It is increasingly common to be asked to look at production costs for television commercials that will never be seen on television. Well not unless the television is an Internet smart-television and the viewer is watching YouTube. But the reason I refer to it as a television commercial is that it looks like a commercial, sounds like a commercial and could very easily be a television commercial if the client would not stop referring to it as an online video.
Is it just me or is production the next hot topic after media transparency and data security when it comes to marketing? There is not a day goes by when there is not a new article, podcast or story on advertising production and the issues, innovations and ideas on the best way to implement and manage production in the ‘digital age’. While I recognise the irony of me writing this, TrinityP3 has been observing, commentating and benchmarking advertising production for almost two decades and we have seen the trends come and go.
Justin Ricketts is the CEO of Hogarth Australia and recently shared his thoughts on the media and creative agencies recombining, while still recommending that the resultant production should be decoupled. While decoupling production has been common in the UK for decades it is still a hot topic in many markets and he discusses the benefits and the challenges of getting it right.
Harry Preston is the Managing Director A/NZ of Genero, a technology platform for more than 300,000 film and video creators, connecting this community with advertisers, marketers and their agencies. Here Harry discusses the innovations occurring in the industry and how technology is making high quality productions faster, more accessible and lower cost.
Last year the ANA responded to the investigation by the Department of Justice into Agency production practices and included this in their call for greater transparency in advertiser and agency relationships. The concern was that agencies and especially the Holding Companies that own the agency groups, were competitively tendering for advertiser commercial productions against the independent production companies in an unfair and biased manner.
In this episode, Darren Woolley is joined by the managing director of The Genero, Harry Preston. We discuss: What impact has technology had on film and video production? How has the rise of content changes production options for marketers? Is the concept of Quality Cost…
Recently I received an email from an “Institute” claiming that they were researching the current state of the global TVC production industry.
They said that they had read several of my posts on the TrinityP3 site and considered me to be an expert on the international TVC production industry. Of course, I was extremely flattered to be labeled as an industry expert. The email then went on to propose that I forward my insights to them so that they could incorporate them into their “white paper” on the global production industry as it now stands.
It did not take long for the penny to drop (having a healthy cynicism is one of the most important traits a production expert should have). Of course the “Institute” would use my insights and re-brand them as their own, passing themselves off as industry experts and perhaps even make an income from their new-found expertise without doing the hard yards, many years of hands-on experience and constant monitoring of the industry. So I declined their kind invitation to share my specialist knowledge with them, instead to continue to share it here with you.
The state of the television production industry
But their invitation did make me think that the current state of the TVC production industry is one of confusion, mistrust, and fear, in fact this could be said about the advertising industry in general. I will keep my generalisations to TV production and television as an advertising media.
This confusion is partly driven by the impact of technology on the advertising industry and particularly the production industry. The cost of entry into the production arena has dropped as digital technology has made production equipment and the process more cost-effective. In fact, it is so cost-effective that many companies, and particularly their marketing departments, are building video production capabilities in-house to cost-effectively produce the huge amounts of video content many marketers need for their content marketing.
So back in the early days of television onward, if you wanted to advertise on TV you went to an advertising agency and they took care of everything to do with TV advertising, from script to on-air scheduling and everything in between. But now things have changed.
Now an advertiser has a multitude of options: you can buy each and every agency service individually from any number of specialist service providers, you can bring the whole production process in-house and contract the experts you need when you need them or you can still leave it all up to the agency. The reality is that advertisers are now tailoring their production models to what suits them and their needs.
In light of the recent ANA Production Transparency Report in the US, and the growing trend for the ‘Big 6’ Networks to establish separate brands for production services, here is a list of key considerations for your current agency contracts. TrinityP3 believes terms and conditions should be transparent, and not support hidden agendas, especially where an agency may engage a related production supplier. So here are our seventeen areas or principles when reviewing your agency and production contracts:
Review your agency contracts regularly – The contract should contain transparent terms, which are clearly understood by both parties, and reviewed at least every third-year due to technological advancements and process efficiency within industry practices. Do you know exactly what the terms and conditions are of your agreement? If not, you should, transparency is paramount.
Be clear on the type of relationship your contract defines
Contracts are generally one of two formats. This is either one of Principal and Agent, or alternatively Principal and Contractor. Where the Agency is acting as an Agent, the Agency has a fiduciary responsibility to act in the best interests of the client, and procure production at the best possible price. However, where the contract engages the agency as a Principal and Independent Contractor, often terms allow for the agency to mark-up or provide less disclosure and transparency over the sourcing of external production services.
There has been a recent shift towards these agreements where the Agency acts as the Principal with production suppliers, to limit the ‘risk’ of audit and potential compensation in the case of a breach of terms of the agreement. The Agency engages suppliers, which are often deemed external 3rd parties (although often related), which are not subject to the terms and conditions of any Master Services Agreement.
Investigate contracting third party production companies directly
A direct Production Services Agreement with the related 3rd party production house is always recommended, which should include the same transparent terms as the Agency agreement, and especially include the right to audit. This supports the move away from ‘fixed price’ and ‘non-auditable’ external production agreements, which are common within the industry.
The television production process is technically complex and often expensive, which is why it is important that the advertiser ensures that the process, costs and outcomes are managed; not just to deliver the best possible outcome, but also so that outcome is a cost effective…
While many advertisers believe the agency and their producer is there to represent the advertiser, often there are situations where the interests of the agency and the advertiser are at odds with each other. So beware of some of the jargon and interpretations you may…
Are you getting maximum value for money from the print production process, or are you just getting what the suppliers, such as print companies, photographers and the agency want? Below are some useful tips to keep you on the straight and narrow. Share this Image…
Living in a post truth world full of alternative facts and fake news may seem like a recent occurrence to some. But a real fact is that in advertising broadcast production there have been alternative facts for many years that survive the test of time and are perpetuated from one generation of agency producer to the next. These alternative facts assist the agency from having to address the issues that plague the production category and alleviate the advertiser from ever having to worry about taking action to close the loopholes these alternative facts obscure. Loop holes that allow the agency and production house to operate without accountability and at an increased margin at the advertisers expense. Here are a couple of these alternative facts and their implications from the many that shroud the advertising production category.
In this episode Darren Woolley is joined by TrinityP3 Production Guru, Clive Duncan. We discuss: How has technology impacted on the way you make films and videos and especially commercials? You have worked with a lot of directors in many different markets, what makes a…
It was with great interest that I read an article in The Wall Street Journal (Dec 6 2016) detailing how the US Department of Justice is investigating advertising agencies in the US for manipulating the tender process especially for the production of TV commercials. The concept of the agency acting as the production company is not a new one and has been an effective way to produce television commercials in the past. What is of concern is the way the agency and their holding companies manipulate the bidding process to circumvent the competitive process and maximise the profits from their clients.