Agent scoring or: “Save 10 to 20% of your service budget – risk-free!”
Optimization of marketing budgets through professional agent scoring
The customer
Different customers from different sectors have taken advantage of 2 hm & Associates’’ experience in the topic of marketing efficiency through agency scoring. Successively we would like to introduce one of these projects as an example.
The project: Budget optimization
For our clients, for years a comprehensive portfolio of external service providers grew historically. This dealt, for example, with online and offline communication agencies, service providers in the printing industry or also data capturing.
Such a portfolio is normally subject to no real cost or quality controlling, because long-term cooperation only seldom questions the quality of the services provided or also the price-performance ratio. Often, large portions of the marketing budget can be saved without losing quality. However, such budget optimizations require established brand and marketing knowledge, along with the themes shopping and agency comprehension. The arbitrarily shortened budget in the classic cost cutting mentality in many cases results in fatal disadvantages for market leadership.
The focus of our activity was thus always the increase of service quality with simultaneously decreasing costs.
The task
Evaluation of current and possible new service providers based on personalized evaluation models for the increase of marketing efficiency and increase of service quality.
2hm & Associates took 8 steps here:
- customized adjustment of a proven agency scoring model
- identification and evaluation of savings levers in the entire process of service provider management
- evaluation of the agencies together with the internal agency adviser and the interfaces involved
- identification of overpriced agencies, or agencies lacking quality
- anonymization of the offered service and their retendering
- evaluation of incoming offers and the planning and implementation of sales pitches
- support with the selection in terms of contracting the new agencies
- contractual realization of the conveyed cost decrease potential for service providers and lifting the savings lever in service provider management
The realization
In the first step, workshops and individual conversations were carried out with all employees from all departments. These initially served to sensitize the employees for a higher feeling of quality. On this basis, the next step followed with the adjustment of the proven agency scoring model to the individual needs of our clients. Here, the external service providers were summarized in a comprehensive agency profile This agency letter comprises all relevant information about the service providers, like, for example the service portfolio, price classifications or verifiable industry competences.
In terms of (individual) conversations or also through automated online capturing tools, the evaluation of individual agencies occurred by the internal agency adviser based on the previously developed scoring model.
The results are compared to a private benchmark database by an experienced 2hm-consultant who has advised agencies in corporations for years. This 2hm exclusive benchmark database includes information about more than 2000 agencies, about average market and differentiated agency prices and production costs, along with established sample contracts for new agencies and an own price and quality index.
Through the bundling of agency listings, the use of basic contracts, the process instruction for agency evaluation and the establishment of lead agencies can make the purchasing process occur in a standardized manner in the future and thus later contribute to a more efficient organization.
After this, the client was included for the deliberation about which services were to go in a retender. For this, the existing service contracts were analyzed, the offered service standardized and the new potential service providers identified. The following pitch phase is organized, supervised and, upon request, also anonymously conducted in the first phase by 2hm. Finally, the real savings factors with the same or increase quality are filed monetarily.
The result
Through the noticeable increase in the quality of external services and the effective cost reduction for significant portions of communication measures, the marketing efficiency is increased for the long-run and lever effects in production are reached.
The implementation of the previously identified measures allowed for savings of around 10-20% of the service provider budget. Here, the additional savings potential, which could be generated through the follow-up negotiations of the 2hm consultants with the remaining recommended agencies, however, was not considered.
Through the reduction of the advising complexity, finally, also the brand competence of the agencies was additionally increased. The transparency in the agency landscape achieved through this leads to a sensitizing of private employees in regards to the meaning of brand management, the quality of agencies, but also the costs connected with this.
Due to positive experience, 2hm also often offers its customers a model dependent upon success for the implementation of processes in the company.