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Friday, 14 Jun 2024

Market Forces & Media Buying Automation

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No matter what industry you’re in, meeting frequently with a lot of vendors and salespeople just isn’t feasible. The amount of time spent in those meetings could be otherwise spent growing a business or keeping customers happy.

It’s no different for small businesses placing local advertising.  Meeting with hundreds of media salespeople can be costly and confusing. So what do you do? Either you don’t meet with them, or familiarity and bias leads to meeting with only selected media salespeople, no matter the changes in the advertising landscape or media consumption habits of the audience you want to reach.

The local advertising marketplace changes rapidly for both   traditional and online media—rates fluctuate, inventory availability changes, and new formats and advertising packages are introduced every week.

Small businesses have two options--buy media on their own (“in-house”) and commit a lot of time and effort in order to create ROI in their advertising, or hire an ad agency to keep up with market changes and place effective, measurable advertising that increases visibility and generates sales.

Margins, Media, & Market Forces

Even in the second option, the core challenge remains—the ad agency has to deal with those market forces and fluctuations, too.

How agencies deal with this problem affects how they get paid. Ad agencies generally get paid when your media runs, and only if it runs. Every bit of research or data they spent time on or paid for in the planning process, and all the time spent finding rates and inventory and gathering proposals, cuts into the agency’s profit margin. For an agency, the media buys with the highest profit margins are those for which they need to deal with the smallest number of media outlets.

In these conditions, the perfect media buy is the one in which the entire budget is spent with one media outlet.

Unfortunately, that’s just not possible in the modern media landscape. In fact, it’s quite the opposite. More media outlets means more targeted media buys.

It’s not that small businesses advertisers shouldn’t use a media buying agency. But those that do hire out their media buying should choose an agency partner with automated and streamlined planning and buying processes over a provider that says their personal relationships with media sellers is their secret sauce to get better buys.

Competition in the marketplace creates biased relationships and non-transparency, an easy way out of exploring each and every advertising option and media channel that might be relevant to a client’s campaign.

And even then, how many relationships can be maintained?  Relationships take time, even in business, and time is money.

In this cost/benefit analysis, information, technology, and efficiency always win.

Media buyers—whether buying advertising for their own business or on behalf of their clients—need to automate. These are the media buyers with time to analyze information, options, and proposals, rather than spending their time trying to collect it all.