Dear Ham,

Having read your article, title: "How media agencies make money", I have found enough motivation in me to share with you some personal thoughts. Here, I would like to shed some light on another situation that has plagued the media agency as well.

Here goes:

To the top management of all media agencies and all the new and old big wigs at MSA,

Have you every felt like a worn out wrinkled piece of stained table cloth, pegged to the clothesline, wrung dried and left waiting to be baked by the scorching sun? Well, that's how many of my peers and I feel. Ok, maybe I'm exagerrating but i do think that people in our industry is very much feeling used, milked dried of our brainjuice and shortchanged by the very people whom we see as mentors and associations. We're still living in an era where we are better known as specialists and more often than not, as a group of people who do not exist in the surface of the earth save for the other few advertising compatriots who have a little inkling over what we do. I say this out of the many times I still have to learn how to explain to my friends and new people I meet what I do for a living.

Sometimes I feel like the wheel of an ancient bullock wheelcart, made to slog and slug away to earn my right to stay attached to the cart, oblivious to the vicious cycle. Yes, it's true that we advertising people have been known to work late, get paid little and only moan and bemoan about it among ourselves as we ocassionally fall into the murky hole of self reflection and catch a glimpse of "why the f*** is my passion in fact killing me slowly and giving me sleepless nights." moments of truth.

All this while, we are all trained and desensitized into thinking that this industry works like this because of the unappreciative clients whose only pleasure in life is to dump more and more work on us so that they know they are getting the most bang for their buck and at the same time, our bosses keep telling us that there is an industry shortage of talent and they can't do anything about it, yet the work and the new clients keep coming in and you look at them, they return a somewhat contrived sheepish smile, gives you a pat on the shoulder and tell you they're trying their best. Maybe they are..yesh...maybe they are. But let's take a step back and look at the bigger picture. Is enough being done? Are there not enough people to go around or are we really vying for the same group of people against many other companies who placed job placements ads in the papers.

I think I do have a little inkling over what drives people and what keeps us going and going....Incentives. Most people join the fraternity because they say they have a passion to feed but what's there to say about passion for an industry that didn't even exist very much except as a small department of the whole creative agency a decade ago.

Are they enough incentives for people even to consider this job that we do in the first place? All this time, we are being told that we are one of the better paid professions in the industry, being a very specialized group of people. Yet, in the midst of all the inflation, the rising interest rates and the increasing media costs (which incidentally also means copious increases in our commission), our pay have all but stagnate. Of course, staff pinching among the agencies have only helped bring in a little more clarity and ensured that we have become more valuable commodities that would enjoy a good pay raise if we jerked up our noses and start sniffing where the money is. This has also made the agency heads stand up and start lamenting the fact that their staff costs are going up.

Yes, incentives play a big part too in advertising professionals' life. Why did we even come into this industry only to find that all too glamourous lives that we seen on the silver screen goes poof and slips into memory lane as soon as we start wagging our tails and saying yes to all the requests that our bosses got us to accede to and watch our to do list(including reminding ourselves to make sure we get the laundry in case we forget amongst the whole other list of things that we have to do) grow.

To take another step backwards, why aren't people out there aware of what we do in the first place if we are always shouting about how well paid the people are in the industry. Why is there so little awareness about our industry and everyday, i hear someone from the management telling me that they can't seem to hire people at all (and yes, we're not even talking about able and good hires yet) and many times, we all just simply nod our heads in agreement without even thinking enough of the implications. Why aren't more being done to bring our industry to the forefront, to stop lurking at the back and look like a support function of the fraternity when all these while we are trying to push for more stage time from our clients, asking to lead their accounts at times.

A quick check on the internet and a scour through the courses being offered at our local colleges and university and you may somehow be able to find out that out of the many professions that universities and colleges seem to offer and the many jobs that they are professing to teach and get you into, media planning is not even one of them. Considering how specialized this job is, I don't understand how the basic media planning 1 module subject is even going to be sufficient. True, maybe young people nowadays don't really know what they want when they join college and hence should be offered a much wider scope of courses to take so that they have a wider variety of choice when they come out into the industry.

Come on.... If I have studied arts and design, would I want to go into account servicing or media planning? What I would like to advocate is to ensure that the schools today are ensuring that their courses simply stay relevant in today's advertising world, where change and the new media have simply fast forwarded everything.

It's been so many years since media has evolved to become a separate function of the advertising fraternity yet we have done nothing as an industry but bemoan the lack of talented young planners, and then when these planners have been trained at the expense of the time and effort of the senior people, only to have them leave and move on to another agency in search of better pay and satisfying their own delayed pursuits of more money in their pockets.

Maybe while we are trying so hard to keep ourselves relevant and ensure that we are being truly recognised as consultants and how best to help the client spend their advertising monies, it's imperative that we recognise that there is a sufficient base of people at the bottom of the food chain for which we will see move up one day, else....as the saying goes...the rich gets richer, the poor gets poorer...the selected few becomes more knowlegable and the ignorant ones will always stay ignorant and will one day find it almost impossible to catch up and tighten the gap that separate us secluded village planners who live in our own world from the real world out there.

Maybe the whole idea of advertising and understanding what communications and media planning is all about should be transferred slowly to the advertising schools and we can lessen the unneccesary burden we media agencies carry. Maybe we can do more and we need to start today and stop procrastinating. Maybe if our work is less busy, we could get everyone together and start having one of those "pick your brain" sessions about how we can all have less work and more pay and really look like we are enjoying ourselves and our work. Maybe one day...

Thanks for your time.

disgruntled momentarily,
SC

Dear Sledgehammer,

Good article you wrote in Star Bizweek on 12 July 2008. I work in the publishing business and I have seen how some media agencies cut their own commission to grab our advertisers. Quite a silly thing to do. Media agencies steal our existing advertisers, drive a hard bargain to get the cheapest ad rates from us the publisher, and push us to give them more free ad space to get their ad booking. What extra services or insight do media agencies offer to our existing advertisers who have been advertising in our publications for years? Surely, our advertisers know what they are doing.. They know their industry better than the media agency, and they would hate to admit that they have been wrong in their choice of ad spending. So what extra services do media agencies offer that we, the publisher and media owner can’t offer to our advertisers? We offer free write ups, free editorial support, and even designing advertisement artwork (acceptable and decent quality) for very minimal cost, all of which are part of the advertisement services we offer to our advertisers. If these services are given almost free as part of our advertisement package, how much do the media agencies charge their clients? Do they earn more money from creating write ups or articles for their advertisers? If they charge their clients for this service, using media agencies will be more costly to the advertiser, than if they booked directly with the media owner.

Media agencies are a type of parasite to media owners. They grab our existing advertisers, push down our ad rates, demand free ad space, and are slow in paying up. It could take up to 4 months for us to get paid. In the publishing business, almost all our suppliers will insist on cash payment on delivery. Risks in publishing business is high since we bear all the costs of production and distribution, and collection of payment will take months. We also bear the risks of market demand and supply. Costs seem to increase every year. So, when media agencies come in and demand lower ad rates, slow payment terms, it makes business tougher for us.

I have not encountered any media agency who demanded rebates from us. But the standard commission we pay them is usually 15%. Some media agents don’t provide us artwork or any help at all. We have to collect the artwork, prepare write ups or articles for their ads, and send them dozens of copies of our magazines and books after it is published. So, do you think 15% commission is too much for them?

The reason why many advertisers use media agencies to handle their ad bookings is to save them from a lot of headaches of planning ad bookings, artwork deadlines, and choosing the right media to advertise in.

I don’t think the time for media owners has arrived yet. Media owners are too busy working on their core business. I’m speaking from my experience in the publishing business. Advertisements help cover some of the costs of production. If media agencies want to advertise in their media, the media owner will gladly accept it, even it the ad rates have been lowered.

Do you know of any Association of Media Owners or Publishers in Malaysia? It would be interesting and useful to get together to compare notes and discuss about our problems.

Regards,

K. C. Ng

Hi Ham,

Read your article in The Star on 12/7 on the above title, truly I agreeable with you. Well I'm one of the media owners (which you can Google me by my name) noticed that we can actually cut agencies income by strictly giving back to them 15% a.c.

I'm not saying that i'm against ad agencies but being in new media dept we actually deals with a lot of local 3rd party agencies that do the booking and creative for some international agencies. As you said in the article, as client asked for rebates this 3rd party will start asking us for higher discount on top from what they're getting.

For instance, we have a new media agency (3rd party) which all this while doing things on behalf of another established ad agency, they have been enjoying 30% as agency commission (15% + 15%) until one day the client keep asking for extra rebates, they came to us for additional cut. Thinking of it, I felt it’s unfair for us to give additional cut as though we have to bear the rebates while other still enjoys their cut untouched. They should be thinking in a way to give back from their earning instead of asking us the media owner for more. And the day has come where we have to put a stop to it...before it start to be more like a 'pasar malam' kind of business.

Indeed...The age of the media owner is here!

p/s: hope to catch up in the media conference.

Regards,
Zainy..