Everyone has a role in reinventing media agencies

Everyone has a role in reinventing media agencies

It's time to start talking about the solutions to the trust and transparency questions dogging media agencies.

Enough about the problems. Let’s start talking about the solutions to the trust and transparency questions dogging media agencies.

Scott Moorhead, former head of digital trading at Havas, claimed in last week’s Campaign that the media agency business model is "broken" and that the big six groups have resorted to making "mountains of undisclosed income".

We asked for feedback and many responded, on the record and privately. In an online poll of more than 500 Campaign readers, 82% said the model is "broken" or needs to "evolve". Only 18% disagreed.

If things are going to change, agencies must take the lead. They have the power to change their relationship with clients proactively.

It is easy to blame brands and their procurement departments for slashing agency fees. But, as one leading advertiser says, many agencies chose to offer increasingly thin margins and more opaque trading, even if they don’t all have the same business model.

In return for greater transparency, agencies can and should demand better fees. 

As their part of the bargain, advertisers should treat agencies with greater respect, stop obsessing about price and educate themselves about media trading.

Having a healthy relationship with an agency does not mean outsourcing all media. The future for brands is doing more in-house. Media is too important to leave to outsiders in an era of greater accountability and addressability.

There is lots of talk about how a brand should appoint a chief media officer but smart advertisers have been doing that for years.

The savviest brands are going a step further with their in-house media function. Sky has recently recruited a head of media strategy and effectiveness from Ebiquity. Expect other advertisers to follow.

Constructive dialogue is essential. Leading agency groups are once more talking to ISBA after the "cold war" earlier this year when the trade body suggested agencies no longer have clients’ best interests at heart. Indeed, ISBA declined to comment to Campaign about Moorhead’s article, preferring to keep its dialogue with the agency community private for now.

Two other groups could contribute to the debate: media auditors and benchmarkers need to do more to regulate their relationship with advertisers and agencies – something on which the IPA says it is already working. Media owners also know a lot about agencies’ darker habits, yet they have stayed silent.

Everyone in the transparency debate needs to ask themselves how they can be part of the solution.


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