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hemes The topics that need to be discussed ■ LAST YEAR’S LEGACY
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WRITER Martina Lacey
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June is the month that the industry has earmarked as the start of the recovery proper. But the bad news is that everyone in the media food chain, big and small, remains at risk, and are still in for an uncomfortable ride. As a media agency ‘uncomfortable’ means it might be near impossible to keep good on the promises made in 2009; as a media owner it means spending the next 12 months fighting over media pricing; as a client it means probable disillusionment along the way. Pre-Lehmann
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The market is clinging on to hopes of a smooth recovery, but every single part of the industry remains at risk. The industry has a lot of clearing up to do, a lot of promises to make good, and a lot more challenges to come
of possibility,” says one senior agency head. “There are several cases where you wonder how they are going to deliver what they promised. Agencies need to get more backbone.” If deals come unstuck, agencies
“Media agencies
Brothers, the media landscape already nursed a broken and poorly patched-up model. Remuneration was a mess and the role of media agencies had become blurred. How agencies went about winning business is a sensitive topic. Unsurprisingly, few want to own up to the rumours of over-promising that took place. “People know that they have made promises against the realms
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are like alcoholics; they need to change, want to change, are unwilling to change, impossible to work with”
could quite rightly end up in court, but the lengths they will go to before that happens will put them under pressure for the long-term. From a client’s point of view, what is likely to suffer most is quality. The sole emphasis on cost meant that planning and strategy took a back seat last year. Add to that severe cuts to agency headcount – frequently on the comms planning side
– and clients are likely to get
what they paid for. One insider says: “Who cares if you got the media really cheaply when the campaign has no thought behind it?” If things continue as they are, we are seeing the next phase in the protracted death of the media agency identity. The
increasing number of holding company deals pays testament to this, as it is the holding companies that can absorb poorer margins for specific clients. Not all of it will be returned through economies of scale. With price the ongoing concern, agencies have only themselves to blame when they gripe about the commoditisation of media, and a marketplace with only five big players is in nobody’s best interest. To use the analogy of someone
who prefers not to be named: “Media agencies are like alcoholics; they know they need to change, want to change, are unwilling to change and near impossible to work with.” So how does a client work with a media agency nursing a lifelong hangover and bad credit?
AT WHAT COST BUSINESS? Advertisers are no different from anyone running a business. Last year they were looking for cost savings and media was often high on the hit list. Yet agency reaction was still surprising. One consultant refers to a recent pan- European pitch in which his client gave the agencies a number and asked them to come back with the closest offer.
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