When Worlds Collide: GroupM Undermines The Agency Model

groupm-pied-piperLike rats following the pied piper into the East River of New York City, Rob Norman's GroupM believes it knows best when it comes to its clients' future - and the future is closed.

Are the lawyers in charge over there or what?

This is it, people - the end of the agency model as we all know it.

In a story in yesterday's MediaPost, Joe Mandese reveals that GroupM is revising its Terms and Conditions (T's and C's) used with online web publishers for all media buys so they include the following statement:

"Notwithstanding the foregoing or any other provision herein to the contrary, it is expressly agreed that all data generated or collected by Media Company in performing under this Agreement shall be deemed 'Confidential Information' of Agency/Advertiser."

We would assume that this sort of agreement will apply to exchanges and networks, too. This raises many, far reaching questions and not the least of which is how can a publisher sell placements in the future without being able to talk about the past (with anonymous data).

Other questions:

  • How is an exchange going to function without transparency on publisher placements?
  • Will yield optimization companies no longer be able to look at publisher campaign CPMs and inventory available through its services because certain campaigns may be associated with GroupM?
  • Will Comscore no longer be able to report advertising exchange and network traffic because they are running GroupM campaigns?
  • Will Compete.com no longer be able to report web traffic data that might be affected by a GroupM campaign?

Later in the article, John Montgomery, COO of GroupM Interaction, equivocates and says:

"The real issue around that is the old terms and conditions didn't really accommodate the data question properly, and our clients as you might imagine, have so much data generated from advertising these days, that they wanted to make sure their insights about their advertising is kept confidential. And that the data is used by the publisher only in aggregate, not at a granular level."

Aggregate and not granular? That's not what your T's and C's say, John. And what does "aggregate" and "granular" mean, anyway. Who knows?

Let's be clear. If Mandese's T's and C's quotation in the article is true, then this appears to be a wide-open loophole for GroupM to own ANY data associated with ad campaigns. It is conceivable a publisher won't be able to say, for example, that we had an advertiser run a campaign in the health and medicine section of our website and it was very successful driving X amount of users at a CTR of X. Or even how many people visited the site in the month of January.

And, the publisher would not be able to create a transparent history of data that can be used by future potential advertisers who are trying to extract an understanding of value of publisher placements if agencies like GroupM and its offspring are not allowing data to flow freely.

Something will give, and it will be GroupM as the agency monolith whithers under its archaic, data ownership mandate.

Openness and transparency are central elements of the exchange model. There is no openness in GroupM's model if they are not going to share and offer transparency just like publishers.

One other note: technology, and the data it produces, is the advertiser's best friend (but maybe not the tunnel-visioned agency). Technology enables the Web to provide advertisers an understanding about consumers - individual consumers - and comes closer than any other advertising medium to the goal of one-to-one marketing .

If the sharing of information is shut off, the advertiser will never get close to responding to the needs of the individual consumer and, moreover, never have a true understanding of ROI for its ad campaigns.

3 Comments

  1. Interesting stuff...This is clearly a case of a rash decision being taken without fully understanding the longer term consequences. I run a new breed digital media agency in London (Infectious Media), with buying infrastructure and process built around data and technology (exchanges being core to this). Of course advertisers and those representing them have concerns over data ownership, but the answer is NOT an overly protectionist reaction as this appears to be. Collectively, everyone in the value chain benefits from intelligent, appropriate and transparent use of 'aggregate' and 'desensitised' campaign data. The challenge lies in defining what qualifies as 'aggregate' and 'desensitised', and having a credible independent authority to audit compliance.

    Reply
  2. As the former head of the IAB during the last re-writing the T&C's, I wanted to share my thoughts on this data issue raised by GroupM. I think this is a very short-sighted move by GroupM. The focus should be on building better media for advertisers AND consumers which I believe would suggest helping publishers and networks aggregate more data that can be used/sold to advertisers to better target ads. I am not even sure what GroupM thinks they are protecting? Is it the insight from the dismal <0.5% click through the typical agency creative receives?

    This feels like protectionism and the “anti-fair-trade” version of Online Advertising. I'd strongly advise publishers and agencies to just say no. And how does he plan to execute this? I don't know that it's even possible. The publishers have the data, they will use and he'll never, never know.

    Can someone tell me if GroupM put out a clear POV and not just a press release.

    Historically interesting too is that it was a GroupM staffer who lead the AAAA's side in writing the last T&C's. Funny about that was that I was told by publishers that GroupM never used the T&C's created, and AGREED to, by the AAAA's and IAB in 2002. They instead renegotiated items that had already been worked out, which always seemed like a dirt-bag move to me.

    I talked to John about this in 2003 and he was blasé and never provided a response as to why they'd put the industry through so much effort (it took 9+ months to rewrite those T&C’s) only to agree and then not adopt the T&C's they'd lead the charge on. It was a big waste of everyone's time I thought and for as long as I lead the IAB, I refused to go back to the table with the AAAA's until they gave me in writing that they would adopt whatever T&C's we’d collectively negotiated. Only seemed fair to the media sellers.

    Again, I’d just say no thanks and keep focused on building the best medium the Internet industry could.

    I'll happy to debate this further if anyone wants.

    Greg Stuart
    Former CEO of the IAB

    Reply
    • Thanks for this, Greg. I have never seen a press release other than the Mandese article and quotes from Group M. Given the uproar, and silence that followed from Group M, it would appear that Group M issues pr through MediaPost now.

      Reply

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