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Confessions of a Publisher: Rebates 'Drive a Lot of Buying Decisions'
By: Digiday
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Last week, the ANA dropped its much-anticipated report on the practice of rebates, or kickbacks, that media sellers pay agencies for steering clients’ dollars their way — without fully disclosing it to the clients. While the report focused largely on non-transparent practices by the agencies, for this Digiday Confessions, we talked to a veteran publisher who says media sellers aren’t helping, because their outdated way of doing business hampers already-squeezed agencies.

How widespread do you think these rebates are?
It drives a lot of agency buying decisions. Anyone who thinks it doesn’t is very misguided. It’s a function of these agencies being understaffed. The gifting and these buying deals are symptoms of the same thing. The agencies are squeezed. Their businesses are bad. That leads down a path of vendors having to ultimately have to supplement the compensation of their employees.

How do you become aware of it? 
You see trends in terms of accounts buying certain brands over and over and over. You can call it preferred vendor status; you get the sense that clients would be better served being in certain places than others. It’s not “what’s good for the client;” it’s just what they do.

Who’s to blame?
The blame lies in exactly same place as the ANA says. We use agencies to the point where there’s no account that’s properly funded and staffed, so you have an absolute explosion of ad tech companies calling on me.

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This article was published on Digiday.com.  A full link to the original piece is after the story. www.digiday.com
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