Man who smashed ‘advertising’s cartel’ warns ‘Find who’s stealing from you and kill ’em off’
Bob Miller, the man who 20 years ago took the power of Packer and Murdoch head on and smashed the media and advertising “cartel”, has warned modern day advertisers need to work harder to pursue value with major questions surrounding the transparency or emerging platforms.
Bob Miller warned advertisers take an example of digital “thieves”
The former head of marketing at Toyota and chairman of the AANA, used the anniversary of the Federal Court decision scrapping the “illegal” agreement between the media owners and advertising agencies that guaranteed agencies a 10% cut of ad spend was a lesson for modern marketers about fighting for their rights.
Miller’s marketing legacy includes introducing “Oh what a feeling!” and the Toyota “Jump”.
Miller recalled the creation of the system in 1965, which effectively insulated media owners from bad debts, and guaranteed agencies a fixed margin of 10% on every ad bought, had left advertisers powerless.
Bob Miller with AANA CEO Sunita Gloster recalling the battle to end the advertising “cartel” in 1996
“It was quite obvious at the time that we were running under an illegal system,” Miller said of the decision by advertisers to join with the ACCC and fight the accreditation system.
“At the time it seemed like a harmless enough thing, as many of these things do, but after a while it turned out to be cancer. That small skin skin lesion you’ve got after a little while in the sunshine, turns out to be melanoma and that’ll kill you.”
He said that under the rules, if bigger advertisers wanted to negotiate with agencies to have some of the 10% commission rebated, the agencies would tell them that it was illegal, meaning advertisers had to pay the same rate regardless of size or risk punishment.
Agencies and media supported the system with the argument that it was also used as the foundation for the then Advertising Standards Council, “which protected them (consumers) from wicked people like me telling fibs”.
“It was illegal, and a racket, and racketeering is illegal. Exerting undue market power is illegal. Fixed margins are illegal and the 10% was a fixed margin.”
He said that few in the media industry seemed to understand the impact of the system they were supporting at the time.
“I remember chatting to (a major network executive) at that time and he had no idea how the industry worked, none. It just hadn’t occurred to him, that he was running a racket, he was just doing what was normal. We’ve always done it this way.”
Miller said that the industry fought back using the Standards Council as a weapon, banning a Toyota ad.
“I’d obviously been warned ‘mess with us and bad things will happen,” he said.
“So I rang ’em up and said ‘mess with me and bad things will happen’, and so they banned another ad, so they were all dead men.
The result was that the advertisers launched a case against against the system and “the media and the agencies mounted case together and worked against their clients”.
The ACCC ran the case with the advertisers emerging victorious in a landmark decision that blew up the industry and started the process of unbundling media buying and planning from creative.
Miller said that the experience of the AANA and advertisers in 1996 was an important message in the modern digital age as major questions about transparency with new digital platforms began to emerge.
He said advertisers were not doing enough to make sure emerging media were delivering value and dubbed one of the world’s fastest growing advertising platforms, Facebook “a thief”.
“I don’t see that you have pursued value – and that is not as a critic, but purely as an observer who has the time now to sit in his garden and ponder these things – I don’t see you get the maximum value,” he said.
He cited the recent “misreporting errors by Facebook as an example of how advertisers were being deceived.
“I see the tragedy of internet, for want of a better term, digital advertising … who is (Facebook) stealing from? (It’s) stealing from you and you’re letting (it) steal.
“You better find out who’s stealing from you and kill e’m off.”
Miller said advertisers had to make an example of businesses that were “stealing” and “hang them from the lamp post in the town square”.
“It discourages other people from stealing.”
He also challenged the TV and print industries to do more to promote their value.
“I’m bitterly disappointed to not see the television industry fighting back,” he said.
“I’m not surprised to see the wimps at Fairfax and all the other incompetents not fighting, but I’m astonished to see the Telegraph and the Murdoch papers not fighting vigorously to maintain their position in advertising budgets.”
sounds like a lovely bloke.
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“the Federal Court decision scrapping the “illegal” agreement between the media owners and advertising agencies that guaranteed agencies a 10% cut of ad spend”
Ummmm yeah that “agreement” definitely doesn’t still happen* haha
Glad there are such strict laws in place to stop such illegal practices! 😉
*Nose extends whilst commenting
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I could easily name an agency that still does this …
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not all stuck back in the 90’s
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I love reading people’s opinions on social/digital media platforms when they have never deployed a Facebook ad in their life. Please……continue, I’m intrigued and tell me how you came to the conclusion they are “thieves.”
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Because the accountability when it comes to external auditing of their numbers? That pretty much ends the conversation. But there is also the fact they count reach in a completely inaccurate metric (less than a second counts for reach) and a lot of the data that would expose them being ineffective they wont release. Digital works but not as much as it is lead on
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How do they measure reach for TV & Radio? Isn’t it based on historical data so how do you know you will actually reach the people you are saying you will?
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His language is not Self-aggrandizing in the slightest ‘String them up from the lampost’ ‘Bad things will happen’. I think he actually believes he is taking on the Ndrangheta or something similar.
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Historical date used in both TV and Radio is monitored continually and shows patterns of behaviour that tends to be pretty damned accurate. in lieu of anything else it serves its purpose.
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The intelligent reader will realise that Miller’s comments about stringing people up were metaphorical. Judging from the comments it’s apparent there aren’t too many of them.
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