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 |
 |
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| Darren Woolley Regional MD, TrinityP3 |
Prashant Kumar CEO, Mediabrands Malaysia |
Nick Binns Partner, The Exchange, Mindshare |
Randy Weddle MD, IHT Asia-Pacific |
YES |
NO |
NO |
Yes |
| “Media is the ultimate marketplace where the price of the advertising is based on what the market is willing to pay. Irrespective of what the media owners want for their ad space, demand and competition will drive the rate to what the market dictates. Of course, that is if the buyers have the right negotiation strategies, people and media buying processes in place to ensure they are not paying above market rate. The real issue is not whether media owners are being realistic in setting rates, but whether the media market is a level playing field. During the boom years, we witnessed the tacit acceptance of media rate increases from owners simply passed on to advertisers. Now in a shrinking market, many media agencies are still talking up the market and reducing expectation on the level of reduction. The media marketplace is going through a major correction in rates after years of growth, well in excess of the retail price index. Going against this correction is a brave strategy that will succeed or fail based on the market’s response.” |
“Many media owners, spoilt on the explosive growth and bonuses of the past five years, are still in denial.
The recession has compelled many marketers to go for a severe re-assessment of their costs, their staffing, their investments, their pricing and their business models. Media owners need to play their part too. This doesn’t mean that marketers should freely pass on all their cost stress to them. Media owners should unlock extra value from existing inventories via new creative opportunities, higher flexibility, new pricing models, special packages, flexi-term deals and risk sharing. Those with cross-platform assets in digital should make the best of them.
Media owners In Malaysia, while a few media owners are lying low, taking in soft adjustments, waiting for the storm to blow over, the majority are yet to embrace the full implications. And there is at least one which has gone for an audacious contrarian stance, dramatically raising its price, based on a re-assessment of its ‘true worth’. Now that has really made the game more interesting.” |
“In China, the answer is clearly no. Ad rates in the market are not determined by market forces, but the Government-owned media owners. However, there is light at the end of the tunnel. Although a portion of media owners originally approached 2009 discussions with a degree of aggression and aspirational revenue targets, we’ve now seen a more long-term, sensible approach to rate-setting. Sadly, in any market you’ll always have a degree of over-priced media platforms which agencies have to navigate around. As well as establishing a new approach to prices, media owners are now being forced to be more proactive with how they work with agencies and advertisers in the areas of digital, content and video. The change in the economic climate has forced many media owners to begin thinking about a new approach and not set prices as a means to controlling revenue growth in China.” |
“Ad rates, in the best of all possible worlds, should reflect the quality of an unduplicated audience that the media owner is able to deliver, balanced with the desirability of that audience by advertisers. In most instances, this balance is met — simply because the competitive nature of this industry would otherwise force the prices down. The harder it is to reach that audience, the higher value it should carry. The bigger question relates to the situation surrounding the methodologies by which media audiences are defined and measured. Research that measures readership has, historically, been affected by promotional activities that occur during the fieldwork periods. This has, in turn, affected the outcome. The more money spent on promotion by a media owner, the higher the recall score — which is more about the effectiveness of the promotion than about the actual readership. A sensitive issue, but a reality just the same.” |
Off the Fence... 'Are media owners setting ad rates realistically?'
With client spend under pressure, are media owners doing enough to adjust their advertising rates?
