• by Tom Hespos , December 2, 2003

Last week's column about AOL's recent move in the agency relations arena prompted quite a bit of feedback, both from readers and from AOL itself. Just before the Thanksgiving break, I had the opportunity to talk about the issue with AOL's executive vice president of interactive marketing Michael Barrett. Our main topic of discussion was the progress that AOL has made in working with agencies since the dot com boom, and what AOL will be doing going forward to continue that trend.

How does AOL perceive its relationship with agencies?

"I think we've done a decent job, through John [Messina]'s work, of addressing the agency community," said Barrett, citing an incredible increase in the number of advertising deals signed with agencies since the bubble burst.

But now that Messina is no longer working for AOL in his agency relations capacity, how will AOL continue to foster constructive dialogue with agencies?

"We're still not the easiest to do business with," said Barrett, but AOL has set a goal of being the easiest ad sales organization to work with. Barrett cited a number of pain points common in relationships between AOL and agencies that the AOL team is actively addressing. These include ad units and rich media, inventory concerns, long turnaround times for RFPs, and perhaps most importantly, paperwork.

Paperwork has long been a thorn in AOL's side. They have traditionally treated ad deals as long-form legal contracts, with lawyers getting involved more often than they probably should. The net effect of this approach was to greatly increase the time it took to formalize a relationship. Barrett said this is changing through adoption of the approach that has worked for traditional advertising agencies for decades - AOL is taking agency insertion orders.

"Going forward," said Barrett, "we'll take anything you send."

Barrett was quick to point out that this doesn't mean AOL will accept any terms that agencies throw AOL's way. It will reject or modify any terms that conflict with its agreement with subscribers. The IAB/AAAA Terms and Conditions are acceptable to AOL, with only a minor addendum.

Another identified pain point is inventory management. Agencies have often found that AOL's internal process for reserving and securing inventory can be a nightmare, with competition for inventory spanning across the sales force. Barrett said AOL is addressing this by putting sales planners in every office that will coordinate inventory issues with the New York office.

In discussing AOL's ongoing quest to improve relationships with agencies, Barrett cited progress with rich media, indicating that AOL's suite of accepted rich media types is now competitive with the offerings of other major online properties. He also pointed to AOL's loosening of restrictions on third-party ad servers. Whereas at one point in time, AOL didn't even accept third-party serving, now products from the major ad serving companies are acceptable.

Possibly the most significant change is how agency relations responsibilities will be absorbed by the AOL team. Senior-level AOL staff, including Barrett, Dick O'Hare, Charlie Barrett and Lisa Brown, will reach out to the agency community, representing AOL at industry events and industry-wide initiatives. Additionally, regional VPs are being empowered to deal with inventory, pricing and makegood issues. "It's like we've moved from one person to eleven people in agency relations," said Barrett.

Personally, I hope to see the effects of these changes in the near future. AOL's cutting of its agency relations position seems to be poorly timed, but if this decentralized approach to agency relations works, AOL could continue its slow but steady approach to rebuilding relations with ad agencies.