FIELD MARKETING LEAGUE TABLES 2000: Food products top use charts - Packaged goods continues to make the most use of field marketing, although other sectors are at last coming around to its advantages

Agencies are often reluctant to reveal the proportion of their revenue derived from particular business sectors. And understandably so, given that an agency is only likely to work for one brewer, one tobacco company or one detergent manufacturer, because of conflicts of interest. It wouldn’t take astute competitors long to work out the value of their most important contracts.

Agencies are often reluctant to reveal the proportion of their

revenue derived from particular business sectors. And understandably so,

given that an agency is only likely to work for one brewer, one tobacco

company or one detergent manufacturer, because of conflicts of interest.

It wouldn’t take astute competitors long to work out the value of their

most important contracts.



Fortunately, the vast majority of field marketing agencies have been

willing to provide this information in confidence, for aggregation by

Marketing. The companies providing the data account for almost 85% of

the industry’s turnover, as represented by the league table. Thus we can

say with some confidence that the chart above, while understating some

segments, presents a pretty accurate picture of who is using field

marketing.



It has also been possible this year to include comparable figures from

last year’s table. This shows very clearly the rapid expansion currently

being enjoyed by the industry, even allowing for the fact that there are

more participants this year.



Packaged goods is where field marketing originated, and this sector

still provides the bedrock for the industry. Food and confectionery,

alcohol, soft drinks, tobacco and other groceries, plus the work done

under contract to retailers and cash-and-carry outlets by their own

nominated agencies, account for at least pounds 137m of field marketing

expenditure. That compares with pounds 121m for all the other sectors

together.



But there are signs that different clients are catching up, as most of

the packaged goods segments, such as food and confectionery, alcohol and

tobacco, increased their spend by 25% to 30% over the past year.



That catch-all category, ’other grocery’, doubled its use of field

marketing.



CPM commercial director Mike Hughes points to Gillette as an example of

a client that has increased its spend with the agency in existing areas,

but also found additional money to target other channels.





Static figures



But expenditure by retailers and cash-and-carries with their retained

field marketers appears to have been largely static. This may reflect

the fact that the multiples are now more welcoming to suppliers’ field

marketers.



Growth rates are more spectacular elsewhere. The financial services

sector, for instance, appears to have quadrupled its involvement - up

from about pounds 3.6m to over pounds 15m. Some of this undoubtedly

reflects the huge premium collection contract Prudential has placed with

FMCG. But there is other evidence from around the industry.



SMC Field Marketing, for example, which was only founded in 1999,

secured American Express’ UK credit card acquisition programme last

summer, in a pitch against five other agencies. Since then it has

expanded its direct-selling activity by taking on work for Morgan

Stanley Dean Witter and Bank of Ireland.



Lloyds TSB has re-appointed CPM for what Hughes describes as ’some new

types of work’. But it has also added The Russell Organisation to its

list of suppliers.



The Russell Organisation is best known for specialising in the motor

industry. But managing director Rob Allen says: ’We now find

non-automotive clients are approaching us because they can see how our

experience can help them.’



And the motor industry itself - despite, or arguably because of, a very

competitive marketplace - has increased spend on field marketing by

about 45%. ’What is pleasing to us is that our automotive clients see

live and face-to-face programmes as being every bit as important to

their sales as, say, a major above-the-line campaign,’ adds Allen. ’For

high interest, high-ticket items, such as cars, consumers really want to

see, touch and feel the product.’



Field marketing, not the easiest discipline to define, is estimated to

account for just one-fifth of The Russell Organisation’s total

turnover.



The group is also active in areas such as sales promotion and

advertising, and through its partner agency, Teamworks Russell, is

probably the largest supplier of promotion staff to the Birmingham

International Motor Show.



This focus on the automotive sector, says Allen, ’ensures that any field

marketing programmes are a genuinely integral part of the overall

effort, and not a bolt-on to other promotional activities’.



McCann-Erickson’s subsidiary, Momentum on the Move, meanwhile, has been

working with Saab on a test-drive programme run through airports,

offices and the dealer network. ’The use of field marketing techniques

allows targeted customers to truly experience the brand, at the same

time helping Saab to build its database and develop a face-to-face

relationship with potential buyers,’ says Momentum chief executive Tracy

Lovatt.



Given the fiercely competitive market situations in conventional

telephone networks and mobile phones, home computers, utilities, and

home entertainment, from digital TV to videos and DVD, it is hardly

surprising that field marketing is very buoyant in all these sectors.

Two of them, utilities and entertainment, are analysed in greater detail

in separate articles later in the report (see pages 47 and 48).





Personal touch



Home calling has proven a very useful technique in both telecoms and

utilities. It seems there is a strong case for it, too, in home

computers.



After all, both loading a PC and getting to grips with its potential are

daunting tasks for the inexperienced.



’We have people going to customers’ homes, either to install or,

preferably, coach,’ says Richard Thompson, chairman of Mosaic Technology

and Communications.



The agency specialises in field marketing for high-tech clients, and has

established a Homecoach division.



’Things like how to access the internet, how to cut out stuff they don’t

want their children to see - these are extensions of what we are

providing in-store,’ he adds. ’The biggest challenge is that there is so

little margin, the vendors can’t provide the fee. It may be that it will

be part-supported by the internet service providers, because once you

have set someone up with e-mail and so on, they will be unlikely to want

to change their ISP.



’But we will only make money from this once it generates big volume.

When we can push the volumes up, it could be phenomenal.’



Business-to-business is the only area to show a substantial drop

year-on-year. But one of the problems here is definition. It seems that

a number of field marketing programmes in telecoms, utilities, IT and

the automotive sector, which began by targeting the consumer, are now

being extended into the business-to-business sector. It is probable that

they are being reported under those industry-specific headings, rather

than the more general one of business-to-business.



The chart above has been limited to the top 15 applications for field

marketing, but it’s worth noting that some of those that miss the cut

are still enjoying healthy growth, including travel, catering, DIY and

transport.



There are also grounds for thinking that travel is one of the sectors

that is under-reported, given that one of the companies that has

declined to provide an analysis of its turnover is known to be strong in

this area.



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