With an estimated $578 billion (source: Zenith) invested globally on media, deciding on how and where to spend budget wisely is of significant strategic importance to thousands of brands around the world. Those responsible for managing media investments understand their job is growing in complexity and becoming increasingly business-critical. We believe there are 6 key trends to keep a close eye on as you plan your 2018 media activity:
1. The digital supply chain will move more rapidly towards a disclosed model.
The over-supplied and opaque ad tech industry took a real beating in 2017. At the turn of the year there are legions of ad tech people out of a job, a visible sign that the ad tech industry is consolidating and margins eroding as brands, agencies and the media owners are finally repatriating more of the value previously siphoned out of the supply chain. “Disclosure” (we prefer this to the rather over-used “Transparency”) is gathering momentum as platforms, DSPs and trading desks are aligning towards fully-disclosed models, which enable brands to assess the true value of the inventory, data and technology within their media buy. There is still much to do, but the tide has irrevocably turned and the digital ecosystem will end 2018 in a far better place than it started 2017.
2. The technology giants will concede responsibility – at last.
Hiding behind the claim that they are merely technology companies doesn’t wash with brands and consumers anymore – all communities need law and order. YouTube and Facebook may be unable or unwilling to prevent offensive content from coming onto their platforms, but they are totally capable of – and accountable for – stopping branded content appearing next to offensive content. Advertisers and their agents need to remain strong and principled here, allowing no respite for these two horsemen in cleaning up their systems and processes. In 2018 there will be real progress on Brand Safety, the marketer’s ‘greatest nightmare’ (as referenced in Media2020: Refresh)
3. It’s the beginning of the end for media’s long tail.
As brands demand more visibility and safer environments, it is inevitable that quality content and premium publishers will prevail. The heat will come off the programmatic market, and brands will start planning vendors off the media plan which are not able to meet the requirements of a disclosed media ecosystem. This means planning to buy a shorter tail, as more brands lean into the digital supply chain and filter their media schedule more actively. At MediaSense, we advise brands to adopt a Compliant Impression policy with their agencies. This puts brands in control of their own quality standards, improves buying efficiency (as non-compliant impressions aren’t paid for) and enables media owners which provide quality and disclosure to capture a larger share of budgets.
4. Media agencies will innovate in the war for talent.
More and more media agency top talent is exiting the agency world for new and better-paid roles at technology companies and management consultancies. The problem agencies face (as never before) is the loss of people in leadership positions AND in specialist roles. We are not among the doomsayers forecasting the death of the media agency – in fact, the role of a media agent is more important than ever in a more complex media ecosystem – but agencies are losing intellectual firepower and this is becoming their next big problem. If brands start to listen to alternatives for advice on how and where to deploy their media investments, the media agency regresses from a communications partner to a trading platform – a one-way road to oblivion. Agencies will fortify their IP by aggregating their best business planners and researchers into more agile and focussed units and diversify into new sectors such as Voice, AI and VR in 2018.
5. Brands will exercise their right to choose and experiment.
As the media agency networks grew in size but diminished in customer-centricity, brands lost control. Now brands have what they wished for – a more competitive market. More agile and leaner ways of working are flourishing as technology continues to flatten barriers. Yet the alternative offerings of the management consultants and the new independents still provide only partial and localised solutions rather than complete substitution. So, brands will seek to in-source and in-house more of their agency capability and will break pieces off their scope of work in order to experiment with more diverse media organisational models. As the MOM (Media Operating Model) becomes the hot topic exercising most clients’ minds, this will elevate many media reviews in 2018 to enterprise-level status.
6. Data-driven operations will be an obligation, not a choice.
In this year of GDPR, all European organisations are having to up their game in terms of operational integrity, by policing data, risk and compliance far more proactively. For brands, this means adapting to significant changes in marketing systems, skills and structures. As any senior executive knows, when you become a data-driven business, you require all your suppliers and partners to act in the same way. So, agencies will have to demonstrate to their clients that they have consistent data-driven processes and transparent and professional standards. The forces making brands become more customer-centric are exactly the same forces which will compel media agencies to become transparent and more efficient, and in due course will result in media being planned and bought on merit rather than on convenience.
This brings us back to where we started – the forces of data and disclosure are blowing through the whole media ecosystem and changing how business is done, how media is valued and how relationships are managed.
As the media industry enters a new accountable phase in its evolution, the organisations (media agencies, auditors and advisors) best placed to advise brands on media are those which embrace the principle of disclosure; take full responsibility for their product; prioritise quality over cost; attract and retain the best people; and marry deep technical expertise with data-driven operations.