Sexy auctions obscure greater needs
In 1998, a director of MediaTel, Simon Martin, who was previously at PHD, and is now making a name for himself in non-media areas at Experian, wrote a MediaTel whitepaper outlining a vision of a changing media buying and selling environment driven increasingly by web-based platforms. The paper ‘A Big Bang in Media’ “highlighted the efficiencies which might be gained using the Internet in Media to reduce administration and improve the bottom line”.
A reference to ‘The Big Bang’ was of course a reference to an analogy with the major operational changes on the London Stock Exchange, which took place in October 1986. Note that, 1986!!
25 years on and much of the media industry still uses day books and reams of spreadsheets.
Since then there have been successes. CARIA and J-ET have significantly improved the administration around radio and TV buying, but online – for all its technology – remains something of a shambles around the actual buying process, and press resists at a time when it possibly needs it most. At the time of our white paper, a number of companies were also experimenting with auction systems for media. i-mediapoint, which became Optimad (now bought by IMD and running CARIA) was the leading light, but it did not gain enough day-to-day inventory.
We did not feel that auctioning would work universally, but could see some areas where it might be more appropriate and more effective, and did discuss some interesting ideas with a newspaper group a few years later, which never saw the light of day, sadly. Premium inventory seems the obvious opportunity. Agency agreements or deals seem the obvious barrier to this.
Optimad tried it a few years back for an auction of valuable, donated media inventory for the Tsunami appeal. The response was sadly underwhelming.
This month, Media Equals has launched the media auction for Olympic outdoor inventory to Olympic sponsors. Whilst there is keen interest in this, it is a product aimed at a closed group already sold on the value of participation (to at least some degree one assumes), so I would not take this as a measure of whether auctioning of media can work on a wider scale (in TV or press for instance). That said, an auction for The X Factor spots would be very interesting.
Either way, whilst auction technology is sexy, and might benefit a few agencies and advertisers, Simon was right in 1998 to focus on making the whole planning and buying process more electronic and more integrated. In 2011 that would still have bigger and more immediate financial benefits.