On this week’s #MediaSnack, Tom and David get excited about “change” – the ID Comms Media Word of 2017 (in 2016 it was “control”).
The central change they predict will be those made by many advertisers in the way they manage their media investments and work with media agencies.
Tom and David detail three key areas of change in 2017:
Firstly, advertisers – Tom and David expect to see a significant change in the internal narrative around media, from a cost to be managed downwards into an investment in growth. Advertisers will continue to take more control of media decisions, define a clear vision and ambition for media investment, set proper KPIs for media performance and focus investment against driving business outcomes.
This will be a huge change as advertisers who may have neglected their media budgets for years start taking it seriously again and redefining media as a powerful lever for growth and a critical part of marketing success.
The last piece of the jigsaw will be change in the relationship between marketing and procurement, we expect a change of internal narrative around media to drive far closer alignment between marketing and procurement stakeholders, which will have a very positive impact on media being seen as an investment in growth and the media agency as a strategic partner in success rather than a commodity supplier.
Secondly, agencies – media agencies will undergo more change in 2017 than they’ve ever faced, driven largely by the changes in brief and scope issued by marketers. The most significant pressures will come from the big media pitches of 2017, as these tend to create the huge tectonic pressures needed to remould the media agency networks.
The more strategic pitch briefs – rather than the clumsy, race-to-the-bottom eAuctions – will define a new blueprint for the media agency model, asking them to engineer their resources more specifically around marketers’ new requirements.
We expect media agencies in 2017 to be more open to defining partner relationships with advertisers, aligning to the same KPIs, working to performance-based payment models and offering greater financial transparency. This, in turn, could have a huge impact on the shape of media agencies, perhaps shifting away from ‘buying giants’ leveraging scale to secure cheap pricing, to be more objective, strategic consultants.
Making this change will require media agencies to be very transparent about their business model, as it’s impossible to be wholly objective and neutral if your income is derived largely from the buying of certain media.
Thirdly, accountability – we anticipate big changes in how media investment is held accountable. This year, 2017 could be the year when metrics for media become more rationalised, with more standardisation and consistency.
Accountability is the thread that will link the changes in advertisers with the changes in media agencies, as both parties become more accountable to the CEO, CMO and CPO and have to demonstrate how media investment is driving a business outcome.
This pressure will, over time, change the media market from its current focus on cost, price, discount and auditing to a new focus on value, growth and performance.