I am indebted to my ex-colleague Maarten Albarda (once of Coca-Cola and AB-Inbev) for posting the summary of a recent WFA survey of its members. The WFA, or World Federation of Advertisers is the global equivalent of ISBA in the UK, or the ANA in the USA. In other words it represents very large global advertisers whose views and opinions are (one would have hoped) of some relevance to the media agency community, given that where sophisticated advertisers go today the rest of the market will go tomorrow.<\/p>\n
The WFA study makes grim reading. 87% of their members are unhappy with the levels of transparency offered by agency trading desks; 54% said they had been asked to sign separate agreements with their agencies limiting (amongst other things) the right to audit performance; 57% were aware that the practice of arbitrage exists, with 82% of that group believing the practice negatively affects the agency\u2019s ability to act impartially.<\/p>\n
The WFA\u2019s own summary of the study concludes:<\/p>\n
\u201cThe central concern is that Agency Trading Desks offer a new way to charge more for the same product, that the price that is paid for an impression can bear no relation to the price the media owner charged for it.\u201d<\/i><\/p>\n
\u201cAdvertisers also fear that the ability of Agency Trading Desks to provide a new profit centre makes them vulnerable to making choices that are determined by the agency’s business interests rather than their client’s marketing goals.\u201d<\/i><\/p>\n
There are some interesting elements here. First \u2013 why shouldn\u2019t an agency ask clients to sign separate agreements regarding the services provided by the trading desks? No-one is forced to sign such an agreement presumably.<\/p>\n
Secondly, why shouldn\u2019t an agency look to make additional profits? After all advertisers are forever looking to maximise their profits; their shareholders would have something to say if that were not the case.<\/p>\n
But, and it\u2019s a very big but, the worrying thing about these findings is that clients are convinced they\u2019re being fleeced. They may<\/span> be OK about new agreements; they may<\/span> even be OK about paying more for additional services; but they are certainly not OK about anything perceived to be clandestine, or under-the-table, or somehow dodgy.<\/p>\n The Cog Blog has commented before that trading desks threaten the very future of media agencies. And yet at the same time at least some of them potentially offer a valuable service around their data analytics capabilities. The problem is first the name \u2013 whoever thought of calling a new service something so redolent of those nice, upright and morally respectable people in the City needs a severe talking to \u2013 and second the positioning.<\/p>\n That flapping sound you hear is chickens coming home to roost. For many years media agencies have focussed their efforts on the buying end of what they do. They\u2019ve cut their prices to win business, in the certain knowledge that they\u2019ll find a way to make up any shortfall. They\u2019ve failed to convince clients to pay for what we can shorthand as planning services.<\/p>\n Now that they have created a service potentially of value, particularly to data-rich clients they\u2019re being judged on their past record on transparency. It\u2019s no good them whingeing about how it\u2019s so unfair that they\u2019re not properly paid for their efforts. They need to reposition themselves to their clients by stressing the benefits they bring through their planning abilities before it\u2019s too late.<\/p>\n <\/p>\n <\/p>\n They need to walk the walk as well as talk the talk in order to become what they always say they want to be \u2013 the advertiser\u2019s trusted advisor. But first they need the trust bit.<\/p>\n","protected":false},"excerpt":{"rendered":" I am indebted to my ex-colleague Maarten Albarda (once of Coca-Cola and AB-Inbev) for posting the summary of a recent WFA survey of its members. The WFA, or World Federation of Advertisers is the global equivalent of ISBA in the UK, or the ANA in the USA. In other words it represents very large global […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/posts\/223"}],"collection":[{"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/comments?post=223"}],"version-history":[{"count":6,"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/posts\/223\/revisions"}],"predecessor-version":[{"id":229,"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/posts\/223\/revisions\/229"}],"wp:attachment":[{"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/media?parent=223"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/categories?post=223"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bjanda.com\/blog\/wp-json\/wp\/v2\/tags?post=223"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}