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Underlying truths behind the research

by Brad Aigner
November 26, 2013
in Advertising
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Underlying truths behind the research
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The MOST Awards survey has yielded rich insight into the dynamic tension that exists between buyers and sellers of media space. While there is little doubt that media owners and media agencies appreciate the importance of forging strong business relationships, in the context of service delivery each has continued to be critical of the other in the five years that the MOST Awards research has been conducted.

When asked in the MOST Awards 2013 survey for the media owners worst service traits, 214 of the 275 respondents had something to say. Media agencies’ primary criticisms of media owners relate to basic service delivery and knowledge of media. Many media agency respondents were critical of the slow turnaround time for media proposals, the lack of attention to detail and general unprofessionalism on the part of their media owner partners. In addition, the lack of media owners’ knowledge of their own brands in the context of the broader media landscape was a recurring theme in the research.

Effectively, respondents felt that while most media owner sales executives have a fairly good understanding of the brands they represent, they do not have a strong enough understanding of how their brands compete across other media categories. The lesson to media owners is that they should equip their sales teams with the knowledge to be able to engage with media agencies in conversations around the inter-media decision first and the intra-media decision thereafter.

The MOST data over the past five years shows that more media owners have been choosing to conduct business directly with advertisers, without bringing their media agency partners into the loop. Many agency respondents cited this as media owners’ worst media trait. The most frequent counter argument by media owner respondents was that their clients have disempowered media agencies and, therefore, the media decisions now rest in the hands of the advertisers. The implicit argument is that media agencies have regressed to the role of ‘media implementers’, contributing less to the strategic media decision-making for the brands they represent.

In the 2013 survey, respondents shared the worst traits by both media owners and agencies.

An agency respondent complained of media owners’ “consistent hounding when they know their medium is not relevant for your brand. Some reps have no knowledge of the brands you work on and they send you a generic proposal which has been sent to everyone in the industry”.

Another said, “Gifts – bribery service on a Friday. Can never get hold of them. Workshops. Always at a workshop…” And others said: “Long-winded cold call sales pitch that is aimed at their benefit and not considering whether the client is a good fit. Repeated sales calls to the same client with no recollection of what was discussed previously and rehashing same long-winded sales pitch… refus[ing] to hear that a title is off strategy; dropping rates to try and secure a deal which is clearly not on strategy; continually calling and wasting time; bring[ing] no value and no new information; dropping in unannounced and abusing the courtesy of media staff; setting up repeat visits with no information to share; approaching us with an air of desperation and panic; expressing personal anguish when not scheduled; berating the state of the industry; defaming their competitors.”

Alarmingly, 214 of the 275 media agency respondents were able to share a worst media owner trait in the survey. While the MOST Awards scores for many media owners have shown significant improvement over the past five years, it appears that professionalism is not yet at an acceptable level for all.

A review of the qualitative responses from media owners on worst traits from media agencies revealed that the lack of professionalism is two-sided. A media owner said, ”When asked for feedback, they are short and rude in response. Not giving media owners the opportunity to pop in to present updates and cancelling meetings last minute. Being unrealistic in expectation with respect to turn-around times. Planning schedules according to the options that will best benefit them (kickbacks).”

Media owners’ sentiment that media agency personnel are arrogant, disrespectful and condescending has been a consistent theme through the years. A media owner summed this up: “Some media agency people are full of a sense of entitlement. They treat us as though we are pond scum and that we shouldn’t breathe the same air that they do. We are not treated as equals. I think that it’s up to us as media owners to start treating ourselves with more respect by standing up for ourselves when someone is out of line. It is hard, though, as there is money on the line and certain media strategists are all about ego – they wouldn’t think twice about taking our media off the schedule.”

Despite this negative feedback, clearly some companies are getting it right. A review of the MOST Awards winners’ tables over the years shows that there are media owners and agencies that have consistently delivered strong levels of service and professionalism, forging strong relationships with their media agency and owner partners.

In almost every one of the last five MOST surveys conducted, the most important performance criterion expected by respondents (media agencies and media owners) was knowledge. However, reviewing the qualitative explanatory responses from respondents shows that knowledge needs to be considered in the context of experience. What is clear is that experienced people are most missed in many media agencies and media owner organisations.

The results over the years show that the most successful media agencies and media owners are those with stable sales teams and high profile, experienced leaders. There is no doubt that the loss of high profile, experienced employees by a business has a direct negative impact on the perception of that business’s ability. So, it is no coincidence that the incidence and growth of media consultants in the media industry in recent years has been significant. The challenge to media owners and media agencies alike is to keep their good staff.

In this year’s MOST Awards research, respondents (media agencies and media owners) were asked to give their view on the future of our media industry. Specifically, the question asked was: “It is a commonly held view that the current media agency business model is unsustainable. If you agree, are you able to suggest a future scenario that would see media agencies on a more secure footing within, say, the next decade? Please provide us with your comments.”

Overall, more respondents agreed that the current media agency model is unsustainable. A common theme from the research was the view that media agencies have allowed themselves to be commoditised in the industry. As a result, the value of their currency (media strategy and implementation) has been devalued. A respondent summed this up succinctly. “Unfortunately media agencies have created the very slippery slope they find themselves on. Discounting expertise and knowledge over the years to a level where margins are running at 2% to 3.5% isn’t sustainable; never was and never will be. It diluted media specialist knowledge and expertise to a discounted trading commodity.”

A commonly perceived cause of this situation has been the willingness by some media agencies to provide their service for paltry fees. In support of this view, one respondent stated: “Both media agencies and marketing teams need to start placing real value on the work done by media professionals. It has become the norm for clients to expect more and more from their media teams, while thinking that they can pay the same or less year on year. Media agencies often accept this as they are terrified of losing clients to the ‘next cheapest option’, but it results in the media teams paying a huge personal cost that is not sustainable.

Perhaps the concept of media commission is outdated, and a resource-based fee is the way to go?”

Another respondent indicated that this is a worldwide problem and is not exclusive to South Africa. His argument reasoned that while most other professions of a specialised nature (for example, medical, legal, advertising) commanded and received generous remuneration for all services offered to their clients, media agencies have done themselves a disservice by competing on price rather than expertise. He concluded with the observation that no implicit value to cost benchmark has been set by media agencies in South Africa and suggested that a degree of solidarity between media agencies might be a catalyst for a more sustainable future.

Another recurring theme relating to the question on the sustainability of the traditional media agency business model in South Africa was the thought that independent media agencies should transform themselves into full-service agencies that offer turnkey solutions. Some reasoned that this transformation could be effected by independent media agencies merging with creative agencies (again), while others suggested that media independents should develop a service offering that is more closely involved with the development of the creative product, with some going as far to suggest that media agencies should develop their own creative departments.

Irrespective of the direction that media agencies choose to go in terms of safeguarding their future existence, as with any business in any industry, the prerequisites are to be able to offer a relevant service to clients and to have people competent to deliver that service.

Insights from the MOST Awards research suggest that the winds of change are blowing stronger in an environment that has traditionally been resistant. Already market forces have been at play with the influx of independent media consultants and the integration of media departments as a self-resourced function in corporates. Whether the momentum gathers into complete industry transformation or just a slight shift in balance only time will tell. But we don’t have long to wait now…  n

Brad Aigner is MD of Freshly Ground Insights, the company that conducted the MOST Awards research.

• Times Media Group sponsored a breakfast where Aigner explained some of this information.

 

Tags: Brad AignerFreshly Ground Insightsmedia agenciesmedia ownersMOST researchTMG

Brad Aigner

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