A new report by media strategy firm Ebiquity has found that Australian advertisers can get as little as 40 cents of actual media for every dollar they spend.
The findings of the report, published on The Australian today and to be presented to an Australian Association of National Advertisers (AANA) conference tomorrow, highlight on ongoing issue in Australia’s media landscape that a long list of players are “taking a cut of the ticket” when it comes to media spends.
It’s been reported that Ebiquity’s research found that as much as 60 per cent is being sucked up by agencies, who, worryingly, can’t vouch for the rogue monies. However, the biggest culprit appeared to be the programmatic purchase of digital advertising.
Nick Manning, Ebiquity’s chief strategy officer, told The Oz: “From advertisers’ perspective, they pay $100,000 for a campaign and only get $40,000 of media. Then the problems start as viewability and fraud reduces even this by roughly half on average, so the $100,000 actually equates to $20,000 of useful media,” he said.
The AANA has been one of the more aggressive industry bodies in attempting to get more transparency in media buying in Australia. The AANA works for the actual advertisers and not their agencies. In particular, it has petitioned the likes of Facebook to have more third party verification for its data. In late 2016, Facebook found itself in trouble after grossly misreporting its audience numbers.
Ebiquity’s findings appear to mirror a worrying report into US media agencies released in June of last year. The report by the US Association of National Advertisers found evidence of a “fundamental disconnect” in how agencies and advertisers view their relationship and “systemic elements” to some non-transparent business practices outlined in the report, some of which senior executives are aware of or mandate.
Other findings included mark ups on media sold through principle transactions ranging from around 30 to 90 per cent, with media buyers allegedly being pressured or encouraged by their agency holding companies to direct client spend to them regardless of whether it is in the clients’ best interest.
Commenting on the US study, the AANA’s CEO Sunita Gloster said at the time: “Any best practice guidelines or initiatives that emerge are likely to have universal application, so we will aim to share them with our members here.
“Whilst the US report reminds advertisers to remain vigilant, it is important that we remember these principles of transparency, disclosure and fairness are central to the reputations of all parties involved. Equally importantly, adherence to these principles is crucial to achieving our common goal which is to show the link between advertising and business growth. Businesses need to have confidence in the integrity of their media spend allocations,” she said.