Monday, April 13, 2009

Is online ready to be taken seriously?

The online advertising worlds opinion of itself might be a little further along than it really is, and at the moment, I wonder whether it is ready to be taken seriously.

Thanks to the dirty 'R' word that is being bandied around, we are seeing every rep that there ever was coming in and talking to us in the agency. Its amazing. These poor sales people (a term for some I lose loosely - one online rep who has recently jumped publishers is on a tidy sum I hear) have had to start working for their budgets, not just order taking. To be fair, some reps are coming in and telling us about great new products/ideas/initiatives, it is nice to see some companies changing and adapting in the face of recession. Others, however, are most certainly peddling the same wares.

The one thing all reps typically have in common, is respect for the agencies. Be it television (although they have pushed it recently), radio, outdoor, cinema, press or print, they all understand that those of us in the agencies actually want to work with them, to create fantastic schedules for our clients and ensure that we both win. And in that respect, they all offer agency commission bearing rates.

Don't get me wrong, online also offer commission, however, they offer it to all and sundry. Agencies spend a lot of time and money to become accredited; other media channels respect this and offer commission to agencies only.

When a direct client comes in, guess what, you don't have to give them commission, which means more money to the publisher... This is standard practice for media suppliers, all around New Zealand. The reason that agencies get commission is because, in general, we can bring in more overall budget. It turns into a win win situation. When publishers will give commission to every man and his dog, it is the agencies and further down the track, the publishers, that will lose out.

The message that we get from the publishers is that they should be taken seriously, given a bigger slice of the pie; online use is increasing, across a number of demographics, therefore, media spend should reflect this. I don't understand how agencies are meant to take publishers seriously when they don't take us seriously. In order to ensure that our clients have a full and comprehensive media mix (yes, including online) we need to be placing our clients online advertising. There are a number of independents out there who are now placing online only for a number of clients separately from the rest of the media schedule. The reason that these people can do so is because the publishers are allowing them to have commission. Commission = no fees to client (hence why agencies typically don't charge media on an hourly rate).

I understand that there is some client education required, but it is the publishers who are allowing commission that are enabling this to happen. When agencies have a full media budget, we can disperse it completely to where the audiences are. This can mean online getting a bigger slice of the pie than they already have, depending on what our research tells us - yes, it is telling us the same thing the publishers are, usage and time spent on the Internet is up across a number of demographics, if we had the budgets, our spends would reflect this more accurately.

If publishers want some more budget out of agencies, and to be taken seriously, then they need to work out where they stand. Are you working with agencies, or against them?

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