“In this corner… the
Association of National Advertisers (ANA) a heavy-weight known for its pummeling
attack. And in the opposite corner the
American Association of Advertising Agencies (4A’s) known for quick moves and ability
to dodge an opponents attack.”
Media transparency…
the issue which has shaken the advertising/media industry this year continues
to be a discussion vs. a solution. But
where to go from here? Is it the 4A’s of
ANA’s responsibility to solve the issue?
Or is it the client? What about
the agency? And how about the media
property?
Yes to all of the
above.
- Associations.
o The ANA and 4A’s should “attempt” to come up
with guidelines for both associations members.
o However, I don’t believe it’s possible that
they could ever come together with a single guideline document.
o Does this take the teeth out of each
organization? Not sure, but time will
tell.
- Clients.
o Need to clearly define any financial
compensation that the agency receives. This needs to include, but limited to, any
cash rebates, discounts, bonus inventory, barter rebate, agency fees, media
fees, etc.
o Next, clients need to clearly state what
happens with those rebates, fees, etc.
o Who has to approve all of these compensation
opportunities?
o It needs to be put in contract language in the
Master Services Agreement and applicable across any/all units within a holding
company.
o Get tighter control over tracking of media
spend and fees in general.
o Take a hard look at the compensation model you
have setup with your agency – perhaps you need to call off the Procurement
Dept. and actually put a bit more money in the agencies pockets.
o Consider putting specific contractual language
with your main media partners describing your expectations in regards to media
rebates, etc.
o Continuosly audit the agency.
- Agencies.
o Get over it.
You and the clients agreed that a 3rd party audit was needed. Now you didn’t agree to agree with the results,
but come on, the results are pretty clear.
Just move forward and fix the issues.
o Speak to your client about your compensation
challenges… if the rebates were providing the revenue you needed to meet your
financial targets then there’s a bigger issue.
Look most clients actually want you to make money. But if a client’s procurement department has
wacked away all your profit… it’s time to have a serious conversation with the
client.
o Don’t try to get squirm out of the issue with
interpretive analysis of legal documents put forth by clients.
o Be transparent – this is a chance to hit the “reset”
button on your client relationships if you work it correctly.
- Media Properties. Ahhhh, I didn’t forget about you! You’re part of the issue as well.
o Stop playing the victim in these conversations…
“I had to do it to get the business.”
o You need to be transparent with clients on the
full compensation picture – rebates, payments, discounts, etc.
o Make your rate card and prices more
transparent. Break down the costs so
clients can understand what they’re paying for.
o Stop playing both sides of the fence with the
agency and clients. Stop telling clients
how the agency isn’t fair and stop telling the agency the client loved the
idea. You’re feeding the issue.
The Dalai Lama had it
right when he said “A lack of transparency results in distrust and a deep sense
of insecurity”
See my previous posts
on this subject on my Linked page or on my blog.
Scott
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