Which Way Next? was a summit for leading influencers from the media industry to share new thinking on the changing face of the client/agency and media owner relationships in the increasingly democratised and data-driven media landscape.

We had a fantastic turnout on the day, addressed by a panel of expert speakers which included:

Nigel Gilbert, CMO, Virgin Media
Geoff Seeley, Director for Global Media Innovation, Unilever
Justin Gibbons, Founder, work.research
Rob Horler, CEO, Aegis Media UK
Bruce Daisley, Commercial Director, Twitter
Jonathan Allan, Sales Director, Channel 4
Pete Robins, Founder, Agenda 21
Gurbaksh Chahal, Founder & CEO, Radium One

Some of the big issues of the day were around:

•  Operating models and remuneration structures
•  Evolving role and remit of the media agency
•  Moving beyond legacy media research and auditing practices
•  Access to talent and innovation
•  Managing data – assets and inconvenience

We also presented findings from our proprietary industry research, which focussed on collaboration models and the future role of media agencies. You can view the highlights here.

Feedback from the audience was exceptionally good. Here are just a few examples:

“Seriously good line up of speakers“

“Refreshing to see people tackling the agency model head on and no skirting the issues.“

“The insights from the speakers were good and refreshing.  They weren’t selling themselves, just focussed on the problems and opportunities.“

“The quality and honesty of the presentations were exceptional!“

Stay tuned for our next event!

Author :
Graham Brown
MediaSense
32 Percy Street, London W1T 2DE
D: +44 20 3005 6007 | M: +44 7771 755 789 | E: grahambrown@mediasenseinternational.com
Linked In | Twitter |www.mediasenseinternational.com|

True, the TV trading market functions extraordinarily well for many advertisers. Commercial impacts have been rising continually and TV prices are getting cheaper in real terms.  If advertisers are unhappy with their rates, they are free to change thanks to the portability of terms and the welcoming arms of the agency deal. For now, it’s a buyer’s market.

The TV trading market also suits most, but not all agencies. The Big 4 buying Groups are successfully exploiting their scale to salami slice value to attract more than their fair share of new clients. The evidence from financial commentators is that size is also delivering margin improvements through greater economies of scale and in leveraging advantageous media owner terms of business. Little wonder then, that two of the UK’s most successful independent agencies – MediaVest Manchester and Brilliant – put up the white flag this year and sold out to larger groups.

And what about the broadcasters? ITV’s resurgence in the ratings war has coincided with an altogether softer position on the CRR trading mechanism. Privately however, all the broadcasters are acutely aware that the large agencies have become too big to fall out with, and fear being subverted from impact “retailer” to impact “wholesaler”. Most media owners are looking hard at their own customer data as one way out of commoditisation, or are tentatively exploring a different kind of client dialogue.

Another influential contingent are the “policemen” of the ecosystem, the media auditors. But according to many observers, auditors are increasingly taking a softer line towards agencies by adjusting their benchmarks to accommodate more and more discretionary premia. This means virtually all clients can enjoy superior value against the “norm”, while the same clients may be handing bonus payments over to agencies which scarcely deserve them. As clients are increasingly able to measure business outcomes as a result of media placement, auditors, encumbered by legacy processes, now find themselves increasingly in a quandary about how best to advise clients on setting appropriate and relevant performance targets.

As we enter a sustained period of economic stagnation, media budgets and media owner income are set to flat-line. With media agency executives expected to generate growth in revenues and income, all ends of the media value chain are going to come under immense pressure.

Although OFCOM have delivered a clean bill of health to TV trading, there remain major governance issues around transparency, market power, and performance measurement on the horizon. Here are a few questions industry stakeholders should be considering in 2012:

-    Is it appropriate for agencies to increasingly trade on their own account and act as retailer to the media owner wholesaler?

-    Is it appropriate that advertisers spending more money on TV advertising have little or no leverage in gaining a price advantage?

-    Is it right that agency performance targets are set and measured by the same people?

-    Should loyal clients be concerned that their media agency is holding back value to award to more promiscuous clients?

-    Is innovation in trading and performance metrics being suffocated by the measurements which suit the commercial interests of auditors and buyers?

-    Should there be a clearer separation between media planning decisions and implementation?

-    What is the industry’s plan to replace audience research currencies, as advertising in other media becomes increasingly served, targeted and tracked?

-    Ultimately, is the industry value chain really helping to create a sustainable market, encouraging healthy competition and innovation?

On the current industry trajectory, we risk heading towards a destination where media trading morphs into a wholesaler/retailer model,  where clients and media suppliers are both required to increase their funding to maintain their terms, while less and less able to determine whether their investments are being efficiently spent.

Meanwhile, outside the broadcast ecology and eager to find a seat at the table, are the technology companies. Google and Microsoft are unleashing next generation entertainment hubs into the living room; Sky and Virgin Media promise targeting nirvana with addressable advertising pilots; Twitter and Facebook are being integrated into the vast majority of new TV sets.

The health of the media industry depends upon vigorous competition, trading innovation, and real accountability. Maybe it is the tech companies which can offer a better route for the industry to take.

Top 10 digital developments for 2012

1. Facebook to IPO

Expected in Q2 2012 and set to be the biggest technology IPO on record, raising $10bn and valuing Facebook at $100bn. So what will this mean? Will the role of investors lead to less focus on further development, acquisition and user experience, in favour of clawing back instant returns? Or will it in fact stimulate it? My guess is that it will most certainly stimulate it. Facebook has learnt a valuable lesson from Friends Reunited who, by prioritising the commercial over the user, initiated its own downfall. For Facebook, we could see the number of users reach 1 billion in 2012 and they have not and will not compromise that loyalty with a disrupted, overly advertiser driven user experience. Expect a host of changes and for the better.

2. Tablets taking over..

Although we have seen significant growth in the tablet market in 2011, driven largely by Apple’s iPad (c73% of the tablet market) and a series of flash sales e.g. HP Touchpad / Blackberry Playbook, 2012 is set for further acceleration with the launch of the next generation iPad and a suite of lower cost options, most notably Amazon’s recently launched Kindle Fire which is due to launch in the UK in Q1 2012 and expected to reach 15% of the overall tablet market.

Research conducted by QuickPlay Media revealed 51% of UK respondents had watched TV or a film on a tablet or smart mobile device. Coupled with the growth in simultaneous media usage, it presents a rich and vibrant environment in which to reach and engage consumers.

3. Connected TV

Recent weeks suggest exciting times ahead for the connected TV market in 2012. With Apple set to launch connected TV’s in 2012, Google’s Eric Schmidt predicting the majority of TV sets will include Google TV by the summer of 2012 and Microsoft’s recent roll out of the new Xbox Live experience, there is plenty room for optimism. Although there has been growth in 2011, it has been impaired by a combination of poor usability (Google TV a case in point) and a lack of clarity among marketers on how to approach this. A recent IAB report highlighted the appetite, with 85% interested in advertising opportunities but just 12% with a strategy in place.

Cross industry initiatives and new applications, which help marketers to make more informed and data driven decisions will help to address this. Take the recently launched social TV application Zeebox, which provides a platform to both observe and engage with consumers. From a measurement perspective, it may not be too long until we start referring to ‘social ratings’ alongside the more standard TVR’s.

4. Rise of m-commerce

m-commerce is widely expected to reach tipping point in 2012 following another year of exponential growth. Continued growth in smart phone/tablet adoption, changes in behaviour, i.e. more using mobile devices to research and make purchases and wider availability of transactional mobile environments, are the main contributing factors. Underlining this, eMarketer predicts a 73% increase in m-commerce sales ($11.6bn) in the US in 2012.

For marketers looking within, the challenge is to focus on the execution so that adoption is not stunted by poor (or lack of) functionality. In the UK, in 2011 QuBit estimated the loss of value to retailers to be in the region of £4bn, all due to poorly optimised mobile sites. It really is time to act, before it is too late.

5. SoLoMo…Po

Another year, another acronym! Let’s start with ‘SoLoMo’ –‘social’ ‘local’ ‘mobile’. Think Groupon, Foursquare, Gowalla etc. Following a somewhat precarious time for the category (modest results and delayed IPO by Groupon, and Facebook ditching their deals service), it may seem curious to feature this but it is the execution which has been poor, rather than consumer appetite, and this is likely to change in 2012.

The missing ingredient has been ‘personalisation’ (the ‘po’) which is something Facebook’s recent acquisition of Gowalla may set out to address. Combined with that, Google are set to launch their own assault on the market with a mobile check-in deals feature as part of Google+. What both of these have in common is a rich layer of social and demographic data which can be used to power the deal. From ‘we thought you would be interested in this’ to ‘your friends’ friend bought this’ presents a very exciting prospect indeed. 

6. ‘Crowdbuying’

Crowdsourcing was featured last year in my predictions on the back of a number of high profile campaigns in 2010. 2011 may have failed to live up to those expectations in the same form but there are nevertheless exciting developments on a slightly different tact. If crowdsourcing is fundamentally about ‘sourcing tasks through a community’, as opposed to specific individuals, you only have to look at the group buying and daily deals services, such as Groupon, Living Social and eBay to see the essence of crowdsourcing at play. Major retail brands such as Gap and Superdry are seemingly using these services to ‘crowdsource’ which products consumers are most likely to buy. Far reaching, highly effective and all in real time.

7. Rise of automation and real time

The transformation in online display media buying towards greater automation and data driven decision making is set to accelerate in 2012. The infrastructure and supporting talent has been established and both publishers and clients will start to take greater strides towards wider adoption of this technique. While previously supply and the quality of that supply has been a problem, this is set to change with more adoption (by content owners) and richer formats including rich media, video and mobile. Take up by marketers will increase but many will choose to tread carefully amid concerns over the quality of inventory, possible abuse of data and perhaps more importantly, the notion of agencies ‘trading on their own account’ and the accompanying lack of transparency.

For 2012, we estimate the automated buying market in the UK will reach 20% of the display market (to £200m), compared with an estimated 6% in 2011.

8. Paid social to continue to grow

Wider adoption, improved access to inventory (through self serve platforms and API’s), better analytics and a growing diversity of options is set to stimulate investment in paid social media in 2012. Aside from a post-IPO Facebook, watch out also for Twitter who, following the development of their UK operations, including the recent appointment of their first UK Sales Director (previous head of YouTube, Bruce Daisley), they will actively be seeking to grow their position and offering in the market.

Keep an eye out for social search which is set to become more advanced in 2012. The specialist social search engines such as Quora will continue to grow but importantly (and long overdue), we should see improved search functionality across Twitter and Facebook. Also, the widely rumoured launch of Microsoft’s social search service Socl.com (no release date as yet).

 9. ePrivacy – act before it is too late

The EU Directive on the use of cookies was implemented in May 2011, giving website owners until May 2012 to comply with the regulations. This may sound like a long time but it does involve rather significant implementational challenges and brands need to get on board sooner rather than later. There remains a worrying lack of clarity over what is required and the potential implications, but with reports suggesting penalties for not complying of up to “5% of the violator’s annual worldwide revenue”, the time to act is now. The quandary for brands is how to react so that they strike the right balance between regulatory compliance and usability.

10. Big data

Although the notion of ‘big data’ is not particularly new (in IT circles), in the marketing area it is widely being perceived as the ‘next frontier’, the movement from ‘fluff to science.’ So what does it mean? Essentially unlocking the intrinsic value stored within multiple sets of complex ‘big’ data. By doing this, the data becomes more accessible, more identifiable and ultimately more actionable. Data management platforms, e.g. Turn and business intelligence tools e.g. Tableau, MediaSense’s SIGNAL will help to facilitate this process and in turn lead to greater productivity and improved marketing effectiveness.

Exciting times ahead then!

After receiving more than 100 nominations for this year’s 30 Under 30 list the Media Week editorial team has compiled the 30 media professionals who best matched the criteria asked for. The list is a good representation of media agencies and owners with a sprinkling of clients and provides an insight into the future of the industry with many of the nominations exceeding what was expected of them for their age, while also demonstrating great entrepreneurial spirit.

The 30 who have made the list were chosen after demonstrating that they best met the following criteria:

•Greatest achievement in the media arena
•An example of problem solving for one of their clients
•What they hope to achieve in their jobs by the end of the year
•What contribution they have made to the media industry

This article originally appeared on www.mediaweek.co.uk on the 14th September 2011.

To see the article in full click here