ISBA's director-general Phil Smith is all too aware that advertisers' and agencies' interests have become "misaligned" over how media planning and buying is paid for.
Speaking to Brian Jacobs in the latest Mediatel News "Making Sense of it All" video interview, Smith urged brands of all sizes to make use of ISBA's updated Media Services Framework in order to ensure they can benchmark their agency with the industry.
"We do work with the IPA and the agency community wherever we can find common interest: climate and diversity would be obvious examples of that; creative pitch processes and practices –another area where it's easy to align," Smith said.
"It's been more difficult for us where interests have become misaligned or conflicted over a long period of time as in media.
BRIAN JACOBS: So, Phil, it strikes me that advertisers have got more data than ever before; we all know that and they've got the opportunity to understand more about their consumers than they've ever had before. It's probably a bit overwhelming for most people, I would imagine, having all this data suddenly coming at you. But what do you think are the major difficulties they have to overcome to take maximum advantage of this? What are the things that get in the way for them?
PHIL SMITH: Well, as you say, there's been an explosion of data and a real lack of homogeneity when it comes to where it's coming from and what it looks like. A lot of it sits in silos, from the vendor as well as in the receiving company.
And I think there's a lack of connectedness as a part of the difficulty. I'm sure also that having the expertise to analyse and interpret all of this dissimilar data is another big factor.
It's always been the case that generating understanding from data has been part-history, part-science and always been difficult to test hypotheses and getting to a coherent working model of the world has always been hard, particularly when you take into account long-term impacts and externalities.
When you're looking at advertising in the context of other powerful levers, especially in those kinds of businesses that have multiple contact points, it's a really difficult trick to pull off.
It's always been possible to look at the same set of data and come up with wholly different interpretations and recommendations and with today's focus on ROI there's been a lot of the data that's being produced it's very focused on proving immediate cause-and-effect.
It's really striking when you look at the difference between attribution models and the kind of data that's coming out of, say, Thinkbox's econometric-based work to see the difference in the world that they're painting.
The other thing that has to be said is: a lot of the data is irrelevant. It comes with a lot of spin and there's certainly a fair amount that's designed to make either the seller or the buyer look good.
JACOBS: And to confuse everybody all the more! (- SMITH: Yeah) It's interesting isn't it; you've got this great rise in proprietary data, advertisers have got so much better – just over my time in the business – of looking at data, collecting data and there's been this great increase in the number of advertisers setting up internal departments to make the most out of all of this and 'make sense of it all'.
All this seems to coincide with a growing demand for industry data – generic-type data – do you see this as a bit of a dilemma? Really isn't it about a dichotomy between, on the one hand proprietary data, and on the other hand industry-wide data?
SMITH: Yeah. They are two sides of the same same coin, really.
First-party data is great and it's the stuff that you can really rely on. It does tend to focus on existing customers, it does focus on nearing prospects and sometimes misses that that bigger picture.
What we've not had in industry data is is a really good solid data set that's accountable and has a lack of bias with it. So it's not really been a surprise from where I've been sitting. [There was] certainly a clear gap on industry data as I came into the job and it's been, by far, the biggest call from members since the first day that I joined.
JACOBS: We tend to think of the really big guys, don't we, but obviously you've got a broad spread of members. I would merrily say "they're busy building departments," but I guess some of the smaller people, industry data is vital for them...
SMITH: I think it is. It's really big for the big guys, too, but of course the big guys are changing and many of those businesses grew up with a very much digital, first-party data mindset.
But the more their activity starts to exploit all of the tools that are available, the more they need that industry data to sit alongside the first-party.
JACOBS: It seems, just from looking at it from the outside, that ISBA these days is working very well and very closely with the agency side, with the IPA, and yet on an individual basis you keep reading about lack of trust and concerns about contracts and all that kind of stuff.
What do you think can be done to improve the situation as an individual company level?
SMITH: There are things that that we can do to help and I'll talk about individual companies as well.
The first thing to to do is to make sure that you start by understanding this is not going to be helped if we treat it as a as a blame game.
But, by the same token, it's really important to understand the commercial motives that every party has coming into into their relationships.
We do work with the IPA and the agency community wherever we can find common interest: climate and diversity would be obvious examples of that; creative pitch processes and practices –another area where it's easy to align.
It's been more difficult for us where interests have become misaligned or conflicted over a long period of time as in media.
But, absolutely, we do seek to foster sustainable agency relationships. We believe that's in the best interests of our members and those have to be based on trust, in capabilities alongside an alignment of interests for us and for members.
Initiatives like our Media Services Framework are designed to bring clarity to the commercial underpinning of the relationship, provide a better chance to manage appropriately and effectively.
So, [the] things that I would say advertisers can do individually is: make sure you make use of all of the tools that are there and being created for you by ISBA which is the only body that's there to work solely on behalf of advertisers.
The first thing that they could do is look at their current set of media arrangements, up alongside our latest Media Services Framework which came out [in July] and see where the gaps are and seek to understand why.