The advertising market according to CEASA was worth $13.5 billion dollars for the 2011/12 FY. Cue Dr Evil! The media revenues generated in Australia per capita are some of the best in the world.
The perception is that all of these billions come from the big national, multinational and international brands and advertisers. After all, that’s all you ever hear or see in trade mags and online. They certainly do constitute a goodly portion of the dollars spent, but the great unsung hero of the Australian media market is the direct advertiser and even less warbled about are the committed and dedicated group of direct account managers and talented creatives working in radio, TV, newspapers, digital and other mediums across the country.
Dealing with small mum and dad shops who will tell the AM “It’s my last $1000 and grandma will have to come out of the nursing home if this doesn’t work”, through to medium to large companies with seven figure budgets, this group of media professionals (nay experts) work tirelessly to get their clients message across, build their brand, execute smart promotions, integrated concepts, and deliver ROI that will ultimately help their business grow. Do they always get it right? No – but I’ve seen some spectacular failures from agencies too. A flawed idea or execution is a flawed idea or execution, no matter how much you throw at it.
Direct is definitely not sexy, it’s just hard work, commitment and passion and its groundhog day. You won’t see your client’s campaign lauded to the industry and the creative will never win a Lion (great creative for direct is another whole article), but nonetheless it’s a critical piece of the pie for the Australian media industry and perhaps closer to home, our respective employers. For a similar period, according to Nielsen Media’s Adex data, the direct market was worth nearly $4.7 Billion dollars or 35% of all advertising dollars spent.
I can tell you anecdotally as a senior manager in a media organisation, it’s definitely more than this. The accuracy of reporting on this market segment isn’t at a point where we can be certain of the number.
Direct account managers at the Australian Radio Network, where I hang my shingle, are scarily good at sourcing campaigns from a range of companies and opportunities. Additionally in many media companies direct AM’s deal with Tier two or UNA (unaccredited) agencies.
They bring opportunities and often direct contact with their clients that allows the media company to influence the outcome. Fact is, the reason tier two or three agencies exist is they fill a void that major agencies can’t. At the direct level it’s all about a deep understanding of the business, relationships with decision makers, ideas generation, and most importantly making it work, and bloody quickly I might add.
A lot of clients and small agencies prefer to have that “direct” relationship with the station or media outlet, but which one is better, direct or agency? And here it comes, the controversial answer ... Both.
For the same reason large agencies aren’t resourced to provide a high level or service to this end of the market (time and costs versus return), direct account managers aren’t resourced (as a general rule) to service $25 million dollar clients with multi-layered media strategies. But it’s surprising the level of share some direct clients generate and the complexity of thinking and execution.
Today’s direct account manager, (the good ones) know their medium isn’t the only solution and they work to understand the client’s needs across a range of media and execute accordingly. Importantly they work their relationship and understanding of the client’s business and quantify measurable returns. These guys are kings of expectation management. Because if you get wrong you get a face to face discussion (close enough to know if they need a mint), with an unhappy client.
It’s not for the faint hearted. Good direct media professionals are as rare as the proverbial rocking horse poo.
Right or wrong the perception is that if the client works directly with the media outlet they will get a better rate or a greater access to promotional opportunities. It’s not true in my experience. Both agency and direct get treated pretty fairly, for example at ARN both work off the same rate card, and if anything the bigger spending agency client usually gets the bigger opportunity or idea. But the great thing about a direct client is they are often far more open to ideas and flexible in their thinking, allowing the media platform to really maximise its strengths, delivering a much better result for the client (and kudos for the medium).
From a media perspective direct does have one major advantage over agencies, though they have the ability to directly (no pun intended) influence the decision, they can do it faster, and they can find the clients hot button and push it. In tough times direct sales doesn’t suffer the same pendulum swings in the market experienced in agency . They are far more masters of their own destiny.
The final word though goes to the media owners and shareholders – don’t ignore this 35+% revenue stream. It’s a gold mine if you know where and how to dig, and plenty of savvy media companies generate significant revenue from this part of the market. Yes it’s a higher cost base, but don’t forget, every company starts out small and direct.
David Hefter
National Sales Director – Direct
Australian Radio Network