SUPPLEMENT: FIELD MARKETING; Welcome to the big time

Our first-ever league table for the field marketing industry reveals an encouraging picture of growing turnover and buoyant trading conditions, writes Ken Gofton

Our first-ever league table for the field marketing industry reveals an

encouraging picture of growing turnover and buoyant trading conditions,

writes Ken Gofton



The first-ever field marketing league table reveals an industry which

added almost 22% to its turnover between 1994 and 1995, taking it from

just under pounds 94m to pounds 114m. Most companies report buoyant

trading conditions - a mix of existing clients spending more and new

sectors, such as electronic games and utilities, opening up.



‘Clients who rationalised their staff during the recession are having to

turn to field-marketing specialists,’ explains David Carter, managing

director of Merchandising Sales Force. ‘The industry has benefited.’



Heading the table is the country’s oldest field-marketing company,

Omnicom offshoot CPM International, with a UK turnover of pounds 39.6m -

more than twice the size of its nearest competitors, Aspen and FMCG. And

this is without counting a further pounds 23m of field-marketing

business in the hands of CPM’s sister companies in Europe.



A quick history lesson is appropriate here, however. The move that put

CPM into its dominant position occurred in 1988, when its parent, ad

agency BMP (now part of the Omnicom group), bought TMG and merged the

two. TMG had been started by ex-Mars manager Mike Cottman and held the

Mars account, and Mars is arguably the UK’s largest and most consistent

user of field marketing. That business moved into CPM and has stayed

there ever since.



Cottman, meanwhile, had made it clear that he wanted to run his own

show, and one year later he left to launch FMCG, standing in this case

for Field Marketing and Consulting Group. ‘That’s why you have two of

the largest field-marketing companies in the country within an arrow’s

shot of each other in Oxfordshire,’ he points out.



Aspen Field Marketing, part of the Aspen Communications Group, just pips

FMCG into second place. But it’s close - pounds 14.7m against pounds

14.6m, if you count FMCG’s pounds 600,000 of work in Ireland.



Next comes Ellert Retail Operation Services. You might think it had won

the lottery, given its near-40% jump in turnover last year (indeed,

Camelot is one of its major clients), but most of that growth came from

existing blue-chip customers. However, chairman and managing director

Rob Ellert is realistic enough to acknowledge that budgets fluctuate.

The important thing, he says, is to be big enough to have ‘critical

mass’.



As Nick Fennell, CPM’s new business director, points out, the old

‘conflict of interest’ argument tends to mean that each of the biggest

players has one confectionery client, one drinks client, one crisps

client and one tobacco client. For example, CPM has Mars, Aspen has

Nestle Rowntree, and FMCG has Cadbury.



These clients are major players with major budgets, which tends to

reinforce the stature of the field-marketing companies at the top table.

Sometimes, a few crumbs escape, however. Teamwork Field Marketing, a new

division within the York-based TML group, has recently been awarded some

‘ex-car’ work from Nestle Rowntree, for example. Effectively, ‘ex-car’

means picking up car-loads of brands on promotion - such as the special

US-version Fruit Pastilles - from depots or cash-and-carries and selling

them from the car to independent retailers for cash.



‘This is totally different from Aspen’s work for the company, which is

contract merchandising,’ says Teamwork’s commercial director, Bobby

Collins. ‘We are just selling in special promotions, literally selling.

But this is quite big news for the industry, because it represents

Nestle returning to an activity it had dropped.



‘Like most large companies, it has concentrated on the national

accounts. This is a return to grass roots. The independent sector is

equivalent in size to Asda, and if you are looking to increase your

market share, that is where it has to come from.’



Another significant piece of news this summer has been GSD’s acquisition

of Praiseworthy Personality Marketing (PPM). Chairman and managing

director Robert Gill says the deal takes the group into two new sectors:

the DIY sheds and greetings cards. The latter, although a niche market,

is particularly interesting, because it is a syndicated service for

around 50 clients, ‘a very cost-effective way for small manufacturers to

get into retailers such as WH Smith, Boots and Menzies’, says Gill.



‘Sharing costs is a wonderful goal, but the problem has always been

persuading clients that they are getting their full share of voice,’ he

adds. ‘PPM cracked it.’



A new company that appears to be impressing its rivals is Headcount,

which has built itself up to a pounds 3.4m turnover from a standing

start two years ago, with the backing of specialist ad agency Milton

Marketing. Its managing director Mike Garnham, formerly a director at

FMCG, explains: ‘The conversation began on the golf course, as these

things often do. Les Milton specialises in health care and he was aware

of client companies developing OTC products without a sales force to

support them.



‘That’s why we set the business up. Pharmacy is an interesting niche,

although it only accounts for 10% of our turnover now. Our primary focus

has to be where the biggest part of the market is - that is, food and

drink.’



The report has been compiled in a similar way to Marketing’s other

league tables. Questionnaires were sent out to companies in the industry

asking participants to provide supporting evidence of their turnover

figures in the form of an annual report, auditors’ certificate, or

management accounts.



One question which proved tricky in an industry where there is so much

part-time employment related to staffing. There was no difficulty about

head office numbers, the problem was identifying the numbers of

employees ‘in the field’.



Most companies have a relatively small number of full-time regional

supervisors, plus a large database of people they can call on running to

several thousand (and who might work for several different companies).

We decided that the appropriate definition, if a little imprecise, was

‘people who work regularly for the company, whether they are full time

or part time’.



On staff numbers, it should also be borne in mind that work in the

industry tends to be split between contract or strategic and tactical.

As a generalisation, contract work - such as servicing the country’s

57,000 CTNs - requires greater staff numbers than mounting a series of

road shows.



The truth is that field marketing covers quite a lot of activities:

merchandising, to ensure racks are filled; auditing, to ensure retailers

keep their promises on display space and to check competitors’ price

moves; in-store demonstrations and roadshows; sampling and mystery

shopping; crisis management and product recalls; and replacing stock in

old packs with new designs. In one case, says GSD’s Gill, a product’s

bar code wasn’t scanning properly and a team was sent out to stick new

labels over the top.



As well as all this, speedy and accurate data collection is becoming

increasingly important, leading to field-force operatives being armed

with laptop and palmtop computers.



And training - not only must field forces be well-trained about the

brands they represent, several companies report that they are being

asked more and more to train retail staff, or even the staff in their

clients’ companies.



‘In games software and in white goods, our teams will call at the

outlets and give training on the products,’ says Aspen’s business

development director Gary MacManus. ‘The reason is, people tend to sell

the products they are comfortable with, and our clients would like to

increase that feeling of comfort by training retail assistants on the

spot. We want the products to be top of mind.’



It has been our experience over the years that league tables start small

and grow as agencies come to appreciate the importance of being

included. But participation is voluntary.



In the case of field marketing, we began with a longer list, but a few

companies felt that they were too small, others that they did not want

to reveal their figures (which might be the same thing). One or two

thought they might participate next year, while others were promising

data right up to the final deadline.



The size argument is not easy to understand. It is just not true that

big companies will only use big suppliers. For example, the two smallest

companies in this year’s league are both relatively new start-ups:

Retail Field Marketing has done work for Britvic, Scottish Courage and

Holsten; and Teamwork has worked for Nestle Rowntree, Spillers and

Procter & Gamble. You can’t do much better than that.



Do clients take it seriously?



One company missing from this year’s table is Logobrand, which is active

in areas such as mystery shopping, auditing and merchandising. It wants

a new way of describing what it does. Peter Burke, its managing

director, says: ‘We desperately want an appropriate tag, but I am

equally certain that ‘field marketing’ is not it.



‘The big problem is that most people don’t take the industry seriously.

They still think it is women in T-shirts on motorbikes, giving out kiwi

fruit.



‘It is a valuable service, but we need something like a road sign - a

woman in a T-shirt with a line through saying ‘No girlies here’.’



Rob Ellert, chairman and managing director of Ellert Retail Operation

Services, has some sympathy for that viewpoint. The services his company

provides for Procter & Gamble, BT and Bass are completely different, but

all come under the umbrella term of field marketing.



In any case, he believes that the market will polarise in the next few

years, with the highly accountable, carefully measured approach of P&G

at one extreme and the ‘make a visit, tick a box’ approach at the other

- where the emphasis is on the number of calls made, rather than their

quality or effectiveness.



Who uses field marketing?



Food manufacturers emerge in our research as the dominant users of field

marketing, accounting for about a third of the total.



But the figures can only be a rough guide to the big spenders. They

provide a reasonable indication to orders of magnitude, but understate

the totals, because of the business in the hands of non-participants. No

allowance has been made for the activities of two prominent players:

FMCG - which declined to provide an analysis of turnover, and whose

clients include Cadbury, Golden Wonder, and Rothmans (UK); and CBA,

which works for Allied Domecq, among others.



------------------------------------------------------------------------

Who uses field marketing?

------------------------------------------------------------------------

Sector Spend (pounds m)

Food manufacturers 34.0

Retailers 15.0

Drink (alcoholic and soft) 12.0

Business-to-business 11.0

Home entertainment 5.0

Tobacco 4.5

Financial services 3.5

High-tech 3.5

------------------------------------------------------------------------



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