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Media-buying services plan and buy advertising slots in press, television, digital and outdoor media on behalf of clients and agencies. They may be independent companies or part of larger advertising agency or marketing services groups. The world’s largest media buying agency in 2013 was Starcom MediaVest, owned by agency group Publicis.
Offering Clients Better Media Rates
Media agencies aim to ensure a marketing message appeals to consumers, appears in the right place, at the right time and that the advertiser pays the best possible price, according to the agency MediaCom. These agencies develop their buying power by consolidating media purchasing for many clients, enabling them to negotiate better deals for clients and earn income by taking a slice of the billings in commission. Starcom MediaVest’s billings total in 2013, for example, was estimated at $47.07 billion in 2013, according to the AdBrands website.
Developing Media Plans
Media planning is one of the two main roles of a media-buying service, according to the AdBrands website. Planners discuss advertisers’ requirements and use industry research and their knowledge of media, consumer media preferences and consumer behavior to identify media that will reach the largest section of the target audience at the lowest cost. They prepare plans showing which publications, TV channels or other media will carry the ads and produce schedules showing the preferred publication or broadcast dates and times. By offering planning services, media agencies may supplement or replace the media services offered by advertising agencies.
Buying Media
Media-buying agencies negotiate with the advertising sales representatives at media owners such as television broadcasters or newspaper publishers to book their preferred dates, times or space and negotiate a rate. In some cases, agencies may negotiate with media owners for a specific client or individual campaign. For example, they may agree on a media rate for a year for a major client, regardless of planned campaign dates, or they may negotiate on a campaign-by-campaign basis. Larger media agencies also buy media in bulk at preferential rates, based on an understanding of their clients’ past and current media plans.
Income Sources
Media-buying agencies derive their main income from discounts or commissions from media owners. The commission rate can be as high as 15 percent of the media budget, but the rate has fallen with increased competition, according to AdBrands. Major agencies may be able to negotiate additional rebates based on the size of their annual expenditure, according to The Guardian newspaper. Smaller agencies with less buying power may charge their clients fees and refund any commission they receive to the client.
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| How Media-Buying Services Work |
Media agencies aim to ensure a marketing message appeals to consumers, appears in the right place, at the right time and that the advertiser pays the best possible price, according to the agency MediaCom. These agencies develop their buying power by consolidating media purchasing for many clients, enabling them to negotiate better deals for clients and earn income by taking a slice of the billings in commission. Starcom MediaVest’s billings total in 2013, for example, was estimated at $47.07 billion in 2013, according to the AdBrands website.
Developing Media Plans
Media planning is one of the two main roles of a media-buying service, according to the AdBrands website. Planners discuss advertisers’ requirements and use industry research and their knowledge of media, consumer media preferences and consumer behavior to identify media that will reach the largest section of the target audience at the lowest cost. They prepare plans showing which publications, TV channels or other media will carry the ads and produce schedules showing the preferred publication or broadcast dates and times. By offering planning services, media agencies may supplement or replace the media services offered by advertising agencies.
Buying Media
Media-buying agencies negotiate with the advertising sales representatives at media owners such as television broadcasters or newspaper publishers to book their preferred dates, times or space and negotiate a rate. In some cases, agencies may negotiate with media owners for a specific client or individual campaign. For example, they may agree on a media rate for a year for a major client, regardless of planned campaign dates, or they may negotiate on a campaign-by-campaign basis. Larger media agencies also buy media in bulk at preferential rates, based on an understanding of their clients’ past and current media plans.
Income Sources
Media-buying agencies derive their main income from discounts or commissions from media owners. The commission rate can be as high as 15 percent of the media budget, but the rate has fallen with increased competition, according to AdBrands. Major agencies may be able to negotiate additional rebates based on the size of their annual expenditure, according to The Guardian newspaper. Smaller agencies with less buying power may charge their clients fees and refund any commission they receive to the client.
Posted in: Advertising
