This first appeared as a guest blog in BizCommunity in South Africa and can be seen in full here.

2012 will be a year of solving the conundrums of marketing complexity. The world sitting in a now familiar state of uncertainty, with debt crisis, stagnant established markets and emerging growth markets, and continued pressure to deliver increasing returns. In the face of this uncertainty and continuing increase in fragmentation and complexity, marketers will need to develop more flexible responses to deal with a range of conundrums.

1. Chasing growth and maintaining share

Global marketers are looking for growth in the emerging markets, often funding this investment at the expense of maintaining or defending their existing markets. The conundrum in 2012 is getting the right balance between the two because under investing in established markets opens opportunities for competitors which could erode the funding required to penetrate the growth markets.

2. Knowing as many customers and as much about them as you can

Customers are no more diverse than before, it is just now they have a voice and power of numbers. Before, marketers could treat them as an amorphous group or segment. But now the individuals within that group can and do connect and share and flex their muscles. The continuing conundrum this year will be how to continue to reach a mass while being able to connect with the individuals within that group in the way they want.

3. Matching, making and managing channels

Everyone talks about owned, bought and earned media. But marketers struggle with getting the balance right. The conundrum appears to be to go for reach with the traditional bought media with little budget for investing in owned and earned, or invest in owned and earned media for greater engagement at the expense of reach. Striking the balance is difficult but in 2012, a “test and learn” strategy will provide the answers.

4. Working globally and locally

The idea of the global village is a reality with universal Internet connectivity. But it is a village of multiple communities and cultural diversity. Global and multi-national marketers are confronted with the conundrum that what they do in one market will be shared across all. Therefore in 2012 there will be an increasing need to have a consistent global strategy with aligned and localised implementation.

5. Having customers “Do” or “Know”

Traditional advertising has been focused on awareness. But following awareness is engagement. “Tell me how” is one thing. “Show me how” is another. But let me “do it for myself” is engagement. The conundrum is how to strike the balance in investment between driving awareness and engagement to meet expectations.

6. Small ideas or a BIG idea

You load up your advertising with the big idea, you aim it at the target audience and you fire. And you keep doing it until you run out of firepower – usually budget. But now fragmented targets require a more granular approach with an on-going “test and learn” process is replacing the old campaign model. The conundrum is that most marketing strategy (and its funding and execution) is campaign driven and so 2012 will be a year of transition.

7. Mobile for reach or engagement

The conundrum is not mobile or not, as any brand wanting to engage customers needs to think mobile (It is the main access to internet in emerging markets). The conundrum is how. With so much opportunity for reach and engagement, too many have failed using the mobile for awareness and there has only been nominal success in brands using mobile for engagement. But in 2012 that will change.

8. Collaboration or alignment?

To embrace complexity requires collaboration both within the organisation and across the organisations engaged. But the conundrum is that collaboration requires alignment. But aligned to what? Corporate objectives? CEO vision? Brand? Sales projections? The customer? The first step to creating collaboration is to agree what is it you are collaborating on and to what outcome. Internal and then external alignment.

9. Who owns digital?

Digital is not just the all-pervasive platform of marketing. It is the same across the whole of the business world. Websites, social media, and other external communications meet internal finance systems, inventory control and logistics. Nowhere is this more obvious than e-commerce. So the conundrum is who owns digital? This year the CMO, CIO and the CFO will become new friends for every company embracing social media and e-commence.

10. Pay for results or value but not costs

Much of the cost of advertising is simply a cost. The cost of media. The cost of agencies. The cost of production. But with the increased pressure on marketing and advertising cost, the conundrum is how do we move from this cost based approach to a value or results based model. It is no longer acceptable to be a cost of business, but for marketing to be an investment, this year we need to stop thinking about costs and start focusing on value and the return on investment.

11. Social media is in-house and out-house

While traditionally many organisations outsource their communications needs to specialist agencies, social media is causing a rethink. In-house or out-house? With the opportunity to engage your customer in a conversation it is not just a marketing channel, but also a customer service tool, a reputation management function and a customer relationship management application. So is it in-house? And if so who owns it? This conundrum needs to be answered this year.

12. Who is responsible for CSR?

The customer is talking about you. And not just your products and services, but the way you manufacture them, the way you treat suppliers and employees, the environment and in fact all aspects of your business. But it is not just another channel to be managed. The conundrum is how do you make Corporate Social Responsibility everyone’s responsibility.

What conundrums are you facing or dealing with at the moment? Why not share them here with a comment and lets see if we can solve them together.

To see this as a guest blog on BizCommunity in South Africa click here.

The perennial $64,000 question. Or in many cases a damned sight more. The fact of the matter is that it usually costs whatever the budget is that has been assigned by you – the client. In many instances, it costs more.

How often do you brief your agency to provide a TV concept within a given budget, only to have the estimates on the approved concept come in at 5%, 10% or even 50% higher? Or, how often do the estimates come in within a few thousand dollars of each other and within the budget? Does this really equate to the actual cost of the TV production?

What drives TV production costs?

The first driver is the concept itself. There is always a minimum production cost for producing a commercial, but theoretically, there is no upper limit. Often, the agency and film company will arbitrarily continue to add enhancements, contingencies and experimentations into the process, thereby driving up the cost – if there is no set upper limit.

What drives the upper limit is your budget or at least the upper limit of what the agency believes you are prepared to pay. This will be based on either the stated budget, or in the absence of this, previous budgets for similar executions, the level of importance which you assign to the campaign, your level of experience in such matters, and a range of ‘mitigating’ circumstances.

So what’s the solution?

At the outset, set a firm budget – before you brief the agency. This should be calculated based on:

1. The projected ROI
2. The planned media budget for the first year or phase of the campaign
3. The category in which you conduct your business
4. The strategic importance of the particular task

TrinityP3 has comprehensive industry benchmarks for assisting you in setting realistic budgets based on these factors. Having established your budget, you should have your proposed productions cost benchmarked at the concept stage.

Once your agency has responded to the brief with the concepts you are considering for approval, but before investing any more time or money in concept research or testing, contact us and we will provide you with an independent and qualified assessment of the cost of producing one or all creative concepts.

Our quantified and qualified estimates are provided within 48 hours of receiving the creative concepts and normally cost less than 1% of your production budget – a worthwhile  investment in anyone’s language.

But more importantly, it is invaluable in ensuring you have a realistic expectation of the real production costs. It enables you to control costs without compromising the quality or integrity of the concept before final sign off, which results in an avoidance of unforeseen budget overruns once production has commenced.

In short, you know precisely what you’re up for up front and you are able to minimise any unforseen financial variations.

I feel like I am constantly seeing reports and articles about the flaws of the advertising agency pitching process.  A common theme of these articles is the fact clients often select agencies based on their creative potential but usually fire them for relationship and service related issues.

So how can you ensure your pitch process builds the foundations for a solid long-term relationship?

TrinityP3′s top 5 tips on pitching for the long term

1. Have a clear understanding of what you want

What may seem the most obvious is often the most overlooked in the rush to get the pitch progressing.  It is worth really defining what you are asking the agencies to solve now and what briefs you may have after the pitch is over.

2. Plan it more like a test drive than a date or beauty parade

Whilst pitches have roughly had the same format over the years, it is important to determine the level of input you require from your agency after the pitch and build this into the pitch process.  If you require regular strategic input and insights from key staff at the agency including creative teams, we suggest a day long workshop with each of the short listed agencies to ascertain the chemistry not only in personality but in the solving of marketing problems.

3. Who is paying, you or them, because no one wants to split the bill

Regardless how great the creative solutions and how well the chemistry is going, if you don’t ensure you negotiate a framework that allows you to get the service you need at sustainable rates for both your business and the agency, the relationship is likely to fail over discussions that detract from the core business objectives.  It is also important to keep the performance criteria simple enough to be measured.

4. Be clear and up front in what you want and expect

Be clear in how you plan to run the pitch and how you plan to work after the pitch is over.  In any relationship that fails, it’s usually confusion over expectations that are the cause.

5. Be prepared to spend the time to really get to know each other

The average pitch can require 600 – 800 internal head hours.  As you are selecting a partner to help achieve key business goals it is worth allocating the time upfront.  It is also important key decision makers have the time to consider the agencies properly and not get caught up in the administration of the pitch.

These are mine.

What do you suggest?

Leave me your suggestions as a comment here and lets see if we can expand the list to ten!

2011 was a challenging year for marketers everywhere. We worked with many of our clients both regionally and globally discussing and addressing a wide range of issues including: marketing agency search, agency compensation, agency selection, agency contracts, business strategy alignment, advertising process improvement management, client agency relationships, supplier performance management and production cost benchmarking.

These issues often became the basis for blog posts throughout the year and it is indicative of the commonality of these issues that the blog posts were widely read and shared.

It is most interesting to see the topics that received the highest reader interest. Below are the top 10 blog posts for 2011 in descending order of readership.

Click the titles or images to read the full post.

10. Advertising agencies can demand to be paid for ideas and resources but where is the value?

This started out as a response to the column Robert Morgan, Chairman of Clemenger BBDO has in AdNews. Agencies talk about the value of ideas but the problem is that often agencies and advertisers have two very different ideas on what is the value of an idea.

9. Top 10 tips for fostering collaborative agency solutions

A call from a client in the dairy industry asking me if I have any practical suggestions on how to foster collaborative relationships between their various agencies. At the start of last year I spoke at ISBA in London on this and presented the ABC of developing collaborative advertising environments, and this became the follow up to that presentation and our client’s request.

8. The right media strategy is more important than the right price

This is something we have been discussing for years. The obsession for many marketers and procurement has been the cost of media. We see media agencies do battle with each other trying to prove they can buy media cheaper than their competitors. But there is a fundamental truth and that is no matter how cheap the media, it is wasted investment if it is strategically wrong. Right?

7. A blueprint for reducing your advertising production costs

There are many metaphors bandied around marketing and advertising, mostly tired old sporting and military ones, but when it comes to production there is much to the said for the comparison to building and construction. For the past 12 years we have been assessing and benchmarking our clients advertising production costs across television, radio, cinema, digital and print. There is a presentation on this you can check out here.

6. 10 tips for renegotiating your agency remuneration

For 18 months I was in irregular discussions with a client who decided that he would handle his annual agency negotiations. He contacted me six months prior to them needing to be finalised, which was a positive sign, but decided that following our discussion he could handle them himself, contrary to my advice. More than  a year later they still were not finalised so I sent him these tips. Obviously many people found them helpful.

5. Defining the scope of advertising agency services to determine agency compensation

I am often surprised by the number of marketers that ask if we could benchmark the level of agency remuneration and have little or no idea what the agency had actually delivered for the fee. It appears that many marketers are challenged by determining and defining the scope of work to be delivered by the agency, so this post helps to do that.

4. Top 10 considerations when selecting a new media agency

There were quite a lot of media agency tenders this year and time and again I found myself advising clients on what they should be considering when selecting a new media agency. I think one of the major issues with media is people often believe they have a clear understanding of media but can find themselves out of their depth on the details.

3. Why your agency may not be your best solution for digital strategy alignment

Investment in digital continues to outgrow all other areas of advertising, yet this year we found that many marketers were still taking a quite traditional view of their digital requirements. Many believed that their existing agencies were best placed to handle their digital needs, driven by the belief that this would “integrate” digital into their marketing strategy. The issue is what is your digital strategy and who is best to manage it?

2. Top 10 Questions to ask a strategic marketing consultant before you engage them

On January 14, 2012, TrinityP3 was 12 years old. Happy birthday to us! Twelve years ago we were the new kids on the block and since that time we have built a reputation for innovative, strategic and professional solutions to increasingly complex marketing management problems. But at a time when every person to be made redundant from an agency appears to hang up a consulting shingle, it was worthwhile defining what questions you should ask. Clearly many people agree.

And coming in at Number 1:

1. The Top 10 Most Common Ways Marketers Waste Money

This was a presentation that I put together for a client a couple of years ago. Early last year I was asked to do a talk for a client about ways of improving advertising process efficiency. I looked up the original presentation and on reviewing it found that highlighting poor performance in getting the basics right was more interesting than simply restating the basics. You can see the whole presentation here on Slideshare or as a video on YouTube.

As you can see, most of the posts come from clients contacting me and discussing issues they may have. So if you have an issue or a problem you want to discuss let me know and  it may well be something many other people are thinking about.

Or if there is something you would like me to write about, leave a comment here.

Who knows, it could make this year’s Top 10.

It is amazing how often a conversation about tendering for a new agency occurs without any substantial reference to the overall roster structure. The desire to appoint a new media agency, a new creative agency or a new digital agency is often made in apparent isolation. In late September I had a discussion with a Marketing Director about the desire to review all of their “major” agency suppliers – this being the three agencies where almost 90% of their budget was currently invested.

This opened the conversation beyond simply “who is the right supplier and how do we find and choose them?” to a conversation about “what is the right roster structure to deliver our strategic requirements?”

As a guide and as stimulus for this conversation I use the presentation above outlining the various major roster structures and the relative strengths and weaknesses. The main agency roster structures are:

1. The Full Service Agency
2. Holding Company Model
3. Created Customised Agency
4. Lead Agency
5. Strategic Group
6. Strategic Tier
7. Best of Breed

There is no one correct structure and in fact there are many hybrid models of these structures that all function effectively. The important step is to define the strategic requirements and match the roster to those requirements.

Therefore when the Marketing Director was talking about the major shift they had in mind for the brand beyond simply position, but one that would impact the marketing investment mix and the channels, it was the ideal time to review the overall roster structure to ensure it was aligned to the new strategic marketing requirements.

This approach then made it much easier to then assess if the current supplier structure and mix was aligned, by defining the requirements of the supplier roster strategy. I am a big believer in the strategy of “changing your agency is smarter than changing agencies” and have found that this approach ensures that most of the emotional and subjective drivers for the new Marketing Lead to change agencies are put to one side and a more strategic approach based on the immediate and future requirements of the brand is embraced.

Even if this strategy leads to the incumbents being asked to re-pitch for the business, it is done with clear requirements in place for which they can prove their suitability rather than being led through a process to be rejected for often ill-defined and usually personal reasons.

And I have found a good starting point for this is to review the current roster structure against the various models available.

I would be interested to know if you have worked with a roster structure outside of the ones I have defined here?

And how successful was it?  And under what circumstances?

Let me know in the comments here.