Enth Degree

News & Insights

MediaPost

US online publication MediaPost recently provided a great article entitled “Media Agencies’ $25B Bounty For Change” (Tom Goodwin, MediaPost, 05.06.15) that outlines how the media industry is changing in light of new technology and consumer behaviour, and articulates why some media agencies are struggling to keep pace with the new dynamic marketplace.

Is your agency able to anticipate and solve the problems of tomorrow? Enth Degree can help you ask the tough questions to ensure your suppliers are poised to deliver best in class service and provide ultimate ROI. Call us to find out more.

Read the full MediaPost article here.

April 15An Article in The Australian on 27th April entitled “FTA Networks unite against GroupM” (Darren Davidson) opens with the statement that “The CEOs of the three main commercial networks have launched an unprecedented attack against the biggest buyer of television airtime in the country, warning WPP’s GroupM to stop talking down the free-to-air TV industry or face ­serious consequences in advertising negotiations.”  

It goes on to explain that … “the row has erupted weeks before GroupM thrashes out deals for the 2015-16 fiscal year to determine the share each network will get from an estimated $1bn annual budget. (GroupM) has questioned the cost of TV advertising, citing audience declines and cheaper alternatives like digital advertising. But the networks could offer more favourable TV ad rates to GroupM’s rivals, and give them first option on coveted ad spots in live event programming such as the State of Origin series and AFL grand final.”

 While this article needs to be recognised as a shot over the bow of the GroupM juggernaut by the networks as they commence annual group negotiations, it highlights a number of issues.

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shell game 2Recent events have brought to the forefront a raft of unfavourable media practices with significant consequences for both clients and agencies.  Unfortunately this is not a new concept nor limited to one agency.   It has been covered extensively in the trade press and also placed a spotlight on media auditors, client actions and media agency ethics.

Holding an independent position in the market, we have been exposed to these practices and developed our own preventative measures to what we would call “the shell game”.

That is, we know which shell to look under, and how to make sure unfavourable practices don’t happen in the first place!

Prevention is always better than the cure!  

What we would do…

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AdNews

AdNews has released a great illustration of critical issues behind the lack of Media Agency transparency and accountability.     

The Article “Ad Fraud uncovered and how it happens” (Pippa Chambers, AdNews, 10.2.15) provides a concise outline of potential fraudulent media activities.

It’s not to say that all of these practices occur at every Media Agency, however it is a good summation for any marketer to be aware of when engaging a Media Agency.  Enth Degree has identified a number of these activities for our clients and developed contracts to ensure they cannot be implemented on our clients’ business.

Enth Degree’s independence and attention to detail has enabled us to identify many of these major issues, have them rectified and then managed through a water tight Agreement. The article and themes identified stress the importance to have your media performance independently verified.  When was the last time you reviewed your media services?  Call us to find out more.

Read the full AdNews Article here.

All marketers need to understand the implications of this unacceptable accounting practice and identify how much it is costing.

The value identified through a simple invoice review can uncover tens of thousands of dollars of your media spend. 

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Media Suspense Account – What is it

Unreconciled credits, the difference between what the client has paid and what the   media company has invoiced, are put into a ‘media suspense’ aka ‘media hold’ account.

  • Newspapers, TV stations, outdoor companies don’t always get their invoicing 100% correct.
  • Not all spots will appear as planned on a TV Network,
  • A newspaper may place your ad correctly as booked on page 5 but fail to invoice your media agency for the additional page 5 position loading,
  • A radio station may put your ‘live read’ spots to air but fail to invoice your media agency for the live read talent.

The media agency has, quite correctly, invoiced you for the page 5 loading and the live read talent fees as planned, but a corresponding invoicing error has been made by the newspaper publisher or radio network.

These un-reconciled credits can be placed into an agency ‘media hold/suspense’ account to accumulate.   At the end of the financial year when the newspaper has still not realised its error, the ‘media suspense’ credit could be posted to the media agency’s general revenue.

Our media agency reviews have revealed that about one in three Australian media agencies run suspense accounting systems.   Some clients may have stopped this practice and claimed the credits, however some have no idea how much is at stake.

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How would you define “red tape”?  

One description is the “bureaucratic practice of hair splitting or foot dragging, blamed by its practitioners on the system that forces them to follow prescribed procedures to the letter”.

The term has been incorrectly used more recently when the industry discusses the ever increasing role of procurement in the selection of marketing services providers.

It is becoming a common label to challenge the activities of procurement and compliance services as a barrier to achieving client objectives.  However, what is the risk of cutting the “red tape”?

There are real cost implications in taking short cuts to due process. The involvement of a good procurement facilitator within the agency selection and management process, combined with third party industry expertise, can turn red tape into best practice process management.       READ MORE

enth-degree-production-agency-decouplingDecoupling production is not a new concept in marketing circles. Historically, the view was that clients could control cost, service levels and output by forming independent relationships with production partners, outside the control of their “master” or lead creative agency.

This model allowed the lead agency to control strategy, creative platform and concept, while the production agency focused on the “churn and burn” pieces. It was the original “conscious uncoupling.”

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DSPs (Demand Side Platforms) are automated booking software systems for the purchase of online ad space/inventory.  They are automated campaign tracking processes.

There are many positives:  access to a significant amount of centralised online inventory, managing multiple messages and using a wealth of consumer data (with a question mark over data ownership) – all to find your consumer in the digital haystack.

But this black box comes with its own mysteries.

 

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“We sourced the best price for you”… “We’ll provide you with a reconciliation of resources used”… “We’re losing money on this”…

Sound familiar? These are some of the more common phrases we’ve heard from agency folk recently, via their clients. Designed to make marketers feel comfortable with the agency investment, they don’t always represent the truth. This is why consultants like us are called in for benchmarking, compliance, and value review services.

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When asked what differentiates Enth Degree recently, the response required no delay…”unashamedly client focussed”.

Someone needs to be, because it seems this simple business ethic is lost on many of marketers’ communication “suppliers”.

While in industry circles it is more acceptable to refer to agencies – be they creative, media or other – as a client’s partner, this is a relationship based on trust and earned over time.

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