by Martin MacGregor (@MartMacG) There is only one question that every client should ask its media agency: “Is the advice you are giving me 100% right for my particular business problem?” The answer can only be yes if absolute neutrality sits at the heart of the decision-making process.
Hardly ever the case
Unfortunately for two reasons, one structural and one desperate and deceptive greed, this is hardly ever the case.
Structurally, media agencies have always been set up, both in terms of skill and revenue model, to service the paid-media needs of brands. There used to be much talk about media neutrality, but it is a now-meaningless concept when what brands really need now is touchpoint neutrality.
What does that mean? A solution that considers every consumer touchpoint and identifies the most-effective within the budget and target market constraints. If investing in the storefront window will work harder than a radio ad, so be it. In an agency structure where more paid-media means more revenue, this will never be the case.
More ominous
The second reason is a bit more ominous. As media agencies have compromised in justifying their value to clients and agreed to lower margins, they have looked elsewhere to make profits. Following the money, this had led them to the media owners and rebate or kickback deals dependent upon how much budget they can bring them across their client base.
This could potentially be seen as an innovative solution to a business problem. However, a veil of secrecy has been pulled over this murky part of the media business. Most clients are not aware of these deals and, if they are, are turning a blind eye. Why is this important? Neutrality most definitely gets thrown out the window when media selection is influenced by higher potential profit. This puts a massive question mark next to the advice of any media professional.
This problem became a big issue in the US last year and the Association of National Advertisers (ANA) has launched a massive investigation. And I’m starting to hear a lot of murmurings in the local industry as well.
Simple solution
The solution is simple: Separate media-buying from media-strategy and -planning. Media strategy and planning is a consultancy service based upon principles of neutrality. Separating it allows for a structure which considers all touchpoints, and is completely disconnected from any media-owner buying deals.
Media-buying has always seemed to be like the bank of the advertising industry and it really does operate like one. Its role is administrative and its specialist skill is in the detail of purchase and billing, volume negotiations plus the management of large sums of media investment. With this structure, clients can negotiate with each separate entity with full knowledge of what they are buying. And they can structure remuneration deals accordingly. Rebates and kickbacks in a context where they do not affect neutrality would be much more palatable.
There is much talk about the old agency models being broken and, globally, a sense of unhappiness from clients. Facing some hard truths and evolving smarter and fully transparent agency structures will go a long way to rebuilding trust — and clients paying properly for neutral advice which adds value to their business.
Martin MacGregor (@MartMacG) is managing director of Connect, an M&C Saatchi Company, with offices in Johannesburg and Cape Town. Martin has spent 18 years in the industry, and has previously worked at Ogilvy and was MD of MEC Nota Bene in Cape Town. He contributes the monthly “Media Redefined” column, in which he challenges norms in the media space, to MarkLives.com.
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