Start with the answer, should we do media deals backwards?
Generally speaking media has become a commodity, traded predominantly on price. We know this is a sweeping generalisation, but we feel it to be broadly true. Everyone knows that media owners, and agencies should be trading “outcomes” not “inputs”, and media auditors should be measuring these outcomes, not inputs. But they are not. Inputs are things like reach, frequency, or impressions. Outcomes are the positive results of the media activity like a test drive, or a new customer signed-up on a website, or a brochure downloaded.
If you were a car manufacturer what would you rather have: for the same money, a low cost-per-thousand impressions delivered, but few test drives, or a higher cost-per-thousand but lots of test drives?
But, whilst everyone knows the whole ecosystem should change to trading outcomes, it rarely happens beyond a minority percentage of media expenditure spent on-line.
Why?
Probably because mass media owners do not want the level of accountability, and they still represent the lion’s share of the media spend.
Probably, outcomes are not delivered because some of the media agencies’ systems, processes, and structures are built to serve an old economy, and whilst scale can help deliver price, it may not automatically deliver a positive outcome, which really needs brains and new tools.
Probably, outcomes are not traded as much as they should be because research proving the accountability of each media execution is difficult, and therefore expensive.
Probably, outcomes are not delivered because, by their nature, they are proprietary, whereas some media agencies and auditors (who often judge agency performance) want to preserve their own simple common methodology for their own business efficiency.
Probably, outcomes are not traded as much as they should be because the creative agencies, that dictate the outcomes of the advertising probably more than the media agency, media owner, and media auditor, are not held to account in the same way as their peers.
Ultimately, though the reason why outcomes are not traded is because not enough clients ask for them to be traded, or provide enough information to make it possible.
So, if you are a client with responsibility for advertising or media, what would happen if you got your biggest media suppliers, your media agency, your creative agency, and your media auditor all in a room and asked them to figure out, using all their data, all their tools, and all their brains how to improve “outcomes”, what do you think would happen? How come this has never happened to me in twenty fours year of being involved in our business?
What would happen if you got your agencies, and partners in the media to “start from the answer” and work backwards? I.e. if you told the full media ecosystem that there was a price per outcome, that you could afford, and the ecosystem needed to reorder around it to deliver it.
I am a realist. I am fully aware of how hard tackling the vested interests, the stasis, and the complexity of our business is. And, no-one is advocating a wholesale revolutionary change in days. But, the journey of simplifying and reintegrating the media trading process needs to begin, and clients must lead it.
Is there a price to pay for trying to join up media? Probably?
Would the benefits pay for the cost? Probably?
Are there people that can understand the full ecosystem and can help you realise the benefits? Definitely.
How kind of you to say so…
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