• by Christopher P. Batty , March 7, 2006

A growing number of rich media solutions providers have blossomed out of the ashes of the interactive advertising crash through both true innovation and savvy opportunism. A void in the market was created to a large extent by a failure of the large ad server incumbents to lead a necessary charge toward supporting more functional and dynamic creative executions. Arguably, the weakest element in the interactive advertising value chain was once the low quality of the creative on the Web. Indisputably, the wonderful creative these technology and service providers have enabled have made us all--marketers, agencies & publishers alike--much, much better off.

But there's something about the way these folks have inserted themselves between clients, agencies and publishers that is creating confusion in the market and wreaking workflow havoc in the media planning / buying process. The reasons why this is the case are less important than the problem itself and the way out of the woods--but suffice it to say I believe it has as much to do with a reluctance on the part of the major ad servers to offer an API where these applications could integrate, as it does the rich media solutions providers' near-universal decision to apply a CPM pricing model (and get between buyer and seller).

Rates for rich media services can vary substantially from agency to agency and even campaign to campaign. For all but the largest publishers who have an agreement (and the leverage) to steer business to one rich vendor or another in exchange for a consistent discounted rate, the market largely operates on each individual agency's negotiated rate-- basically a different rate for each IO a publisher signs. With hiring and turnover being what it is, often planners don't even know their agency's various rich media vendors' rates at first pass. Because creative planning and media planning decisions are very often being made in parallel, then which vendor will be used, to what extent and which placements specifically, are all moving targets.

As a result, many publishers have made a practice of additionally marking up media over and above the rich serving fee to compensate themselves for their extra time and effort. As a publisher, I happen to believe that it's crazy to penalize clients for investing in better creative--but having been burned a few times by mistakes on either our side or an agency partner; I do understand the inclination to do so. In response to this publisher tactic, agencies now often ask for rates twice--first for standard creative and then later again for rich media so they know they are not being marked up extra. And the games go on and on...

This is all aside from the issue of who will sign the rich media IO and make payment, and whether the fee should be bundled (read: hidden) or broken out in the plan.

The result is a fair amount of expense in time and errors made across the industry.

At the high end, these folks serve as extremely skilled, outsourced art directors. At the low end, they are the equivalent of creative production houses with an important (but proprietary) tracking & reporting capability.

Either way, there's no really good reason (tracking / reporting aside) for the industry that this transaction should live in the media department at the agency, let alone involve publisher ad sales.

Despite having an influential readership, Gawker scale doesn't afford me the leverage to do much of anything about it besides raise a flag to those who are in a position to address the issue. Large agencies and publishers who are losing significant time and expense do have the power to change the way they transact with these vendors if we make them aware of just how much of a hassle it has become. Perhaps more optimistically, one or more of the vendors, in a bid to gain share, might take steps to make doing business with them more straightforward and desirable.