If you’re in any way associated with the marketing business, you’ve likely been aware of the unprecedented shift in the media business in the last few years.
No matter where you look, you can’t help noticing media has been undergoing a radical transformation – from the way it’s delivered, to who’s delivering it, how it’s planned, how it’s bought, how it’s sold, how it’s measured and how it’s really paid for.
Put another way, we’ve got a room full of proverbial elephants.
So, whether you’re an advertiser, media owner, media or advertising agency – media is a hot topic. And with billions of dollars at stake, you need to understand what the elephants are doing and what they mean for your business.
Here are five big pachyderms to think about:
Elephant #1: Programmatic Buying
The automation of buying and how the media business uses real time systems and algorithms to automate buying of media, has become a hot topic in and of itself. While programmatic buying technically cuts out a lot of manual work, there are any number of technologies (and companies) that take their fees or commission along the way.
Why it’s an issue: Ask yourself how hard your advertising dollars are really working? And how much of your total buy is really going towards the space you’re buying versus how much is being skimmed off before it actually gets there?
Elephant #2: Transparency
Simply put, marketers want transparency around how much their media agencies are paying for their media buys, coupled with verification their advertising has actually run when and where it was supposed to.
So, why is it an issue today? When a process is automated there’s going to be skepticism around whether programmatic buying is as accurate as marketers are told. The rise of technology in the media business has marketers asking more detailed (and uncomfortable) questions than ever before.
Elephant #3: Media Rebates
Since we’re on the subject of transparency, let’s acknowledge another elephant in the room: The alleged trend of media agencies subsiding fees through rebates, commissions or sometimes non-monetary incentives from media owners. And while marketers have often attempted to safeguard themselves through audits, this doesn’t always provide the transparency hoped for – a deeper discussion on media auditing can be found here.
Is this a new elephant? (Allegedly) no, not really. But with marketers squeezing budgets, reducing fees and commissions, and putting the media function under the microscope through their procurement teams, industry watchers will point to the need for “creative solutions” to maintain margins.
Elephant #4: Media Audience Measurement
When you couple programmatic buying and transparency questions, it’s logical that marketers are going to push for stronger, more robust methods of audience measurement.
Why’s it an issue: New media channels and a lack of robust ROI methodologies have fuelled a wide variety of measurement metrics across platforms. This lack of standardization only adds to the current media industry confusion and uncertainty.
Elephant #5: The Race to Zero
The downward pressure on media costs where agencies are remunerated on cost of planning or executing respective media buys rather than value, is causing a myriad of issues. Quality of resources and staffing retention being just two consequences that are diminishing value all round.
Is this new? No, I’ve written before on the Race to Zero, but marketers, media owners and agencies must quickly reach a consensus on how everyone can make a fair profit in this business before the business begins to implode. (And yes, I do think it’s that serious…)
Some will doubtless argue that the consolidation of media properties, big holding companies, media ownership or perhaps even Social Media giants like Google or Facebook are even bigger elephants to worry about.
However you choose to look at media, we’ve got a room full of pachyderms that need to be dealt with. Marketers, media owners and agencies need to work together to agree terms and create transparencies in their media contracts, while finding a threshold below (and above) which, elephants just aren’t allowed.
Which elephants are crowding your space? How do you propose to send the pachyderms packing from your business?