From TCO to TVO: Why Marketing Procurement's Future Depends on Value, Visibility and Alignment

At this year's ProcureCon Marketing, one topic generated particular interest among procurement, marketing and agency leaders: how can marketing procurement move beyond cost control and demonstrate genuine strategic value?

For years, procurement success has largely been measured through a Total Cost of Ownership (TCO) lens, with a focus on savings, efficiencies and governance. Yet as marketing investment comes under increasing scrutiny, organisations are asking a broader question: What value does Procurement create beyond the costs it manages?

This shift towards Total Value Ownership (TVO) formed the basis of a panel discussion chaired by Ian Sullivan, Global New Business Director at Link Worldwide. The session explored how data, analytics, visibility and collaboration can help Procurement contribute more directly to both business growth and brand performance. Three interconnected themes emerged as critical to the future of marketing procurement: value creation, actionable visibility and stakeholder alignment.

What Does Value Really Mean?

One of the central questions raised was deceptively simple: What does Total Value Ownership mean in marketing procurement?

Despite widespread use of the term, there is still no universally accepted definition. However, there is growing agreement on what it is not. TVO is not simply another way of describing cost savings. Instead, it reflects a broader view of Procurement's contribution, encompassing factors such as marketing effectiveness, agency performance, innovation, speed to market and ultimately top-line business growth.

To truly influence brand growth, Procurement must evaluate agency partnerships not as fixed expenses to be minimised, but as strategic capabilities that amplify creative and market return.

This raises an important challenge. While many speak about strategic procurement, teams are frequently still measured primarily through traditional, savings-focused KPIs. A ProcureCon audience poll backed this up, revealing that 71% of respondents focus almost exclusively on cost savings for marketing procurement.

The panel of procurement practitioners highlighted the need for brands to drive greater value from the procurement process, while recognising that cost remains a primary driver. This largely stems from the traditional RFx process, which focuses heavily on commercial factors such as pricing, rates and cost savings.

Procurement teams are often constrained by a lack of data and analytics that would enable agencies to develop solutions aligned to the desired business outcome. Equally, agencies frequently argue that they do not receive sufficient data from brands to propose a substantial TVO solution.

As a result, the approach should transition away from a traditional cost-focused RFx model towards a more consultative TVO approach where collaboration between brand and agency plays a greater role, particularly where the necessary data is unavailable or incomplete.

Defining What Success Looks Like

If Marketing Procurement is to move beyond cost management and demonstrate strategic value, should the focus be on identifying better metrics, or on defining what effectiveness means for the organisation?

Effectiveness is not a one-size-fits-all metric. Every brand will define effectiveness differently depending on its priorities. For some organisations, sustainability may be a critical measure of success; for others, speed to market, quality or innovation may be more important. These are all factors that sit outside traditional cost-control metrics.

Ultimately, the effectiveness of an agency's products and services should be measured against the outcomes the brand values most. The challenge for procurement is therefore not simply gathering more data but ensuring that the right metrics are identified and aligned to the organisation's strategic objectives.

The shift from TCO to TVO also requires a rethink of how data is utilised. Many organisations are flooded with transactional data yet struggle to convert it into meaningful business value. The challenge is turning information into visibility, visibility into insight, and insight into action.

Agencies can only be expected to deliver against a brand's objectives if they have sufficient information to understand what success looks like. When data is limited or absent during the RFx process, it becomes difficult for agencies to propose solutions that are genuinely aligned to the desired business outcomes.

Where robust data is unavailable, consultation and collaboration become even more important. Rather than focusing solely on agency inputs, organisations should ensure there is sufficient dialogue to align on expectations, priorities and measures of success. Without that shared understanding, it becomes difficult for either side to demonstrate value beyond cost.

The Strongest Outcomes Come From Connected Partnerships

An emerging theme was that Procurement's ability to create value depends heavily on its relationships with both internal stakeholders and external partners. The strongest brand outcomes come from connected partnerships, not siloed functions.

One of the most revealing questions posed was: is there a disconnect between what marketing teams value and what procurement teams measure? Procurement teams typically measure success through metrics such as cost savings and budget adherence, yet these indicators reveal little about whether a campaign ultimately drove business growth.

The discussion identified that the most underutilised metrics are the links between marketing spend and actual business outcomes, specifically customer lifetime value (CLV) and incremental revenue. Incorporating these measures shifts the conversation from cost alone to value creation, enabling organisations to make decisions based not only on what marketing activities cost, but on the business impact they generate. This is the essence of a Total Value of Ownership (TVO) approach.

What Does a High-Performing Agency Look Like?

The role of agencies is also evolving. Discussions around transactional agency reviews, performance measurement and outcome-based remuneration highlight a broader shift away from traditional Supplier Relationship Management (SRM) towards collaborative, strategic partnerships, where value is measured by business outcomes rather than cost alone.

The high-performing agency will no longer be judged solely on creative output, but on its integration into this TVO framework. Success will be defined by how well the agency, marketing, and procurement functions align their data and objectives to drive measurable, long-term business growth.

Final Thoughts

If Procurement is to be recognised as a strategic contributor rather than simply a cost-management function, success will depend on three capabilities, that will be critical to the future of the function:

1. Value Creation – Marketing procurement must evolve from a cost controller to a value creator
2. Accurate Information – Data without visibility, alignment and action has very limited value
3. Stakeholder Alignment – The strongest brand outcomes come from connected partnerships and not siloed functions

The shift from TCO to TVO is not about abandoning cost discipline. Rather, it is about broadening the definition of value and creating a clearer link between procurement activity and business outcomes.

The future of marketing procurement will not be defined by what it saves alone. It will be defined by the value it helps create.

You can also view this article on Link's website and explore more of their content here.