ISBA President Attacks ‘Festering’ Remuneration Problem
ISBA president, John Sunderland, has called on advertisers and agencies to work together to develop comprehensive best practice guidelines to help lay the ‘festering remuneration’ problem to rest.
Speaking at the IPA’s annual lunch yesterday, Sunderland attacked advertisers for relying too much on the ‘dreaded’ procurement team to chase cost reductions. He also emphasised that too narrow a focus on savings does nothing to help agency performance.
The advertising downturn has caused a major shift in the way media agencies are paid with almost half of all firms now incorporating some form of payment by results system. However, Sunderland called for the industry to pull together to tackle to problem more effectively (see ISBA Study Reveals Shift Towards Payment By Results).
He said: “I believe that there is a need for more imaginative thinking beyond the current payment by results. I am keen for ISBA and the IPA to jointly focus on the connection between the effectiveness of agency work with the remuneration they receive – the measurement of added value.”
The ISBA and Cadbury Schweppes chief, added: “I realise that no two cases are exactly the same but we should be able to offer enough guidelines to lay this festering remuneration problem to rest once and for all.”
He acknowledged that the difficult economic conditions had forced marketers to be vigilant about all costs, but called on advertisers to view agencies as business partners whose creativity and experience must be properly funded to be most effective.
Sunderland emphasised the need for continued collaboration between agencies and their clients to protect competition between media owners for advertising budgets. He said: “Consolidation is now a clear trend throughout the whole media industry; we must prepare a united front and react sooner rather than later.”
The ISBA chief also called on agencies to work with advertisers to protect the freedom to promote their brands in the face of increasing calls for knee-jerk restrictions in certain areas. He said: “We all know that good advertising is highly effective. But the negative side of overselling advertising is that politicians, pressure groups and the public are staring in the shop window.”
“It is a ridiculous myth that advertising has a dark power to overcome free will. But we need to make sure that we are realistic about the power of advertising and we are realistic about its limits,” added Sunderland.
ISBA: 020 7499 7502 www.isba.org.uk
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