Why is it that media negotiations are still characterised by ritualistic flesh-tearing? And why, through a decade of new media technologies and editorial innovation, does media buying and selling remain pretty much the same as it always has been?
The answer is rooted in the elevation of price as the pre-eminent feature of negotiation.
It is not surprising that price is the focus.
For the past ten years consolidation of client media spends has sustained the momentum to drive down costs. The market responded. Media buying became more focused, auditing companies grew and price became more accountable.
In markets where media is essentially a commodity this may not matter too much.
If moving the price is the only way to extract value from the negotiation then inevitably it will become a one-issue conversation. In many ways it is precisely this gladiatorial battle that drives realism and fairness into the eventual settlement. As such, it remains unchanged because it is a successful and efficient process for buyer and seller alike.
Media owners don’t always see it this way.
They often lament that buyers fixate on price, and that their own noble efforts to broaden the discussion are forever impaled on the buyer’s rate obsession.
This does overstate the truth, but it is an understandable view. Buyers tend to conceal the full breadth of considerations lest the information be used against them in the negotiation.
It is not so much the mechanics of negotiation that are overdue for change as the constipating relationships which surround them.
But change is in the air. Media owners are being less purist about how commerce can be woven into the editorial product. And media buyers and sellers are finding a zeal for innovation.
Their creativity can be seen in new outdoor formats, in collaborative ventures with magazines and newspapers and in promotional tie-ups with radio stations.
By comparison, television companies lag behind, their commercial instincts heavily strait-jacketed by the Independent Television Commission and the Broadcasting Act. However, the ITC is loosening the reins and TV companies, particularly the satellite channels, are actively developing sponsorship, merchandising partnerships and advertorials.
This can only gain pace. In April of next year, BSkyB launches the first of 200 new digital channels to add to the 60 or so we receive already.
This will accentuate the low audience/low advertising revenue problem which many satellite channels face.
Seeking income outside spot advertising will be an imperative factor. New advertising formats will include channels offering interactivity and 15-minute advertorial slots. The media has the potential to become much more than an advertising hoarding in a newspaper, on the street or in a TV programme: it will become a distribution channel, a venture partner and an electronic shop window which the customer can browse.
If this happens, media buying and selling will become a much more creative process, one with a key role in shaping advertising in the future.