James Warburton on Nine’s proposed media buying platform: ‘If that’s the solution, we’ll 100% back it’
Seven’s CEO James Warburton has said he will support Nine’s proposed media buying platform if agencies genuinely think it’s the correct solution.
Michael Stephenson, Nine’s chief sales officer, announced the proposition at last week’s upfront event, stating that Seven, Nine, Ten, SBS and Foxtel are committed to building a platform that serves as one interface for media buying across networks. Mumbrella understands due diligence has commenced to determine the technical supplier, and that the technology would allow agencies to buy linear TV, live streaming and on-demand spots.
Speaking last week at the Media Federation of Australia’s (MFA) inaugural MFA EX conference, Warburton said he’s already heard arguments over whether the platform is the right solution.
Warburton speaking at Thursday’s event
“My question is, is it the solution? What interests us is not what the platform is, [but] does the industry, does the Media Federation and all the groups believe that’s the solution? If that’s the solution, we’ll 100% back it,” Seven’s chief executive said.
“But already I’m hearing there’s two or three different solutions, there’s arguments about certain things. So in some ways, we can be the swing vote, if you like, in terms of it. So, is it the solution the agencies want? If it is, then we unequivocally back it.”
Warburton, who stepped into the role two months ago, also touched on why agencies need to start valuing their work more, comparing the current market to that he faced as leader of media agency Universal McCann.
“I think the problem with it at the moment is the agencies, and even, to an extent, the media, are doing so much more than we’ve all ever done, yet the remuneration structures are the same,” he said.
“I think the media agencies are probably undervaluing the service, as are clients. The only caveat I’d put on that is the race to the bottom and the pitch process and the procurement process about undercutting each other … it’s the same issue that’s out there [as it was when he was at Universal McCann].”
Now he’s made the transition from media agency to media owner, Warburton is well aware of the “shit sandwich” agencies offer media companies like Seven when they win a new account. It’s potential business for the network, but that comes with pressure to offer a good, and possibly unrealistic, deal.
“You’ve got the agency that lost [the account], that’s highly emotional, and they’re saying to you, ‘If you deal with [the agency that won] and you give this discount, we’ll know you broke. Those rates are ridiculous,'” Warburton said.
“Then, on the other side of the equation, you’ve got an agency saying ‘If you don’t do this, we’re going to screw you’ and in the end you lose the client. So I think it’s a lose-lose situation. And it’s not every pitch, I should say that.”
The solution? A vetted process that is transparent for clients and agencies, according to Warburton.
“I would say to the procurement agencies and all the personnel, why not have a process, or why doesn’t the Media Federation have a process, where any offer is vetted, through PwC or through anyone independent?” he asked the 1,500-strong crowd.
“Clients should know what their rates are and then if an agency is offering 20% or 30% or 40% or 50% better, then why shouldn’t there be a vetting process to keep everyone honest? And why wouldn’t the agencies agree to that, to keep the margin up? Because pitching should be about people and it should be about people who can make a difference for clients.”
Brittney Rigby was Mumbrella's deputy managing editor - news and analysis. She left Mumbrella in April 2021.
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If you talked to your agencies about anything other than how much inventory they want at what price you;d know this.
I could give more insightful thoughts for less than he is paid
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Vetted transparency? T’was ever thus. In the States, every year post-the upfront season where billions of ad dollars are traded, each holding company and its media agencies without fail trot out a presentation to their major clients trumpeting how their traders have beaten the market. All of them beat it! Amazing. That’s economics folks.
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Yep, it was fine to chase business down the drain pipe whilst JW was at UM…..but now it needs to be different.
Who is he kidding?
He’s in the gig to package Seven up to be sold to the highest bidder and he will be in the gig for two years max…..just like everywhere else where he has been.
Grain of salt here…..Seven is in more trouble than Trump and James is simply polishing it up.
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