Commentary

Exclusives Save Agencies Time and Money

There's been some confusion recently about what constitutes an exclusive relationship between an agency and a rich media vendor. By all logic, an exclusive deal should be simple. The agency should agree to work with just one rich media vendor, and the rich media vendor should in return agree to give that agency discounted pricing and additional customer support.

DoubleClick was the first company to aggressively pursue rich media exclusives. In January 2004, just months after DART Motif was launched, Starcom MediaVest Group (SMVG) named Motif its "preferred" rich media technology.

In other words, while SMVG isn't required to use Motif when building rich media, the firm receives incentives for recommending the tool to its clients. The next month, Austin-based agency GSD&M went a step further and named Motif its "exclusive" rich media vendor. More recently, both Unicast and Pointroll have started pushing agencies towards exclusive deals as well.

But apparently not all exclusives are created equal. As I reported last week on my blog, GSD&M still claims to have an "exclusive" relationship with Motif, but has also signed a "preferred" vendor relationship with Pointroll. How is that possible?

GSD&M says that all the rich media ads they build in-house will utilize Motif, and the agency receives a special price on those ads. But the agency also remains free to buy media space for any rich media technology. And when they buy media space for Pointroll, the agency will receive discounts of at least 25 percent. If it sounds like GSD&M is having it both ways, that's because they are. And good for them.

Clients know that I like rich media exclusives. These deals can save an agency money in several different ways. They agency saves money directly on the serving fees, of course, with vendors offering significant discounts - sometimes in excess of 50 percent - to get key shops to sign exclusives.

These relationships also improve an agency's efficiency. Because designers and traffickers no longer have to learn every tool in the industry, exclusives can save an agency time and money in both production and deployment, and also significantly reduce the errors that still plague rich media advertising.

Exclusives also offer an agency better access to the rich media firm. When an agency needs customer support, an exclusive deal may ensure a better and faster response from the vendor. In some cases, agencies with exclusive deals have a chance to participate in the rich media vendor's product development.

While I like exclusives, in the past I've cautioned agencies about the limitations inherent in these relationships because of my concerns. Not every agency will receive significantly reduced pricing from the rich media vendors; the more prestigious an agency, the larger the discount it will receive. And exclusives don't always allow for flexibility. Once an agency signs one of these deals, it's locked in for a long time.

But the market has proven these concerns wrong. Although GSD&M is a member of the Omnicom Group and handles advertising for Southwest Airlines and Wal-Mart, they're not a marquee name in our industry. Yet the firm got great deals from two leading rich media vendors. And despite the discount pricing, GSD&M obviously isn't "locked in" to any one rich media technology.

It has become increasingly clear that exclusive and preferred vendor relationships are a logical step for any agency. With vendors offering significant discounts and requiring almost no commitment, agencies have nothing to lose.

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