We talk to Frances Dickens, CEO and founder of Astus Group, about why the industry should come to terms with media bartering.
Could you explain the Media Bartering process?
Media barter is a 21st century business process that allows brand advertisers and media owners to get the media they want without having to pay 100% in cash. Essentially clients are able to use their goods and services to part fund their media budgets, thus creating a substantial cost benefit.
The role of media barter specialists is to facilitate the deal between brand advertisers, their media agencies and media owners to make sure everyone gets what they want out of the deal.
Is media bartering on the rise, and what changes in the industry are accounting for this?
In the UK alone media barter is currently worth between £250m-£300m, (up from around £200m in 2010) and accounts for around 2% of media billings. The economic downturn has meant that advertisers and agencies face greater pressure to come up with new ideas to make budgets work harder and media barter represents a lateral approach to the problem of squeezed budgets.
At its current growth, do you see it taking over other forms of buying or exchange, and if so what?
Within the media market there is a clear understanding about the role of media barter and its limits. Media barter is very much part of the media/marketing mix – it complements rather than cannibalises the way in which media is traded.
We’re keen for clients to get the most efficient and transparent media barter deal possible. With this ethos, we hope the sector grows naturally as a result.
What should brands and advertisers be aware of when thinking about going into it?
Modern media barter is about using first line product and not just distressed stock. That said, we have traded everything from telephony, holidays, insurance policies and luxury goods to event tickets, vouchers and electronics.
Media barter is a modern business process - in order to get the most out of it, it needs to be integrated with media strategy and business planning. Brand advertisers should discuss it with colleagues in sales, marketing, procurement, finance and with their media agency. The process is more of a gradual consultancy than a quick sell.
Why will people still be wary of media barter?
Ten years ago media barter had a bad reputation. It was based around a system where brand advertisers exchanged their products for notional trade credits, which in theory could be used to "buy" media but which all too frequently couldn't be redeemed. As a result advertisers were left out of pocket and most media agencies quite rightly refused to give barter a second look.
Since then media barter companies have introduced a more ethical, delivery first model where advertisers receive the media they want before being asked for their products in exchange. Media barter companies have also looked to work in partnership with media agencies.
I think the real change is that advertisers and agencies have seen that done well, media barter can add significant value. But the onus is on media barter specialists to ensure that we don't make promises we can't deliver on and that we give advertisers the best possible return for the asset.
How do you see the media buying landscape developing in the near future?
I think the chances are that the process of media buying will become more automated as is already happening with buying of digital media. We will also see the rise of sophisticated systems that can plan, buy and optimise ad campaigns simultaneously across a wide range of different media. Technology won’t take over completely however, when it comes to complex negotiations the importance of real human relationships shouldn’t be underestimated!
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