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UK poster boss Alastair Lines hits out at barter companies’ commissions and market distortion

More strife has emerged in the ever-interesting UK outdoor industry with Alastair Lines of Canary Wharf Media accusing industry trade body the Outdoor Media Centre of overplaying the benefit new digital sites are bringing to the wider industry, neglecting the promotion of traditional outdoor formats (still the vast majority) and including what he calls the “vast commissions” of barter companies (who, he says, bring little revenue to the industry) in its revenue figures.

Barter companies trade surplus or slow-selling inventory from the likes of hotel, meetings, technology and even car companies with media owners who may use it for their own purposes (hotel expenses or fleet cars for example) or use it in viewer and reader promotions. The big marcoms companies like Omnicom and WPP have moved into this area as intermediaries recently, striking deals for their clients with barter specialists Active (the world’s biggest), Asus and Miroma.

Lines (a former MD of interpublic-owned poster specialist IPM) also criticises the OMC and its boss Mike Baker for failing to deliver the long-awaited new Postar research measurement system which he says has cost “tens of millions of pounds” and which won’t measure the effectiveness of his indoor panels anyway.

Some industry critics contend that Postar has been delayed because of objections by the global big three outdoor companies, CBS Outdoor, Clear Channel and JC Decaux. Decaux is said to think it under-estimates the worth of its vast ‘street furniture’ site holding (bus shelters and the like).

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Lines’ objections were triggered by yesterday’s release by the OMC of Q1 UK outdoor revenue figures which showed revenue of £213m, up 3.1 per cent year on year. The implication is that these figures are misleading in terms of money coming into the industry as an increasing amount of it is going in commission to barter companies.

Here’s his memo to the OMC’s Baker, copied to all OMC members apart from CBS, Clear Channel and Decaux.

Hi Mike

I know this is a press release but how about some underlying numbers for those of us in the OMC?

It’s all very well talking up the medium but we all know in the most part this growth in digital is down to new sites and at best will flatten out as we proceed.

The yield on traditional formats has declined to such an extent that we are being offered rates which I was paying as a buyer in the 80s, on top of that we now have the inclusion of ridiculously large commissions for barter companies who as far as I can see have brought absolutely nothing to our medium.

I am investing what for me is a huge sum of money on new and improved inventory yet I get barter companies telling me that unless I pay them I will be off the schedule, no mention of audience, quality of display, or media value, in other words POSTAR is irrelevant, although incidentally none of my panels can be assessed via POSTAR anyway because after tens of millions of pounds we as an industry still can’t measure the audience which sees an indoor panel.

So I’m sure all members would like the numbers broken down in as much detail as possible which will enable us to see the reality of the situation, and hopefully act upon it, as in my view we have allowed ourselves to be dictated to my hugely profitable advertisers, and in doing so have severely undervalued our medium.

Many thanks

Alistair

Last year the UK out of home industry was given a clean bill of health in an Office of Fair Trading investigation, to the bemusement of many industry participants.

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