Nick Manning, chief strategy officer at Ebiquity, disputes some of the assertions made in M&M Global’s recent feature on the pitfalls of international media pitches.
Sometimes the answer to a question is just “no”. This week’s article in M&M Global, ‘Fear and Loathing: Are international media pitches spiralling out of control?’ is one such question.
Ebiquity handled over 100 separate media agency selection exercises across the world in 2016, many global, several international. This gives us a unique insight into the market and our experience on the front-line is different to the trends outlined in the M&M Global article.
Some of the commentary in the article was misleading regarding both client behaviour and how Ebiquity operates, so we’d like to add a different perspective and correct any misunderstandings.
Let’s start with global pitches. The big global media agency selection exercises are precisely what the big network agencies want, and are what their new business development teams toil endlessly to stimulate. But when you’re tendering at the most senior level with the world’s biggest companies, you’ve got to be prepared to accept the rules of engagement, and it’s not going to be easy.
The Volkswagen exercise quoted in the article spanned a number of brands, many territories, many requirements and stakeholders. Of course it was going to be demanding of the tendering agencies, and if they couldn’t perform at the highest level everywhere, they may not be the right agency.
The media agency world likes to compare itself to other global professional services sectors, but it doesn’t seem to have got there yet. It hardly seems likely that the legal or accountancy equivalents of M&M Global would feature senior supply-side practitioners complaining about complex tendering processes, so our industry had better shake off its creative agency roots and join the rest of the professional services world.
Media is where the big money is, and after several decades of striving to be taken seriously, the media agency world has got what it wanted.
The statement in the M&M article that “the sight of Ebiquity’s name on an RFI is a tell-tale sign that the advertiser is looking to strip out costs” is not attributed as a quote to anyone, so it is hard to know how or why it was included. However, it is an inaccurate representation of both our clients’ intentions and the service we provided during the 100 or so exercises we helped clients manage last year.
Yes, companies want to manage their costs. They have business targets to hit, budgets to manage and capital to deploy, and they want to apply the kind of rigor to advertising that they would to other very large capital items. We all know that advertising should be an investment, but it’s also a capital item and needs significant management.
Cost management and return on capital will always play a central role in most media agency selection exercises but that is not the same as clients wanting to push media pricing down. It’s about return-on-investment and clients understand the differences.
The media agency networks also often make a big play of having the scale to be able to guarantee better media prices as part of their pitch promises. This is nothing new. Neither the client nor Ebiquity specify what the media pricing should be or what the fees should be. The agencies offer and the client accepts or doesn’t.
This is business
And, yes, sometimes companies want to reduce their advertising budgets by buying media more effectively. This could be because they want to invest more in other market-building initiatives, reduce product pricing or many other reasons. This is no different to wanting to build a factory to drive business while tendering factory-building for less capital outlay. This is business and there is nothing wrong with the kind of cost-control which features prominently in the media agencies’ pitch promises.
However, it’s entirely inaccurate to say that cost management is all advertisers want or all Ebiquity helps them achieve. Ebiquity’s typical media agency selection exercises involve a deep-dive into agency capabilities of many kinds, including data and technology resources, strategic thinking, social media skills and much more.
The M&M Global article was entirely right in saying that the media transparency initiative conducted by the ANA in 2016 features heavily in pitch discussions. Of course, it does, but it’s not just the K2 Intelligence report that features.
“Agencies need to be excellent at batting, bowling and fielding. That’s business”
There are two other components to the initiative, namely the recommendations document authored for the ANA by Ebiquity (‘Prescriptions, Principles and Processes for Advertisers’) and the new template client/agency contract produced by ReedSmith and Ebiquity (based on the ISBA model) to provide a firm contractual basis for the client/agency relationship.
The recommendations document sets out a seven-point roadmap for advertisers to achieve effective media stewardship across their range of needs. The ANA recommendations and ISBA/ANA template contract now heavily influence and inform the conversations that Ebiquity have with clients. Cost always plays a role but never exclusively.
The M&M article talks of a “sense of exceptionalism” among media agencies without really explaining what this means. All media agencies like to think of themselves as different and exceptional, but our experience honed over many years in many territories shows that the client will be the ultimate judge of who is exceptional and who isn’t.
These days Ebiquity has many varied techniques for testing the true capabilities of an agency, and the successful ones win for a reason. The combination of the right thinking, resources and commercial terms will always prevail.
So, if there is ‘fear and loathing’ out there, it is perhaps a sign that the media agency industry has now achieved its ambition of joining the Big League, and it’s not a comfortable place to be. Agencies need to be excellent at batting, bowling and fielding. That’s business.