"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Jeff Puzenski, an executive at Infinitive.
The Association of National Advertisers (ANA) dropped a bombshell in June when it released a report about transparency and media buying practices in the digital advertising landscape.
For digital marketing executives at brands, publishers and agencies, there was a sense of “now what?” in its aftermath. The ANA then released a second report with recommended actions and a to-do list for brands.
While it offered many good ideas, there was too much focus on the transactional and contractual parts of the business, and not enough attention on the strategic parts. It also had a “one-way street” tone, with most of the recommendations directed at brands rather than agencies. Many sound like unpleasant things brands would do to their agencies, rather than with them.
Given the complexity of the digital advertising world and the important role agencies play, the report could have called for more dialogue and collaboration. Most agree that the vast majority of agency-advertiser relationships need a reboot. Rebuilding trust and transparency for the industry as a whole can’t happen without conversations among multiple stakeholders.
The ANA’s recommendations makes sense but there are additional or enhanced steps brands and agencies should take to to build strong, sustainable and mutually beneficial partnerships, rather than strictly contractual ones.
Avoid The Blame Game
Given that the biggest goal and top priority – ensuring that more consumers see the right ad in the right format at the right time – is shared by agencies and advertisers, it is important not to assume the relationship is based in poor faith.
While the critical transparency challenges highlighted in the report should be clarified, the sooner stakeholders focus objectively on the underlying business issues, the sooner they can reap the value of stronger and more collaborative relationships.
Establish Accountability In The Context Of Relationships
The report’s lawyerly focus on the need for disclosure of conflicts of interest and “complete, thorough and deep audits” doesn’t sound like the basis of partnerships. Yes, the amount of money advertisers spend with publishers necessitates stronger oversight. And someone should monitor the flow of media spend and optimize the relationships with recipients.
Auditing should be possible, but building better relationships is a better starting point. That can help build ROI and remove the need for potentially expensive audits. In some cases, such as for a large CPG, a chief media officer may be an essential role. For other companies, such positions won’t be realistic. The discussion must focus on identifying the right activities and capabilities for advertisers to “insource” and “outsource” to agencies or other partners. The report’s guidance to recognize “stewardship of media investments as a shared responsibility” is on target.
Align On Objectives Upfront
The report counsels agencies to “err on the side of communicating everything to advertisers.” I’d also encourage advertisers to also share more information on campaign objectives.
The advertiser-to-agency-to-publisher game of telephone shows diminishing returns. Objectives are often not clear, properly communicated or fully understood. Proper campaign execution and success are critically dependent on clearly defined and fully understood objectives.
These interactions need to be built on a common vernacular and understanding of the campaign’s capabilities and objectives. At minimum, better upfront briefing conversations, with consistent messaging, are needed to align stakeholders on campaign targets, goals and metrics. Brands and agencies must also discuss the costs and benefits of technology, media and resources required for campaigns. Such insights will help advertisers understand which top-priority skills they need to develop in-house and which agencies or other vendors can supply.
Clarify The Contracts To Gain Visibility
This is the tactical side of relationship building, for which the ANA report offers solid guidance. Its template MSA is a vast improvement of many existing contracts. Agency contracts have long been an afterthought for many agencies. Outdated contracts are not uncommon. They should be revisited to reflect changes in audience behavior, experience design or devices.
The objective is to clarify ad-buying parameters and agency compensation. Incentives can be added or adjusted as visibility into performance improves. The focus should be across ad spend and on gaining big-picture visibility into overarching terms. It is also important to dig into critical preferences on media mix, such as native, mobile and video, and visibility to programmatic and ad network spend as these can be much more opaque.
Revise The Metrics For Success
This is a huge opportunity and potential win-win-win. Advertisers, publishers and agencies should align on specific, relevant and verifiable goals before campaigns start. Too often goals are vague and lead to competing interpretations of performance data and painful conversations about make-goods.
With brand awareness, for instance, there are ways to measure performance but the goal should be simplicity and performance validation, not an overly complex, multilayered approach that may conflict. For example, you don’t want to track both high click-through and completion rates for video ads because these are conflicting metrics. Clearly defining standards for viewability – and whose numbers will be the basis for measuring – is another critical activity.
Define The Data Ownership Model
This is another big opportunity with mutual benefits for stakeholders. The ANA recommends that “advertisers should maintain full title over all data sets that relate to their business, with the unhindered ability to store, access and use those data sets.” That is likely not possible in the immediate term since many advertisers are just now becoming aware of the value of their customer data. The most important first step for many will be to clarify requirements about it use – specifically, what data agencies will be provided and how it can be used.
They may also explore creative data sharing and third-party data sourcing agreements, where direct data ownership is not possible or more data is needed. Again, most advertisers don’t want or aren’t ready for 100% control of data, but likely they want more control and visibility than they have. Again, flexibility around mutual goals is a plus here.
Whichever side of the digital ad world you’re on and your feelings about the ANA report, I think you’ll agree that there are clear opportunities to strengthen relationships in ways that improve the overall health of the business.