When I asked the Strategic Sourcing & Procurement LinkedIn group members to suggest topics for upcoming calls, there were a lot of requests pertaining to indirect spend. So, this Friday, the group’s July member conference call will be an open discussion on indirect categories (marketing and consulting will definitely be covered – if you have [...]
Read the rest » Supply Excellence
Another category identified for cost savings in last week’s Top 5 Categories to Source Now webinar was commercial print (full webinar replay here). With marketing typically driving decisions on commercial print, it’s a category many companies have had trouble bringing under management of the procurement team. However if approached properly, commercial print provides great opportunities [...]
Read the rest » Supply Excellence
The media buying market is has moved into unfamiliar territory lately. So unfamiliar that even the granddaddy of advertising itself, The Super Bowl, has had to resort to lowering prices. The market has softened so much that for only the second time in the history of the Super Bowl, advertisers are getting a [...]
Read the rest » Supply Excellence
This week, we posted on early signs indicating some manufacturing jobs are returning to the US in select sectors and regions. I still think the evidence is anecdotal at this point. But if manufacturing jobs are truly to return to the United States, it will take a convergence of conditions to happen in any significant, sustainable way. A combination of politics, labor costs, currency rates, consumer demand, and a host of other variables will need to be favorable in order for more companies to scale up or shift their operations stateside.
Some of those factors are beyond the control of individual companies, manufacturing trade groups and even the industry as a whole. But … they can help to drive consumer demand with a combination of good products (at competitive prices that people want to buy!) AND marketing/advertising. So on the marketing front, it’s great to see the manufacturing industry getting creative and making use of social media to help get their message across:
Hat Tip to Mojo for sharing this gem.
Justin Fogarty is Managing Editor of Supply Excellence. For any questions or feedback on the blog or its contributors, Justin can be reached at jfogarty[at]ariba.com.
=0)document.write(unescape(‘%3C’)+’\!-’+'-’)
//–>
Read the rest » Supply Excellence
Despite the widespread use and success of reverse auctions, Ellen Terchila, a consultant in the Spend Management Services group at Ariba, says many procurement pros still struggle with when to use them, when not to use them, and what categories to target. So, I asked Ellen to recap the key take-aways from a session she held on reverse auctions this week in Nashville.
***This video was shot at the Ariba User Conference in Nashville on 10-12-09. All of the video from the event can be found in a Playlist here.***
Justin Fogarty is Managing Editor of Supply Excellence. For any questions or feedback on the blog or its contributors, Justin can be reached at jfogarty[at]ariba.com.
=0)document.write(unescape(‘%3C’)+’\!-’+'-’)
//–>
Read the rest » Supply Excellence
Despite continued sluggish newspaper sales, there is some good news for advertisers who utilize newspapers to reach their target audiences. Although it may seem counter-intuitive, given that newsprint prices – a major cost driver for the newspaper industry – are actually rising, the dynamics of the newspaper industry and the additional media channels that publishers hold, creates an advertising buyer’s market.
Business Standard sums up recent movement in the newsprint market:
Newsprint prices, which have remained depressed for the last three quarters, are set to move up by about 11 per cent in the next quarter. With international suppliers announcing a price hike of $50-60 a tonne from next quarter, domestic producers are contemplating a similar increase.
This development follows a series of international price increases that were enacted in the 3rd quarter of 2008 that cumulatively will raise newsprint prices by $180 a tonne in nine months.
Collectively, this represents a perfect storm of bad news for struggling newspaper publishers when we considering the rapid declines in newspaper consumption in recent years. However, these negative developments for publishers equate to an interesting buying opportunity for print advertising space.
Newsprint price hikes have historically been passed onto the consumer in the form of rising newsstand and subscription costs. However, in the modern, crowded media sphere of 24hr news channels, free online news sites, and even news delivered electronically to smart phones, there is no longer a captive audience for newspaper publishers to target. Circulation directors are reluctant to raise prices out of fear of accelerating circulation reductions to lower cost, often free, consumer alternatives. With pass through price increases non-viable options, publishers are providing larger amounts of printed space to advertisers. Ad revenue has long since eclipsed circulation as the key revenue generation lever for publishers.
Advertising rates depend to a large extent on circulation and the current downward spiral of newspaper sales provides advertisers a strong negotiating position. At most large newspapers, advertising revenue accounts for nearly four times the revenue that circulation produces. In fact, circulation revenue is frequently barely enough to cover the paper the news is printed on. Publishers have little choice but to keep the cost of the newspaper down to maintain a broad circulation while simultaneously selling ad space at reduced rates to maintain volume and revenue.
However, market dictated advertising rates are falling spurred downward by steady drops in ad sales within the industry this year. Q1 sales were down 29% from the same quarter a year ago, and Q2 were down 28%, according to the Newspaper Association of America. Most analysts expect around the same percentage drop for Q3.
Newspapers are increasingly dependent on ad revenue and market conditions are such that print media advertising is in the middle of a tremendous buyers market. The print media has been in transition for the last 10-15 years and most newspaper publications have expanded into multi-media in order to stay relevant and viable. Traditional newsprint is not going away and still offers a powerful tool for presenting products to customers. As such, savvy media buyers should be looking to leverage the downward movement of print advertising into more lucrative multimedia deals that utilize the full potential of a newspaper publisher’s multi-media capabilities.
Nick Cherrone is a Category Manager for business services in Ariba’s Global Services Organization. Nick has several years of sourcing experience with General Electric and as a logistics officer for the US Army. Nick is recognized by the Institute for Supply Management as a Certified Purchasing Manager (C.P.M).
Opportunity for Advertisers”
s.channel=”Newsprint Price Increase => Opportunity for Advertisers”
s.heir1=”Newsprint Price Increase => Opportunity for Advertisers”
/* Conversion Variables */
/************* DO NOT ALTER ANYTHING BELOW THIS LINE ! **************/
var s_code=s.t();if(s_code)document.write(s_code)//–>
=0)document.write(unescape(‘%3C’)+’\!-’+'-’)
//–>
Read the rest » Supply Excellence
After the big GameBoy success there was an era, that did not felt really Nintendo. Namely GameCube and early N64. It seems that also lead developer, senior managing director and legend Shigera Miyamoto felt somehow unfamiliar during the “GameCube era”. He said:
“There was an era when Nintendo was going in the direction of doing the [...]
Read the rest » Vendor Management
Marketing and procurement 21:28:49: Finextra: ING launches pension peer comparison Web tool: http://bit.ly/lKc7w 21:26:00: There’s unacknowledged cross-over between marketing and procurement. INGs app shares common features with supplier comparison apps. Corporate sustainability reporting 22:01:14: Corporate Sustainability Reporting: The Executive Disconnect But there’s a major gap between understanding and action, according to a survey released this [...]
Read the rest » Contract Capital Management