02 October 2003
Purchasing and marketing departments, along with their agencies, are equally to blame for the distrust that stifles better procurement of marketing services.
Graham Hinton, director of advertising agency Seven Worldwide, said: "Purchasers traditionally believe that agencies always overcharge for their services.
"Buyers should ask themselves not what is the cost of the service, but what is its value."
But marketing departments and agencies working with them were also at fault, he said.
There has been "a massive failure" in their ability to communicate the value of what they bring to a brand, enabling purchasing to better understand what they are buying to put a price on it.
"Communication is their business, yet they have not done this very well," he said.
Mike Straw, director of training and coaching organisation Achieve Breakthrough, said purchasers should not start off a relationship on what could be seen as a negative cost-cutting note.
"If the message is your job is to take cost out, this will not be good for starting a better relationship," he told delegates.
"Better to say that you are there to help them spend their money more wisely.
"But this will call for a new way of operating."