Advertisers to swap notes on what they pay agencies
The industry body for Australia’s biggest advertisers is to undertake a major project examining what they pay their agencies.
The project – overseen by pitch doctor Darren Woolley – will see members of the Australian Association of National Advertisers all receive a copy of the aggregated results, which may give those who currently pay over the odds additional leverage to demand a discount.
The AANA said the project was part of a global initiative looking at all facets of agency remuneration. These include the most common methods of remuneration, how often renegotiations take place and what factors lead to changes in agency remuneration agreements.”
AANA CEO, Scott McClellan said: “When it comes to remunerating agencies, advertisers can choose from a variety of compensation models from commissions to fixed retainers to labour-based and value-based fees, or a combination of options. The increasing fragmentation of the media landscape has also given rise to specialist agencies which adds further complexity to the remuneration process.”
McClellan said insipration for the survey came from the United States. He said: “A remuneration survey has been done by the U.S. Association of National Advertisers for about 15 years, and we have modelled our questionnaire on theirs so that results can be compared. We will also feed our results into an international study being done by the World Federation of Advertisers. This will give us global comparisons.”
The survey – which will anonymise the data – will be conducted on behalf of AANA by Newspoll, with technical support from Woolley of Trinity P3.
Tim Burrowes founded Mumbrella in 2008. He worked on Mumbrella until 2021. At various points he was editor, content director and editor-at-large.
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F*%k…they’re onto us. Exit, stage left.
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‘anonymise the data’? Pardon?
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Any advertiser who judges their agency solely on cost is headed the wrong direction. This does not bode well for the industry already heavily commoditised.
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agree Les. No idea how agencies are going to pay their staff when there are already no margins…
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Wonder if they will include agency DSP’s in this?? Let’s hope they expose the DSP platforms as the new ‘cash cow’ for agencies….
Advertisers – wake up!
DSP’s are there to make the agency more money outside of fees, not to look after your interests – HELLO, does anyone not see the conflict???
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While it’s fine to conduct the research to establish the cost benchmark, would it be considered anti-competitive if participants of the research then used those results to drive down their agency remuneration so that they were no longer “over the odds? This of course, that would drive down the benchmark … resulting in a new round of racing to the bottom.
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will one day media agencies offer media services for free so they can make money off their DSPs?
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