker, as it should be. Inevitably, our industry has evolved through the years. There was a time when Finance reviewed the financial benefits of corporate trade and ultimately approved or disapproved the transaction. If an approval was made, Marketing was informed of the trade transaction and asked to begin the process of working with the trading company on the media to be placed as part of the financial transaction. In the early days, Marketing didn't have as much say in the approval process of a corporate trade.
Yes, Marketing IS the new Finance. The pendulum has swung and now, much of the vetting and approval of a trade transaction is led by Marketing. Evergreen-Partners sees this as a benefit for companies considering trade in today's marketplace. Remember that the payment made to a client is in media. Without a successful placement of the client's advertising by the trading company, the financial value of the transaction is in doubt. Marketing needs to confirm that the trading company can indeed place the advertising that has been planned and budgeted by Marketing.
As the pendulum swings, however, it's not surplrising that Marketing often remembers the days when media wasn't discussed beforehand and when marketing plans changed unbeknownst to Finance. Marketing therefore now assumes that the resulting media problems are preordained. Their belief is that trade doesn't work. And for those marketing professionals who suffered through an ill-conceived trade, we understand their reticence to get back on the horse and ride.
So, we have a few considerations that we believe will help Marketing determine whether the trading company's media placement will fully measure up to the initial promises of the trading company. Keep in mind that trade works exceedingly well under the right circumstances. Are your circumstances right for a corporate trade relationship?
- The amount of uncommitted future media planned by your media department is at least 5 times the amount of the advertising credit being issued by the trading company
- The trading company is given the chance to review a representative portion of the upcoming media plan complete with costs and anticipated commercial terms. Any reputable trading company will gladly sign an NDA prior to their media evaluation.
- You, as the client, have been given a transparent look at the trading company's media delivery platform. You are clear on the types of media they routinely place, how they gain the necessary lower cost with the media vendors, remedies for missed spots or lower ratings (just like agencies occasionally encounter), and their research and reporting tools and capabilities.
- Your advertising agency has been brought in early to the evaluation process and has had the opportunity to ask the right questions and meet the people placing the media through trade. In the "old days" the agency was even behind Marketing in the process of evaluating trade. Not an empowering experience for them, to say the least.
- An arrangement has been proposed for Marketing to share in the financial benefit of the trade. Often this is not needed, but for organizations who are structured financially to spread the benefit beyond Sales, Operations or Finance, this can be ideal for motivating Marketing to accept trade.
- You are comfortable with the person at the trading company who will be your day-to-day contact. Don't let the senior people at the trading company monopolize your conversations. Get to know the person handling your account – just like in an agency review.
Armed with this information, your marketing people won't be left to guess as to whether or not corporate trading will integrate well with their media plans. If it is ultimately deemed by Marketing that trade is not right for your organization, then you can be assured that the decision was made based on facts, rather than on a preconcieved notion or stereotype.
As the trading industry has evolved, and companies like Evergreen-Partners emerges to provide clients with superior media delivery platforms, it is our hope that Marketing will take an important seat at the table evaluating trade for the benefit of their organization.