ANA Marketing Procurement Trends in 2018

Flock attended the ANA Financial Management Conference in Hollywood, Florida earlier this week, and here are some high-level thoughts and take-aways for you.

1. Agency Compensation

Three years since the ANA and WFA shared their recommendations on better agency/client contracts it is fair to say that about half of the marketers in attendance had addressed their agency compensation. The new models seem to have a “fair” starting point in coming (i.e. the agency is “allowed” to make some margin) and pay-for-performance is incorporated. The other half of attending marketers had not yet addressed the issue but were at least very aware of the need.

2. In-House agencies

We saw a fantastic presentation by MGM Hotels and Resorts, outlining what we would call a “text book” execution of how to set up and run an in-house agency. The key issues addressed included a clear alignment across all stakeholders to what the role is of the in-house agency vs. the external agency (MGM work with McCann). It was telling that the presentation was delivered by the marketing CFO and the head of marketing. They also had a clear process on how content was developed, approved, produced and distributed. These are critical ingredients for success we have often implemented when we have assisted clients with similar challenges.

3. Data

Yes, data, data everywhere. The challenge remains to determine which data matters for what purpose. Flock have supported various clients on how to approach this challenge, building data driven agency performance models as well as sales and e-commerce driven solutions.

4. Programmatic

Programmatic has become a far more mature and better understood digital advertising opportunity versus a few years ago. However, the industry is still plagued by significant cost for various middle men in the eco-system, as well as bot traffic, fraudulent placement as well as safe content issues. It is kind of sad that the ANA shared that if a marketer does everything “right” the amount of dollars not reaching a consumer can be minimized to 23%. If marketers leave issues unaddressed, this goes up to well over 60%!

Flock has supported various clients with developing improvements in the how of programmatic, as well as reviewing and implementing contracts that build in as many safe guards as possible.

5. Creative Briefs

Flock has been a proud contributor to ANA’s Better Briefing project, and many of our ideas and suggestions have been adopted into the ANA Better Briefing recommendations. We have written about this before here.

6. A.I.

Yes, A.I. is showing early signs of relevance in marketing, but more in consumer facing platforms and solutions that allow for easier interactions, e-commerce, understanding of data and reacting to this, etc. The applications for marketing itself are years away.

7. Transparency

As outlined under points 1 and 4, transparency is better understood and addressed, but a lot of work is still to be done. This year, we shared our learnings with the World Federation of Advertisers. You can read more about that here.

Flock is partnering with the ANA to create an updated model agency contract, which will most likely be ready for sharing by the end of this year.

8. Blockchain

This is even further away than A.I. is. There are applications being tested on a small scale around digital ad placement and pricing. The opportunity is that it will aid transparency and further diminish the role of the various middle men making money of ad placement (see point 4). But this is years away, and even then won’t be a solution for all media placement. Time will tell!

9. Production

Production is going hand in hand with Inhousing agencies and programmatic, as many advertisers find that taking control of aspects of production saves money and simplifies development and distribution of content at scale at affordable price levels. Flock have assisted a great many clients in assessing if there are opportunities in this space, and how to best execute and organize around these.

10. Biggest take-away

Marketing has gone from naïvely partnering with agencies, and letting the agencies control far too many aspects of the marketing ecosystem (and making a lot of money in the process) to being far smarter and savvier about the role of marketer vs agency. Marketers own more of the process and understand their role and responsibilities within that process far better than say three years ago.

Flock has been a proud contributor to the “emancipation” of marketers and the industry as a whole. If you are interested in learning how we have done that, and how we might be able to help you, please let us know – Julie Marshall, julie.marshall@flock-associates.com