Commentary

The Next Generation Audit

  • by , Op-Ed Contributor, October 2, 2020

Cut me open and I’ll bleed auditing. It’s a business I’ve worked in for 17 years. And despite that history at Ebiquity, PJL Media and now ID Comms Assurance I know that our industry needs to change radically.

Because if we don’t, we’ll become less relevant, less useful and ultimately less employed. Like the businesses we serve, we have been disrupted by digital and dramatic changes in consumer behavior.

There are a host of reasons that are driving change in our sector but the principle ones are that the product of traditional auditing is too dull and backward looking.

The next generation audit needs to be three things: It needs to be faster, smarter and actionable. In a media world that moves quicker than ever, relevance is the key to make sure that the audit reports actually make it to the CMO, that they actually inform the strategic advice that the media and marketing team feeds back to the strategists and planners.

That’s a radical change from what came before. When auditing was first introduced in the US we set out to demonstrate to our clients that we were serious people, providing a solid product.

The typical audit report delivery was also not a crowd-pleaser. Designed to impress with analysis quantity, it often made the audience think that the underlying remuneration model paid the audit firm by the slide. 

That approach continues to this day.

Another side of that culture is that auditing was isolated. Reports were developed and judgements were made with minimal dialogue with the agency. The auditor at arms-length, with limited time spent understanding campaign strategy or trying to engage those that planned and executed the buy, would provide a verdict on performance.

All of this has to change. To be relevant the next generation of auditing will have to provide three new elements for advertisers:

First, they will have to understand more about the underlying campaign strategies being audited. That means having a dialogue with the agencies involved based on mutual participation as well as a willingness to learn more, improve together and achieve competitive advantage for the advertiser.

Only then will the auditor be able to provide clear insights that are calibrated with a deep understanding of the objectives and strategies.

Second, they will have to extract meaning from the numbers. With apologies to Rishad Tobaccowala (Re-Inventing by @Rishad), “meaning from math” should be the goal of every audit. The data is not the insight and the ‘score’ is not particularly revealing (increasingly less so in a highly fragmented media landscape). The meaning must resonate so that relevant actions flow naturally.

Third, Next Gen audits need to simplify and focus only on the most meaningful insights and actions. We all know that less can be more and this has never been truer than in media performance analysis. The wisdom in the audit report is more likely to be actioned if the key points can be reduced to a single side of A4. The data behind those points should be available to analyze but we can no longer leave it to the client to work out what they should do with our numbers.

People simply have a comprehension limit and it gets pushed every day from a myriad of information sources. Our whole industry needs to simplify and focus for better understanding.

With the departure of Accenture Media from the auditing landscape many advertisers are reviewing their approach in this area. They can opt for more of the same, auditing as a tick box exercise, or they can think about what would make auditing relevant for 2020 and beyond.

 

4 comments about "The Next Generation Audit".
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  1. Ed Papazian from Media Dynamics Inc, October 2, 2020 at 10:39 a.m.

    I couldn't agree more, PJ. I've been involved on both sides in a number of "audits" and  without exception they were approached like an accounting exercise---"What's the normative CPM, how did we do? "etc. The campaign's overall communications goals and the sales that resulted were not part of any of the audits I saw---because they were all conceived as "media buying" audits. This was because the audits were executed without CMO or brand manager involvement to say nothingb of the agency account groups or media planners. Moreover, there was no attempt to audit the way the client's people performed in terms of giving the agency meaningful direction. What's needed are audits that evaluate as much of the commuunications strategy, how it was, planned,  developed and executed as possible regarding the media function---not just media buying.

  2. PJ Leary from ID Comms replied, October 2, 2020 at 10:56 a.m.

    Thanks, Ed. Part of the challenge is to make the audit output relevant, actionable and focused enough to gain CMO interest. This is a challenge we're up for but I do not pretend it's easy. The old saying 'I would've made it shorter but ran out of time' comes to mind. It takes time to focus on the 2, 3, 4 things that really matter to the CMO but that distillation process is what's required, in my view. Always appreciate reading your POV on industry matters / thanks for weighing in here.

  3. John Grono from GAP Research, October 5, 2020 at 5:23 p.m.

    In my experience, when media audits started in AU they were basically lowest CPM verification analyses and had very little to do with effectiveness and media strategy (of indeed the actual media implementation.

    In one instance back in tyhe '90s we had to intervene as the audit data being presented to the client was wrong.   Of course we had CPM software reports that were part of the diurnal process with us.   Fortunately the client listened and stopped the meeting, then kicked us both out and told us to sort it out.   Agency 1-0.

    Thank goodnjess for the developments over the past couple of decades.

    But I still struggle with the idea of an 'effectiveness audit' when so much of the focus is still on the buy.   I believe this is the realm of the marketer, rather than the media agency or the media auditor, as they are the only party with all the data to do the job in its entirety.   But is there the will?

  4. Ed Papazian from Media Dynamics Inc, October 5, 2020 at 6:51 p.m.

    John, I doubt that there is the will.

    While they won't say it for public consumption, most CMOs as well as higher ups at client companies simply can't envision "media" as anything but a cost per eyeball grinding operation. They believe that virtually the whole ball game is decided by brand positionning, creative execution, sales and promotional activities---and, of course, the quality of the product, its packaging, pricing, distribution, etc. Even if they saw things more objectively, most CMOs would be reluctant to hand a true advertising effectiveness  audit---as opposed to a media CPM audit--to an outside consulting group---no matter how qualified---as the "audit"---or evaluation---could connect all of the dots and zoom in on the client's folks who are neither skilled nor organized properly to maximize the effectiveness of the various elements---product development, positioning, creative, media planning, media buying, etc. The resulting "audit" would, in too many cases reveal failures on the client end---especially the brand managers and CMOs. Which is a powerful reason for them to kick everything under the rug and let the media bean counters have at it, chomping their CPMs. Why make trouble for yourself?

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