An agency pipes in
I've suspected some agency folk are lurking around. One finally pipes in with the comment that I republished below. Now of all the offensive statements that have appeared in this blog, I'm somewhat surprised that what cranked this contributor was a comment made by a small magazine publisher who believes that it's the agency compensation model that keeps them from recommending smaller titles.
Personally, I agree with the agency person. Compensation is the furthest thing from their minds - they simply want to perform well for their clients. Otherwise why bother negotiating lower rates? They end up spending time negotiating and then more time reinvesting savings in other magazines with which they have to negotiate again while earning the same compensation for investing the ad budget. While it is extra work justifying a small magazine on a media plan, it is the creation of a unique, intelligent plan that makes the job fun and challenging. Adding interesting, appropriate small magazines can make a plan shine. A client does not an agency to buy three pages in Chatelaine, three pages in Canadian Living and three pages in Reader's Digest. A monkey can do that.
On to the comment:
Personally, I agree with the agency person. Compensation is the furthest thing from their minds - they simply want to perform well for their clients. Otherwise why bother negotiating lower rates? They end up spending time negotiating and then more time reinvesting savings in other magazines with which they have to negotiate again while earning the same compensation for investing the ad budget. While it is extra work justifying a small magazine on a media plan, it is the creation of a unique, intelligent plan that makes the job fun and challenging. Adding interesting, appropriate small magazines can make a plan shine. A client does not an agency to buy three pages in Chatelaine, three pages in Canadian Living and three pages in Reader's Digest. A monkey can do that.
On to the comment:
How about an agencies take on this thread. I find the comments about agency compensation to be far from the truth, let alone fair. Regarding the comment “agencies only wanted to deal with high cost media…” , if that were true, magazines would never even make a media plan. Heck I could burn through a $10 million budget in 5 minutes just on TV.
Secondly media or even vehicle selection has nothing to do with compensation levels. The original “commentor” states “the way agencies are paid…” I’ll assume you are referring to a commission basis. Let’s assume that archaic compensation system is still common across the board, it would make no difference if I went with high cost or low cost medium. If the agreed upon rate was 5 points, it doesn’t change with what I buy, it’s still 5 points at the end of day.
Finally smart agencies do not work on commission anymore. If they do it’s a small portion of their compensation package. Retainer Fee’s provide a more stable revenue base and better reflects the cost of actually running a clients business.
posted by Reptile at 11:47 AM
0 Comments:
Post a Comment
<< Home