Tag Archives: media agencies

A Boon For Hulugans, Streamers and Cord Cutters

Today’s content is written by Alexa Paradis

Hulu has always been a leading force in the streaming age, differentiating itself from Netflix by offering current seasons of network shows in addition to their vast library of shows and movies. This made them the perfect match for cord-cutters who wanted immediate access to new episodes of their favorite shows. On May 3 during their 2017 Upfront, Hulu announced that they were now offering a live TV subscription that includes over 50 channels to start that will grow over the current year. The current channel offerings include all 4 Broadcast networks, all major sports networks, 5 children’s networks along with the Scripps channels just to name a few. This package will not replace their normal streaming subscriptions but instead be an add-on for customers that will cost $40 per month and also come with the ability to stream on multiple screens at once, quite less then the average cable bill. “Hulu can now be a viewer’s primary source of television,” said Hulu CEO Mike Hopkins. “It’s a natural extension of our business, and an exciting new chapter for Hulu.” As a millennial that cut the cord once I moved out of my parents’ house, I would definitely consider adding this onto my normal Hulu subscription especially if it means I can be watching the new episode of Scandal while my boyfriend watches the Yankee game in the other room.

For advertisers this means even more inventory on Hulu, in addition to their 32 million viewers who opt for ad-supported content advertisers now have access to the standard 2 minutes of local breaks per hour on cable networks. Also announced was a new deal with Nielsen, Hulu said advertisers will have access to Nielsen’s Digital Ad Ratings (DAR) across connected-TV devices starting in the fall of 2017, to provide a validated measurement solution across screens. Another amazing new feature for advertisers is the launch of T-commerce interactive ads in partnership with BrightLine that will let subscribers purchase movie tickets through their connected TVs. The on-screen purchasing capabilities will expand to other categories like retail and quick-serve restaurants in 2018.

Aside from the exciting announcement of the live TV subscription Hulu touted their extensive release schedule of original programing for this year with all of their biggest stars stepping on stage to share their excitement. Stars of the instant hit “The Handmaid’s Tail” announced that not only did they have the most streamed series premiere on the platform out of original and acquired series but they have already been green lit for a second season. Other exciting original series announced were Marvels “Runaway Teens”, Mars mission drama “The First” from House of Cards creator Beau Willimon, Seth Rogen’s project “Future Man”, Sarah Silverman’s political comedy series “America, I love You”, “The Looming Tower” which will star Alec Baldwin along with the series finale of “The Mindy Project”.

A powerful moment took place when Mindy Kaling took the stage for her last upfront and thanked Hulu for being a place that all types of women can be showcased and celebrated, which is not something you can find in many types of entertainment today. This certainly sets Hulu apart from their traditional network counterparts as a way to connect with Millennials who place a high value on inclusivity of all types of characters, especially female ones.

This year’s upfront showed that Hulu is remaining vigilant in their quest to be streamers go-to service and advertisers go-to platform to reach a diverse and highly engaged audience. The company shows no signs of slowing down their innovation either.

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When Walking Away Is The Right Decision

I hate walking away from prospective business, but a recent situation made me realize that sometimes that is the best outcome. A few months ago I received an inquiry from someone purported to be a consultant who was given our name through a mutual business friend. She was looking to bring in a new media agency for a small HBC company. The brief she sent focused on two objectives; reduce the agency fee and improve the media efficiency (she meant to say lower the CPM because media efficiency and media cost are not the same thing).

I scheduled a conference call with her and one of my key people, while on vacation, to discuss the project and see if it made sense for us to participate. We opted to go forward and had an in-person meeting with the consultant the following week. As she briefed us it became clear that she was asking for spec work, a fully fleshed out media plan—read my prior post on this subject here http://wp.me/p2edMw-2s

There is a certain amount of spec work I am willing to do in a new business pitch. Anything more than that I ask to be paid for. In this case I asked for a “go-away” fee on the work if they did not hire us. It’s an interesting approach in that often times the work is good enough that it forces the prospect to hire us or pay two agencies. The problem here is that we wanted a lot more than the prospect was willing to pay. They did not put the same value on our work as we did. Our ask was 10X what they were willing to pay.

We settled on an intermediate number, but I insisted that it be only if the client agreed to our ongoing fee structure. It made no sense for us to continue if the client wasn’t intending on paying us the compensation rates we wanted. The consultant danced around the commitment and kept insisting that we needed to do the spec work and the fees would work out. Red flag number 1.

Red flag number 2: the consultant asked us to break out our fees for planning and buying separately because she wanted to manage some of the buying herself. Apparently she had a relationship in the :10 TV unit space and wanted to be more than the consultant. She was going to push for the agency that allowed her to maintain this position—and likely the one who planned the most :10’s.

It was then that we decided that we did not want to pursue the assignment because there would be a lot of spec work, which even if they did not hire us, would benefit the consultant more than the client or us.

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The Dark Side of Programmatic Buying

Programmatic digital can be dicey when it comes to getting what you paid for and you should be concerned about fraud, bots, safety, and viewability issues that result in bad outcomes.

A few months ago a prospective client asked me to evaluate a small programmatic buy her agency had executed for her with one DSP. The agency thought the buy was great, given that they drove a CTR of .48%, higher than most campaigns with a CPM of $1.40. On the surface I would agree.

That is, until I looked at the source of clicks report. This was a small enough campaign, just under 10,000 clicks, that a simple scan of the source of the clicks made me question the real value of the campaign. Many of the URL’s were from out of the US (Belgium, Brazil, Malaysia to name a few) but his was supposed to be a US campaign. Many were from sites that I could not load if I tried. Many seemed to be legitimate sites, but the visits were very low quality and very brief. The average session time for clicks from this DSP was 1/3rd to 1/4th the next lowest referrer. Average page views were even lower.

I sent the source of clicks list to a third party fraud and safety expert for their opinion. About 50% of the clicks were “High Risk” for fraud and another 5% were “Suspect”.

So if this is true, the client’s CPC for real clicks just doubled, at a minimum. Since I knew which DSP was used I asked them for their opinion on the third party auditor’s findings. I was shocked at the response from the DSP salesperson; we take brand safety very seriously and we’re more than happy to deliver on any parameters mandated.  Normally, during campaign negotiations we need to know in advance if a campaign is being measured by a third party and we’ll set up with daily reporting so that we can optimize out of those placements, sites, creative, and or content driving fraud.” 

Let me translate this for you. He said that if they knew we were going to look at a third party safety audit that they would not have delivered those impressions. Want to know what was worse? The CEO of the DSP echoed the same sentiments when I raised the issue up the line.

Fraud and bot clicks are going to happen. Clients and their partners who focus exclusively on getting the lowest CPM or CPC will find that they are actually paying more than they think for real inventory. Use a third party verification service for your campaigns, even if it is just to keep the people you’re giving money to honest.

For more info go to http://www.ocdmedia.com

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Is Your Marketing An Investment Or A Cost?

Never underestimate the importance of goal setting and strategy in media. While smart media buying will save you money, smart media strategy will make you money. Without a well thought out media plan you are not getting the most from your budget because you have not determined what you should buy and what you should not. While what you buy may be priced well relative to other options, buying the wrong media is wasteful no matter what the price is. And all too often advertisers and their agencies let buying lead the media process or are missing the connection between the plan strategy and the buy.

Would you use an investment strategy of buying only stocks that are less than $10 per share? And would you use the broker who charges the least per transaction because all he has to do is tell you how much of a given stock is available when you are ready to buy? Or does this sound crazy to you? It is crazy. But what’s crazier is that some companies handle their largest investment, advertising media, in this manner.

This approach is designed to limit your costs, but what you may not know is it also limits your return. Successful media buying, much like having success in the stock market, depends on good research and good timing because the basis of both is supply and demand. The biggest difference is that media buying is more negotiable than the stock market, an extra level of complexity that ultimately determines how much you will pay for your ad time/space.

And negotiating is something large media buying agencies on the whole don’t do as well as their smaller sized competitors. “How can this be?” you ask. “My agency buys gazillions of dollars of ad time, they have to get better prices than the agencies who buy less. It’s simple math. You buy more you get a better price.” Remember Lucy and Ethel in the chocolate factory in that classic “I Love Lucy” episode? That is what being a media buyer in a mega-media agency is like. You don’t have time to “wrap” the schedule properly because you have three more buys to get on the air that day.

Negotiating is about give and take, a certain back and forth. If you’re using one of these big guys chances are you’re not getting the best price because the buyer cares more about getting four buys on the air, and less about buying the right inventory. It’s easier for them to only buy the lowest priced stuff because they don’t have to worry about value. But you should because your media buy is your investment in your brand like your stock portfolio is your investment in your retirement, not an expense on your P&L.

Smart media planning let’s you know which media does and does not make sense for your efforts. It helps tell you which media to stay away from. Buying the wrong media because it’s cheap is as wasteful as buying premium priced media that isn’t right for you. Neither one will produce results.

An approach that recognizes the importance of strategy means targeting the right people at the right time, yielding a smarter use of your marketing resources. Make it easier for a buyer to buy effectively because they know the difference between price and value.

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Who Is Minding The Store

The marketing world is being turned upside down. There are as many as 25 major media reviews going on right now, as I wrote about in my last post. There are many theories as to why; Is it the agency kickbacks/rebate issue? Is it about service pricing? Is it about getting better expertise? Any one of these is legitimate enough and I’m sure there is a mix of reasons. For the agencies the impact is tremendous. Whether it’s to retain or acquire the account the resource dedication for a pitch of this magnitude is huge.

I’ve run new business and worked at more than one of the agencies involved in these pitches. Dozens of people, freelancers hired to help, weeks and weeks of late nights and weekends. This isn’t done in someone’s spare time, because they have none. People are working on the pitch throughout the day and into the night.

So what does this mean to existing clients? One unintended consequence of these reviews is the labor shortage it creates on existing clients because all hands are on deck for these pitches. It means someone who is supposed to be working on your business is not. It means the junior people are doing more of the work because the senior people are involved in the pitch. It doesn’t mean total neglect, it means inattentiveness to everyday matters. And that’s when mistakes happen. An assistant sends an incorrect IO to a media company. A cancellation order doesn’t get issued. A decimal place is off on a CPM and a plan is totally miscalculated. These things happen and they usually happen when people are forced to choose where to devote their time.

Also, in every new business pitch these agencies are being asked to show the organization chart if they win. No one shows empty boxes. They are promising your people to the new client. Don’t be surprised to find out your favorite person is being reassigned.

If your account is at one of the agencies involved in these pitches pay close attention to how many mistakes happen during this time. Pay attention to who is/isn’t involved everyday. It will give you an indication of how important a client you are to them.

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Buyer’s Remorse

A new CEO comes in, ousts the CMO and VP of Marketing and tells his smaller media agency that he won’t renew their contract because he has a larger media shop he’s worked with and believes their BS about bigger agencies always buying better than small ones.

This happened to us recently. When the CEO’s preferred media agency submitted a ridiculously high compensation proposal suddenly we’re back in the mix. Our fee proposal was very fair. We even offered the client a better deal. We get an opportunity to pitch ourselves to the new CEO who, for the previous two months, wouldn’t even acknowledge our existence.

We have a great meeting. We explain the fallacy in believing that larger agencies “always” get better pricing. We tell him you get best pricing (and overall work) from people who care about their work and have time to do a great job for you. They take the time to negotiate for value and continue to drive down costs if they can rather than stop when they reach the benchmark. Sometimes those people work at bigger agencies, but more often they work at smaller ones. He mutters on his way out “that was a great meeting”.

We have the support of the marketing team, the research team and the field marketing personnel who all lobby for us to be retained. The CEO asks us to submit pricing on a prototypical buy in 50 markets. We bought those markets the prior year so we used our actual achieved costs. The CEO hires his preferred media agency. We’re disappointed, as we should be. We felt we had a chance. We believed we won the CEO over. Then we felt used simply so he could get a better compensation deal from the agency he hired.

A month later one of the marketing managers calls us to ask how we got our media pricing because the new agency can’t meet those costs. Why weren’t they asked to submit pricing on the same prototypical media buy that we were asked to? The CEO could have hired the better agency if he held them to the same standard throughout the process.

We get more calls asking us to meet with the new agency to tell them how we achieved the costs we got. We outright refuse and offer to handle the business instead. “Hire us and you’ll get those costs”.

Now the CEO has a recruiter calling one of our senior people to ask him to interview for the head of media position. Our guy says to the recruiter “If he respected me so much and wanted me working on his business why didn’t he hire my agency?”

He wanted a larger media agency. He got one. Be careful what you ask for. You just might get it.

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