Vox Pops: More on the ANA report fallout

"The ANA report on agency kickbacks points to the poor state of agency/client relationships. It’s natural for marketers to want to get a “good deal” out of an agency, and agencies naturally want the upper hand for themselves. This inward focus on ROI has led to a scenario where both parties have to be dishonest with one another. No good has ever come out of a relationship with dishonesty at its base! A way to move forward may be for both sides to reassess value and worth, one agency/client relationship at a time. For example, in the pitch and negotiation process, agencies need to address questions like: “What is our value proposition?” “How will results be delivered?” “How will we measure and demonstrate success?” While marketers might need to focus away from getting a bargain to possibly paying more for good and honest work."

Patrizio Spagnoletto, CMO, SteelHouse

“The findings from ANA are not surprising and neither is the reaction from the industry, but it is important to separate the issues. The fact that agencies are receiving rebates is not the issue. The practice is common in most other markets and is part of negotiation tactics that happens in several industries. The issue is the lack of transparency in the pricing structure around media. Brands today have no insight into how much of their budgets goes towards the actual media buy vs. fees to the agency and while that model was acceptable in traditional channels, it is not in digital, where inventory and pricing is disclosed by both publishers and ad networks. When an agency doesn’t disclose their margin (which tend to hover at around 40% per cent it becomes insult to injury to hear they are also receiving rebates. The industry has to 1) change to a more transparent model and 2) agencies need to shift their model beyond just media buying or clients will continue to take their budgets directly to the publisher.”

Hector Pantazopoulos, CRO SourceKnowledge

"Agencies demanding rebates as a precursor is nothing new. This problem is most widespread in awareness and brand campaigns, which are already difficult to correlate to a return on ad spend. The absence of measurable campaign goals fosters a lack of transparency that is all too commonplace in the digital advertising industry. In today’s digital landscape, most brands have the ability to take marketing and media buying in-house instead of relying on an agency which will result in a significantly greater level of transparency as they are not forced to rely on a proxy. By using programmatic DSPs and focusing on performance campaigns, advertisers can bypass the most questionable areas of the digital advertising industry.”

Tim Barnes, chief product officer, AudienceScience

"The ANA report only further confirms that parties within the advertising ecosystem aren't operating on the advertiser's behalf anywhere near as often as they should. While so many recent headlines have focused on the trouble of online ad fraud and non-viewable ads, the truth is that budget waste is rampant throughout the chain between advertiser and consumer. We're about to enter a period where nearly every dollar spent by advertisers will come under great scrutiny. The agencies that integrate transparency across every level of their organization – whether that’s through accounting or technology use – will stand apart from the pack. In order to continue receiving budgets from the Fortune 1000, every player in this ecosystem will have to demonstrate that they are working in their clients' best interests. Agencies and technology solutions with a long track record of transparency and accountability stand to benefit the most."

Greg Raifman, president, Rubicon Project

"'Trust but verify' captures the lesson we should take away from the ANA study released this week on the state of relations between the world’s biggest and most influential brands and their advertising partners. The report highlights the need for us to finally close the chapter on the old advertising models that made sense a generation ago but are no longer applicable in a market seeking transparency at the speed and scale our digitally connected ecosystem now demands. In a nutshell, the ANA reports seeks greater transparency and a verifiable degree of trust, offering a clear call to action for our industry to fully embrace the evolution to transparent advertising automation. The core architecture of programmatic advertising lends itself to seeing and understanding who adds (and who subtracts) value from the media trading supply chain. Transparency is engineered directly into the architecture of programmatic advertising. In addition, the move to automation helps to address critical issues of viewability and fraud. The report reminds us once again that the time has come for everyone — brands, agencies and technology providers to demand greater transparency, to embrace the power of automation and to ask the tough questions of every partner to ensure value is being given rather than profits simply being taken."