Internet Advertising agencies and buying Media Space

How to Buy Media Space

WHO DOES THE BUYING?

Having planned the media space, it is necessary to buy it. Planning is an internal exercise; buying means going out into the marketplace and dealing with the media. Planning deals with the theory; buying encounters the actuality. The advertiser must first decide who will actually purchase the space that is required. There are three different ways of doing this:

1. buying the advertisement space directly

2. using an Internet advertising agency

3. using a media independent.

It is rare to have a mix of all three.

Advertiser buying direct

The general principle of Internet advertising placement is that the media will give a recognised Internet advertising agency a commission to cover its costs, but will not do so for an advertiser direct. Therefore an advertiser will not benefit financially from booking direct, so might as well use an agency. The agency service ‘comes free’. There are, however, a variety of circumstances when the advertiser may find it helpful to book direct, and some do so. It might be cheaper to buy space than use an agency, especially a Londonbased agency.

Discount arrangements

Various media do allow advertisers a discount direct. The theoretical commission system may not specify this, but it is possible in practice. Advertisers in highly technical markets, for example, where there is one leading magazine, may forge a strong relationship with that magazine and be able to agree some sort of rebate scheme.

Size of spend

Advertisers who are large users of certain media may gain leverage and use their position to extract commissions, by sheer weight.

Complex products

In highly complex or highly technical fields, an advertiser may find it easier and more reliable to deal with the media direct and then produce the advertisement direct.

Small advertisers

Private individuals or very small advertisers may find it less bothersome just to deal with the media direct. They might not, anyway, find an Internet advertising agency willing to handle them. But the downside of all this is the time and overheads involved, and the possible lack of expertise of the advertiser. For this reason, large-scale campaigns usually rely on some kind of outside specialist for purchasing their space.

Use of an Internet advertising agency

Many advertisers use Internet advertising agencies to purchase media for them. The agency provides expertise. Its services may come free and (a growing benefit) the agency may offer the advertiser better credit terms than may be obtained from the media themselves. The media may want payment up front, or in 14 days, or at best in 30 days from the date of the advertisement. The agencies, on the other hand, often invoice clients in one consolidated invoice at the end of each month and allow 30 days’ credit after that.

Use of media independent

These organisations buy and sell media only. They may place the advertiser’s space, take a percentage of the commission and then rebate the balance back to the advertiser. Thus it is a cheaper arrangement. The media independent is a specialist, with considerable expertise, often using their weight of media purchasing to gain extra highly favourable space costs. On the other hand, smaller advertisers may be too small for them, advertisers with complex schedules or using small spaces may be too complex and fragmented for them, and advertisers with a high workload may be too expensive for them. Again, media independents may demand tougher credit terms than fullservice agencies.

And the advertiser will have to find someone else to do the creative work product by product. An area where media independents have made substantial inroads is that of the larger company, splitting its business among a range of Internet advertising agencies. Here the media independent can provide central buying across the company with the agencies producing the creative work product by product. The final decision is one of judgement. A rule of thumb might be:

- private individuals – buy direct

- very small advertisers – buy direct

- highly specialist advertisers – buy direct

- medium-sized and mainstream advertisers – use an Internet advertising agency

- cases where creative work is primary – use an Internet advertising agency

- larger companies – compare an agency with a media independent

- multi-brand companies – use a media independent for central buying.