Big brands take more collaborative approach to agency contracts

Almost two years since ISBA’s first media services framework caused a backlash among agencies, the trade body backed by Adidas, Coca-Cola and Unilever is taking a more collaborative approach.

ISBA media services framework contract

ISBA is looking to take a more collaborative approach to agency contracts with the release of the second iteration of its ‘Media Services Framework’ after the first version caused a backlash from agencies.

The trade body, which is backed by marketers at major brands including Coca-Cola, Adidas and Unilever, has updated the framework to reflect a rapidly changing media environment and concerns raised by agencies over some aspects of the previous version.

Where the first framework was released without any consultation with agencies, this time ISBA partnered with PwC, which acted as an independent broker to get feedback and views from the six big media agency networks. It also spoke to the IPA, which outlined clauses it felt needed amending, as well as going back to 50 organisations it knows made use of the first framework contract to find areas that need updating.

Speaking to Marketing Week, ISBA’s director of consultancy and best practice Debbie Morrison explains: “One of the key things we wanted to do was engage directly with the six network group agencies.”

READ MORE: P&G to cut agency roster by another 50% as it looks to ‘reinvent’ relationships

Those discussions have led to ISBA incorporating many of the network agency suggestions on how to improve the framework, and led to some areas being left out. For example, Morrison says ISBA was keen to include something about unbilled media but when it explored that areas with agencies they explained why it couldn’t work and so that aspect has been removed.

While ISBA doesn’t believe it made a mistake in not getting agencies involved the first time around because it “needed to make a point”, a spokeswoman says that involving agencies is the right thing to do on this occasion. And having failed to get any of the six major media agencies on board for the first framework (although it did sign up independent media agency The7Stars), ISBA is now working with some of the agency groups individually to develop bespoke versions of the framework.

“One of the things we learnt was more detail about their business models and how they are all quite different in how they are structured and that a ‘one size fits all’ contract doesn’t really work,” explains Morrison. “We therefore allowed them a voice to feed back into the process and that was really helpful, particularly because some of the concepts we are exploring are quite abstract.”

However, the IPA says it still has “concerns over much of the framework’s recommendations”, although it does now see it as a “useful starting point” for discussions between advertisers and their agencies, particularly when starting a new relationship.

One of the things we learnt was more detail about [agency] business models and how they are all quite different in how they are structured and that a ‘one size fits all’ contract doesn’t really work

Debbie Morrison, ISBA

IPA director general Paul Bainsfair says: “We have been working with ISBA for some time now to overcome the concerns that exist over trust and transparency and so I have appreciated ISBA’s openness and the spirit in which they have involved the IPA in the updating of their media services framework.

“We also know, as ISBA do, that ‘one size does not fit all’, so every agency should approach the framework in the spirit in which it is intended, which is as a conversation-starter, and then work out and agree what the mutually beneficial terms of their client-agency relationship should be.”

Getting digital standards right

The majority of the changes relate to digital standards with a lot of the work focused on getting the right standards around issues such as viewability, brand safety and ad fraud in place and better describing the entire digital environment. There is also an updated section on auditor standards, as well as client obligations around having internal media expertise and an annual 360-degree review process.

ISBA hopes the launch of the new framework will prompt advertisers to have a conversation with their agencies and is encouraging members to review their contracts in light of the updated framework. The framework has been beta-tested with some members that were in a pitch situation and wanted an up-to-date version, and ISBA expects every member to request a copy, as they did last time.

The new framework contract is also likely to feed into what trade bodies are doing in other countries, with Morrison saying the Association of National Advertisers in the US is keen to see the updates and Brazil is waiting for the launch so it can create its own version.

READ MORE: Mark Ritson – Media buying’s deadly sins – and why agencies are too late to save their souls

This latest launch is also not the end of the work ISBA is doing. There are plans to focus on exploring sustainable business models between clients and agencies and do more work into areas such as rebates, payments and remuneration. For example, ISBA is looking to produce case studies examining different remuneration models. And Morrison fully expects to have to update the framework again to reflect new areas such as GDPR and further movements in areas such as viewability and brand safety.

“The market is not static. We already know we will want to look again in May because of GDPR,” concludes Morrison. “Anything in the digital environment needs constant review. This will always be in beta.”

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