International media procurement – Three reasons it beats the global media network solution
In seinem Beitrag zu den Media-Essays von thenetworkone stellt Martin Albrecht das Modell Media Procurement als Alternative zu den global agierenden Media Networks vor:
The Challenge for Global Clients
Until recently, global advertisers had practically no choice when
it came to choosing their media solution: they would have to pick
an agency from the six global media network behemoths, who
jointly serve 90% of the global media market, essentially offering
17 different shades of vanilla.
They all have one compelling argument going for them, though:
they are globally present. Other than that, they rarely get
anybody excited.
Network Media Agencies are built for the $100million+ crowd of
advertisers, they lack the creative and innovative talent that gets
ambitious marketers delighted and above all, they are completely
unable to silence the accusation of intransparency: Even in the
US, media agencies have now come under scrutiny from the ANA
and others for their standard business model that appears to
benefit the holding groups much more than their clients –
especially their non-trophy clients.
In this industry environment, it is no wonder independents and
in-house agencies are on a sharp rise. While they often cannot
provide the scope of their network rivals, many clients prefer
them: they deliver better, cheaper, faster solution because they
operate in an entrepreneurial environment and nourish an
innovative culture. But it gets even better.
How International Media Procurement Works
With a new approach to international media services –
“International Media Procurement” – CROSSMEDIA has introduced
a new service and business model ensuring the agency can stay
focused on what it does best: providing excellent advice. This
procurement approach brings three previously unattainable
benefits to clients in need of global media services: full transparency,
closing in on the market price and retaining budget power.
But first, let us see how it works:
Separating Strategy from Execution
As the “Media Procurement Team” rather than the media agency,
we provide a hub of internationally savvy media strategists and
account leaders. With the help of thenetworkone, we also are
responsible for assembling, contracting and leading a WorkNet
of local media agencies around the world responsible for tactical
planning and execution on the local level. They work closely with
our central hub to inform strategy and translate a global idea into
local benchmarks. This combines the scope of global executional
capabilities with the need for strategic excellence and central steering.
Four-Way Relationship
Usually, these local agencies have direct relationships with the
local client level, strictly regulated by a standard global client
contract: for example while local agencies are paid directly by
the local client, the local client is obliged to pay only for media
space and time approved through our global media management
system (“Fox”). With fiscal responsibilities on the local level, the
core of the transparency issue is solved: the planners simply never
touch the money.
True Procurement
Finally, we leverage the fact that media inventory can increasingly
be purchased not just from the originator of such media inventory,
but from a multitude of sources including trading units of agencies,
bartering companies and increasingly electronic marketplaces.
Instead of the client running a global pitch every couple of years,
CROSSMEDIA constantly (market and media type permitting) bids
out a client’s execution of campaigns, channels or disciplines among
a growing market of suppliers. Essentially, this turns the media
agency into a media procurement team firmly planted on the client’s
side: specifying the media needs in the first step, then ensuring it
gets purchased.
Client Benefits
So yes, an independent WorkNet beats the global network solution
offering three surprising and compelling benefits to clients:
Transparency
Media Procurement provides a structural solution for the
transparency issue, firstly by splitting planning from buying and
secondly by ensuring the neutrality of the advice: because those
who specify the plan simply do not handle the fiscal responsibilities.
“Market Price”
The Media Procurement Model systematically closes in on the
market price, because it regularly compares the prices of different
solution providers. The approach also holds much more flexibility:
in the event of an underperforming local agency, it is relatively
painless to replace such partner without risking the whole model.
Retaining Budget Power
Finally, because the media agency’s own financial interest in the
outcome of the media plan is completely neutralized, they can
once again act in the role of trusted business partner: their scope
is limited to specifying the client’s need, so that the clients gain
not only neutral strategy, but also retain the power of their
budgets usually lost in the pitch and award model.
To summarize, this new model combines the advantages of
the independent with the network solutions: the innovative
differentiating thinking of a smart agency partner combined
with the global scope in execution.
International Media Procurement is an approach designed for
clients concerned about the neutrality of their agency’s advice,
worried about paying too much and hating the idea that they simply
hand over the financial power of their biggest line item to an agency
they barely know or understand.