A Study of Field Marketing Across Europe Part II - 5

A Study of Field Marketing Across Europe Part II - 5

Clients’ Influence on Field Marketing: How Bills Are Paid

KPI measurement has long since been in the tool box of Field Marketing agencies, not only as proof of success to clients (outsourcing has always need to document and proof ), but also for managing the performance of field staff at the point of sales.

While in sales and also in merchandising KPIs are pre-dominantly result-oriented (distribution, shelf-space, number of orders, size of orders, additional placements achieved) and measurable by quantitative and qualitative parameters, promotion and especially auditing are rather evaluated by operational KPIs (punctuality)4.

Comparing services: Sales Forces, as well as the so termed Other Services, have the highest share of performance based payments — for Sales Forces this in large parts is due to many clearly spelled quantitative parameters easily measured.

Localists-agencies on a local basis only—have a higher performance based ratio than agencies belonging to an international group or network.

Eastern Europe as well as Northern Europe do have considerably higher performance based ratios, than Western and Southern Europe.

Almost half (49%) of the participants see an increase in clients asking for more performance based payments. Demand from clients’ side in Eastern Europe is significantly higher than in all other territories, with 64% of clients asking.

Experience shows that in order to achieve long-term success a healthy balance between fixed and performance-based payment is a necessity. If the performance-based payment share is used to incentivize by measurable and swayable KPIs, instead of as a tool to outsource risks, sustainability of results have proven to be significantly higher.5

4 In case of classical sales promotions of course KPIs like products sold can be measured, in sampling or experiential number of people addressed, leads generated can become KPIs.
5 Aside from the increasing demand of performance based payment shares, RFIs/RFPs through the past couple of years have also demonstrated an increasing demand for ever longer extended terms of payment. And while 90 or 120 days might be feasible in case of storable raw material, the “commodity” of Field Marketing are trained people, who need to be paid weekly latest monthly.