Advertisers Dropped The Ball On Media

A year ago, the US was still in denial. Many advertisers did not believe that media rebates existed. They have now received a violent wake up call. 

What many have alleged over the years has now become accepted fact thanks to the ANA and K2 Intelligence. We now know that some media agencies have not been acting wholly in the best interests of advertisers. 

One reason for this is that agency business models are complex and confusing. Part of that problem is that media agencies do not always clearly differentiate between the different types of service they offer and whether they are acting as agent or principal. 

But perhaps the biggest thing that we’ve learnt is that brands share a huge chunk of the responsibility for allowing this state of affairs to develop. 

Put simply, media was not high enough on the corporate agenda when the scale of investment was taken into account. 

Companies developed an attitude that it was acceptable to spend hundreds of millions of company marketing dollars by simply handing over the responsibility to their media agencies. 



The bottom line is that some advertisers became too trusting of their agencies. They gave up control and decision making power and didn’t understand the complexity and risks of the media process. 

Their lack of oversight on media investments allowed agencies to operate without accountability and abuse clients’ trust. 

The key reason that they had to do this is because at too many companies internal media capability has been so poor. 

So if that’s what we’ve learnt, here’s what brands should do about it: 

First step is to invest in implementing better governance over their media investments. This involves having sufficient talent internally as well as a commitment to continuous improvement through a program of training. 

The second step is to update their contracts with agencies. Right now these have far too many loopholes. It’s now simple to upgrade the contract language thanks to the template that the ANA has developed – with credit to ISBA in the UK. But actually implementing the upgraded contract is far harder and creating the right climate for re-negotiation will be the biggest challenge for most advertisers now. 

The third step is to ensure clear processes are in place on how the brand works with agencies and that there is a robust program of agency performance evaluation to keep all partners accountable. 

Delivering all this requires both a mandate from the board and internal leadership. The Chief Media Officer role, as recommended by the ANA, needs to make a welcome comeback, providing not just corporate leadership and accountability for the large investment but also developing a manifesto for the role of media within the company. This needs to detail how media can deliver growth for the company and will be bespoke to each sector. 

A year on, brands must invest in the knowledge and tools to make their media agency a trusted partner once again. 

What every marketer needs to consider is a plan for change. It has to be a plan that recognizes the new reality, the existence of rebates, non-transparent practices and the complexity of the agency model. Most importantly it has to commit the marketer to a change of behavior. 

This will be a journey to a better agency relationship. One that ensures media delivers for the business, with the tools in place to monitor performance. 

Inertia will simply lead to disadvantage.


2 comments about "Advertisers Dropped The Ball On Media".
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  1. Ed Papazian from Media Dynamics, July 25, 2016 at 9:23 a.m.

    As I have noted in other posts and venues, I heartily agree about the need for advertisers to not only upgrade their own media departments but also to empower them so they're no longer under the jusirdiction of the brand groups. Aside from policing media buys and seeing media reps, this must include the ability to challenge the brands' basic media planning assumptions and the almost total lack of consideration of alternative media mixes. Frankly, I doubt that we will see this particular part of the ANA recommendation take root as boring, numbers-driven  "media" is not going to be recognized as a full partner in the advertising process at many "clients"----or, to be honest, at many agencies. Moreover, few marketing directors are going to tolerate challenges of their authority to dictate media mixes---and that is what actually happens----based on their particuar sets of wisdom or lack of knowledge, to a CMO who snitches on them to the top brass and causes problems. After all their media budgets are "their dollars"---aren't they?Sad!

  2. Tom Denford from ID Comms Inc, July 25, 2016 at 10:05 a.m.

    Agree Ed, but I'm perhaps a fraction more optimistic! Sure there will always be a bunch of advertisers for whom media is a cost to be managed downwards (cut) usually with the agency having to accept the scalpel. But I think that smarter brands are seeing that, long-term, this strategy doesnt actually sell more cars or more soap, it just buys more media, more cheaply. So that KPI has to evolve and media investment held to a higher standard to drive a meaningful business metric for the company. Those marketers who don't recognize the potential in their media spend to work 3x harder than it does right now will be at a disadvantage (this year) and then displaced by someone who does and can do their job better (next year). 

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