Lack of media transparency is also an issue in Australia. Yet many still ignore it
This week the Association of National Advertisers in the US released an incendiary report pointing to widespread questionable conduct by media agencies. Australia faces identical issues, but are Australian advertisers less likely to see their own industry body speak out because of conflict of interest, asks TrinityP3's Darren Woolley.
Throughout the past 48 hours there has been much discussion about the ANA Media Transparency Report by K2 and its implications.
The report’s findings are an anonymous but largely credible representation of the current situation in the US, and from our experience also in the Australian media market, too.
In fact, back in 2012 we first became aware of the term ‘value bank’ and the escalating rebates between media publishers to media agencies.
Whilst the phenomenon went by various names, it soon became apparent that this was a relatively widespread practice. We therefore exposed this trend on our website in May 2012.
That’s more than four years ago. We shared this information with advertisers who appeared to not appreciate the scope of the practice or its implications.
We shared it with the industry bodies that represent the advertisers and the agencies.
And for four years nothing was done.
We expressed the impact this practice was having on the ability of agencies to advise their clients with media neutrality and even questioned that – in a market where some agencies and their holding companies could be generating more revenue from the media publishers than their own clients – who were the media agencies actually working for?
In the wake of the revelation of misreporting by MediaCom two years ago and the subsequent acknowledgement of the existence of a value bank, the bodies representing the advertisers and the media agencies prepared a set of voluntary guidelines on how advertisers might respond.
What is stopping the peak advertising industry bodies responding and providing leadership on these issues?
Is it possible that – unlike the ANA in the US who commissioned this report, and ISBA in the UK who have developed their ‘best practice media agency contract’, practical advice and leadership – local association the Australian Association of National Advertisers (AANA) is possibly compromised by the fact that their membership has both advertisers and agencies amongst their financial members?
It is difficult to represent the interests of your members when your members possibly have conflicting interests. But here is another point often overlooked in the discussion to date.
The focus has been on both the advertisers and the media agencies. But as the ANA K2 report shows, the third party often overlooked in the discussion is the media publisher.
They are the ones who create the inventory that makes the whole industry possible.
Where is their voice on this matter?
We have had feedback from individual media owners who have suggested that industry consultants like us and media auditors and procurement have been to blame.
But it is clear in these conversations that they are disappointed in the media agencies, too, yet are afraid to speak out for fear of retribution. It was left to Peter Wiltshire at Nine to speak out on this matter before leaving the industry earlier this year.
It would appear that the industry is compliant in wanting to ignore the issues and hope they go away.
The advertisers and their industry body are practically silent on not just this latest report, but on the issues as a whole.
The media agencies and their industry body are likewise mute. And the media publishers are silent as well.
Yet to bring about change someone has to speak up and start the discussion to address these issues. Who is going to start the process?
Because while we have continually raised the issues, it appears it is convenient either to ignore the issues or to blame the messenger.
Darren Woolley is owner and CEO of marketing consultancy TrinityP3 and until earlier this year chaired the Australian Marketing Institute. He says over the years, as a former Strategic Partner of the AANA, he had proposed a number of industry metrics and initiatives to improve transparency to the AANA and MFA, the most recent of which was declined this week.
*The AANA has responded to Woolley’s statements in this opinion piece with the following statement:
“The AANA is providing leadership on all the issues that impact advertisers. In relation to the transparency issue, we are absolutely focused on ensuring that advertisers get fair value from the media buying process. The vast majority of the Board and membership base of the AANA is comprised of major advertisers. Under our constitution, we allow agencies to join but they have limited voting rights. They are invited to participate so that advertisers have a wholly informed view of the matters under discussion.
The Board of the AANA is united about how best to tackle the issue of transparency in media buying. It should be noted that the ANA’s preliminary recommendations to marketers (following the publication of the K2 report) address the framework that marketers should develop for contract and remuneration agreements. This is precisely the area we have been concentrating on and it is absolutely the point at which attaining transparency must be thrashed out.
The AANA does not duck controversial topics irrespective of whether that makes agencies or media owners feel highly uncomfortable. You just need to look to our current Marketing Deconstructed video with Mark Ritson for proof of our determination to play a leading role in informed discussion about best marketing practice, irrespective of whom that may offend.”
Got something to sell Darren?
More consulting fees??
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Amazing you run this stuff mumbrella, letting people who want to cultivate an environment of mistrust and paranoia for their own gains the chance to say whatever they want with no real right of reply.
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I’m not sure it’s the best selling technique from Darren to point out that some media owners think consultants are to blame for the issue.
@Bashed Didn’t you just demonstrate a right of reply by commenting? But if you want to elaborate further on your views submit a response – I’ve seen Mumbrella publish many a ‘right of reply’ to an issue.
Apart from Darren having an agenda to sell his company, what is actually false with his statement? I’ve been very surprised by the lack of response on this issue. Having worked both client and agency side I see it as an issue both sides need to have cleared up so why is the response so slow?
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