GroupM's Norman Takes ANA To Task: Cites Omissions, Inaccuracies In Transparency Report

GroupM Chief Digital Officer Rob Norman took the ANA to task for its media-buying practices report issued last week in a blog post issued today, which is being posted on outlets including Mediavillage.com and both Norman’s and GroupM’s LinkedIn pages, as well as on GroupM.com. 

The report, Norman wrote, failed to note the significant investments made by agencies in the technology and data sectors to keep up with the growing complexity within the media landscape -- and the added value such investments have produced for advertisers. 

While advertisers continue to squeeze agencies on price via their procurement efforts as the ANA report notes, Norman stated that the study “omits acknowledgement that in spite of such pressure media services companies play an important role in supporting clients through a time of technology enabled radical change in consumer behavior and media consumption.” 

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Agencies have saved their clients millions with effective steps taken in the areas of verification, viewability, anti-fraud, anti-piracy and consumer privacy measures, Norman notes/ “Our contribution, and that of our peers” to these efforts have “been entirely overlooked in the ANA report.” 

Norman also challenged the report’s assessment of principal trading models and wrote that instead of dismissing such models as non-transparent ways to leverage client volume, they should be seen for what they are: models based on supply-and-demand dynamics that benefit advertisers and agencies alike and with some risk to the latter. “It is our right to assume our own risks to the benefit of our own business especially when they only reward us if they reward the advertiser.” 

Here’s the full blog posting: 

The ANA Report – Addressing complexity is a complex issue

Rob Norman: Chief Digital Officer GroupM Worldwide, Chairman GroupM North America 

The changing media environment has raised client expectations of agency technology capability to a level that is unrecognizable from a decade ago. Yet (perhaps unsurprisingly) nowhere in the ANA US Transparency Report, nor likely in the upcoming guidelines, is a positive reference made to either the increasing complexity of the US media market or the investments in technology, data and human expertise made by media services companies and their parent companies in response. 

The report acknowledges the pricing pressures imposed on agencies by clients and their procurement offices. However, it omits acknowledgement that in spite of such pressure media services companies play an important role in supporting clients through a time of technology enabled radical change in consumer behavior and media consumption. 

This includes the development of the highest possible standards of verification, viewability, anti-fraud, anti-piracy and consumer privacy measures. These have promoted integrity in the digital supply chain and protected advertiser investments and reputations. In our estimation this has saved advertisers many millions of dollars. Our contribution, and that of our peers, to this process has been entirely overlooked in the ANA report. 

In response companies like ours have made, and continue to make, real and necessary investments, in order to effectively plan and trade new markets and provide seller agnostic solutions for our clients who, as the report points out, value vendor neutrality. 

The evidence of our actual technology investments is significant: 

  • WPP’s acquisition of 24/7 Real Media in 2007
  • The subsequent creation of Xaxis and its buy side DMP Turbine. The more recent acquisition by Xaxis of ActionX for cross screen targeting and mobile commerce and the creation of Light Reaction which is compensated solely on the outcomes created.
  • WPP’s 2015 acquisition of Medialets and its mobile adserving and attribution capabilities that create an alternative to the walled gardens of the media technology giants.
  • Our acquisition of The Exchange Lab in 2016 which via their solution Proteus offers access to almost all sources of programmatically traded digital inventory.
  • Our minority investment in AppNexus; the world’s leading programmable advertising platform.
  • The development of the Zipline DMP by KBMG, a sister WPP company.
  • The creation of Modi Media, the U.S. leader in addressable television. 

These investments enable us to apply data and technology to the purchase of inventory. The addition of data, tech and analysis transforms the nature of the underlying commodity by turning billions of impressions into relevant and valuable audiences. 

This is a new class of media asset. We offer this new asset to clients in two ways. The first way is at a high level of service pricing with as much underlying disclosure of costs at the vendor level as possible; many clients choose this. Alternatively, we offer advertisers guaranteed pricing for a given objective, bundling all costs of data, media, tech and service. This is a principal trading model. As we have repeatedly stated this requires an opt-in, is subject to constant performance review and in no way depends on leveraging the spend of advertisers who do not opt in as we are leveraging technology and data not volume of advertiser spend. 

In either approach to working with us, the client enjoys the same GroupM standards of viewability and verification which we’ve set at bars surpassing industry norms.  We continue to win client business against traditional and new competitors with both models because we create competitive advantage for advertisers. 

It is our perspective that advertisers and their advisors should take a value-centric point of view around principal media trading models in digital and other media. These models are developed on the basis of marketplace insights into supply and demand dynamics and not the leverage of client volumes. The ANA Report does not concede that this is possible and inaccurately suggests such models must be at the compromise of value due to clients. Media service companies accept many risks including intellectual property liability on behalf of clients. In turn it is our right to assume our own risks to the benefit of our own business especially when they only reward us if they reward the advertiser. 

The ANA report seems to suggest that there is something wrong with agencies being rewarded for these investments and acceptance of risk.  

In no way do we expect advertisers to participate blindly. It is the agency’s clear responsibility to demonstrate both value and the lack of harm caused by creating that value. We hope that the Ebiquity-authored guidelines take a balanced view of this issue. Of course they should encourage vigilance; of course they should encourage clients to be satisfied that these business models are delivering value. What they should ensure is that the guidelines do not have the effect of reducing investment in ‘fit for market’ technology and ultimately disadvantaging advertisers in the name of transparency. It seems that such a balanced approach is in keeping with the stated business purpose of auditors and consultants collaborating with the ANA who are focused on helping advertisers achieve business success in changing times. That’s a great goal and one we share.

7 comments about "GroupM's Norman Takes ANA To Task: Cites Omissions, Inaccuracies In Transparency Report".
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  1. Ed Papazian from Media Dynamics, June 14, 2016 at 10:48 a.m.

    It seems to me that Rob raises some fair points. Indeed, as I mull over the ANA's report and the various, almost predictable responses to it, I have the distinct impression of this being a case where the ANA bit off more than it could chew. Which is not to absolve those agencies who may have been engaged in shoddy practices regarding media placements, hidden fees, etc. Nor to absolve many clients who probably knew about this but didn't care---until someone spilled the beans. However, if the ANA realized that it couldn't supply specifics but was basing its "investigation" on confidentail interviews with various parties of interest, perhaps it should have reconsidered the tone of the report, which suggests industry wide and "pervaisive" malfeasence on the part of "agencies".

  2. Dina Bloch from Huffington Post, June 14, 2016 at 10:52 a.m.

    Bravo! This entire report is ridiculous. Brought about by the comments of a highly imperfect person who feels left out.
    Agencies today do a great deal under a much higher level of scrutiny.  Putting this system under another microscope is just detrimental to the entire system and looking to give a black eye where none is needed.

  3. cara marcano from reporte hispano, June 14, 2016 at 11:22 a.m.

    This is crazy, this use by this holding company of Xaxis as a defense for bot fraud? 
    There are billions of dollars wasted by this agency buying their own "media" - which is what exactly? It is almost all robot eye balls. Why don't you guys push them on what exactly this tech and "programmatic" is actually buying or why the dollars spent with WPP never actually buy any media not owned by WPP other than Xaxis. What is Xaxis exactly? What consumers does Xaxis get the clients' message or media in front of?

  4. Justin Farber from AKQA replied, June 14, 2016 at 12:55 p.m.

    "why the dollars spent with WPP never actually buy any media not owned by WPP other than Xaxis."
    Except that WPP-owned agencies do actually though. Cara, what are you talking about?

  5. Doug Garnett from Protonik, LLC, June 14, 2016 at 6:32 p.m.

    I'm struck that the issue of outright fraud is far less than the issue of abuse of client trust. Perhaps the issue we should all consider is how well our agencies balance the trade off of looking after our own bottom line vs. looking after the client bottom line.


    Truth is, agencies increase their bottom lines by procuring large blocks of media. It's a huge issue in direct response telelvision. It is at least a significant issue in general TV media from what I read.

    That puts big pressure on the agency to ensure that they sell all that time - whether it is useful for their clients or not. In fact, I've looked at a lot of schedules where time is included that is borderline (not horrific) but only included because the agency owns it.


    Perhaps the reality is that industry problems are hard to detect. But we should begin to.


    I wrote this blog post after a letter was published by a resigning Goldman-Sachs employee - noting that he felt they'd stopped making decisions for the investors good and has begun making all their decisions based on what was best for Goldman. http://atomicdirect.com/blog/communication/do-ad-agencies-serve-clients-or-their-own-bottom-line-its-tricky/


    In the ad biz, it's exceptionally easy to cross the line...the creative pushing preferring ideas that build their portfolio to the ideas that are best for the client...the media team pushing media they own...research departments doing boilerplate research "because"...selling digital because it's an easy sell NOT because it's effective for the client.

  6. Ed Papazian from Media Dynamics Inc, June 14, 2016 at 7:53 p.m.

    Doug, unless things have changed an awful lot, a typical ad agency buys traditional media to fulfill a media plan approved by a client. In the case of network TV this may call for a certain estimated number of GRPs in certian types of shows or networks by daypart, season, etc. However when a specific buy is authorized---say for a primetime schedule on CBs, specific shows and telecast dates, as well as the total cost are listed. The agency is acting in behalf of the client, it's not buying the time for itself, then unloading it on any client who will take it at a price that's different from the actual deal. The same goes for other media---radio, magazines, etc.

    Where the confusion lies is the contention that in some of the huge upfront corporate TV buys, the agency garners an advantageous combined CPM guarantee for all of its clients together---based of the total volume of their dollars.  Late,r individual buys are made client by client, but this gives the seller involved an undue edge as it knows that the agency must deliver the volume to earn the agreed total CPM. Consequently, some clients may not get as favorable treatment as they might have without being part of the bigger deal. It is also alleged that even if the agency satisfies all of its client's needs at the average CPM that is agreed on, it may retain some additional, unallocated, audience tonnage which can be sold for its profit to other parties. This is where the transparency issue arises. Some clients may say that it was their money that enabled the agency to make this extra profit. Why not give it back? The agencies may say that without their pooled all-client clout---which takes extra time and effort to organize--- the average client would not have fared so well and, accordingly, they deserve what amounts to an added fee. As you can see, it's a very complicated issue with fair points to be raised by both sides.

  7. Doug Garnett from Protonik, LLC replied, June 15, 2016 at 1:34 a.m.

    Thanks for the clarification, Ed. In DRTV, agencies will buy blocks to use for their clients or resell in brokered time. It's a commitment to specific time. But generally there is no transparency - clients don't often know it's happening.

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