Amid industry discussion of the evolution of the major agency holding groups and the efficiency of their sprawling structures, it’s important to remember that their size still brings them a number of major advantages.
While many programmatic platforms offer self-serve capabilities which advertisers can use directly, major agencies usually get better rates on these tools thanks to their size and spending power. In some cases, advertisers will be locked out completely by minimum spend limits. And even for those who aren’t locked out, even knowing where to start when it comes to putting together a media plan and executing it can be tricky.
James Allen and Joey Medici, co-founders of Media Disco, a business which works with mid-market advertisers and agencies, understood these advantages well, having worked for major holding group agencies themselves. “Through the holding companies, advertisers get access to great teams, tools, and expertise on the soft side,” said Allen. “And then on the hard side, they get access to the best ad tech, lower minimums or no minimums in their contracts with those companies, and great rates in terms of negotiating power.”
The vast majority of advertisers can’t access these advantages. The holding companies only represent 22 percent of annual US media spend, says Allen. The flip side of this is that there’s still a huge amount of spending power which, if brought together, could similarly access many of the advantages associated with the big agency groups.
That’s the opportunity which Media Disco is targeting. “What Media Disco is designed to do is level the playing field for all of those mid-market advertisers and agencies,” said Allen. And the key word is ‘access’ – access to the best ad tech companies, and ad tech to the best rates and contracts.
A win-win?
Part of the formula is leveraging buying power, in essentially the same manner as a big agency group. Since Media Disco aggregates spend through working with a number of mid-market advertisers and agencies, it’s able to negotiate more favourable rates and minimums with vendors.
Another major factor is the fact that Media Disco does a lot of work itself to facilitate transactions and deals between its clients and the vendors it works with. Working with a large number of smaller advertisers and agencies requires a lot of manual work for vendors, compared with dealing with a small number of large clients. And sales and outreach itself is costly. As such, for it to make commercial sense for vendors to deal with these smaller businesses, they’d have to charge much higher rates.
But by facilitating transactions and taking on some of the manual work itself, Media Disco makes these deals more commercially viable for both sides. “We’re essentially allowing these vendors to be introduced to this massive mid-market of buyers that their seals teams wouldn’t usually be in front of,” said Medici. “Most of these ad tech companies’ attention is spent on the whales – the big agencies and massive advertisers. It’s not really reasonable for them to build up a sales team to cover off that mid-market. So our platform introduces them to this net-new buyer who they probably wouldn’t have met advertisers, and that means they’re able to drop their rates for us, it’s a win-win.”
Obviously playing this facilitator role is easier said than done – spending too much time hand-holding a large number of smaller clients would be costly for Media Disco itself. To square this circle, Media Disco operates as a platform, where clients can self-select deals based on searches, but also steps in to manually help secure deals and negotiate bespoke arrangements when needed.
Looking for inspiration
The first step for Media Disco has been auditing vendors who are allowed to sell through its platform. Part of the value from agencies, and the problem for smaller advertisers and agencies, is knowing what’s available on the market, what’s trustworthy, and what will help them reach their goals. So Media Disco curates vendors covering different types of media buys, to ensure they’ll all provide value for clients.
“We really want to be a source of inspiration for buyers who don’t know exactly what they’re looking for,” said Medici. “A lot of these smaller brands don’t know what they don’t know. Or maybe they know they need to drive awareness or sales, but they don’t know all the options available to them across different channels and types of targeting.”
These vendors put together packages based on their offering, with different audiences, media types, and targeting parameters. Buyers then use Media Disco’s platform to search for media, and choose a package which suits them.
Buyers will often want to tweak these packages – for example to refine the audience slightly, or the remove a media type which they don’t have assets for. This is where some of the manual work for Media Disco comes in. “We’ll send that customer feedback to the vendor that put that deal up,” said Medici. “They then give us a thumbs up if it makes sense for them, and they’ll estimate a number of impressions or video views based on the money the buyer wants to spend. Then the buyer uploads their assets, which we QA really quickly, or we can help them build the assets if needs be. And we’ll handle the IO process, which is something a lot of these smaller brands aren’t familiar with. So we’re helping them, and also doing some of the lifting for the vendor side.”
Alternatively, buyers can send a simple RFP themselves. Media Disco will then send that out to whichever vendors it thinks is appropriate, and again help with putting a deal together and executing it.
Keep it simple
For Media Disco, keeping the platform fairly simple and straightforward, while offering flexibility, is key. Demand-side platforms might offer self-serve tools for individual advertisers, but a buyer still needs a good understanding of programmatic advertising to be able to use them. On the vendor front, Allen and Medici say they’re slowly expanding the list and keeping it fairly small, so clients aren’t overwhelmed by the number of choices available to them.
The vetting of ad tech partners and monitoring of campaigns is also important. “A part of the benefit of working with an agency is that you’ve got a team of people that are monitoring your media and making sure it’s doing what it’s supposed to do,” said Allen. “So if you can’t afford to pay an agency to do that, where do you go? What you get with Media Disco is the simplicity of a self-serve tool without needing to know how to operate programmatic platforms, but with the safety net of knowing there’s a team that’s monitoring and creating those activations on your behalf.”
The extent to which the company helps out with manual work depends on the client. Small agencies, an important group for Media Disco, might come to the platform with a clear idea of what they’re looking for. The value to those clients is that Media Disco enables them to offer more sophisticated targeting, even with more limited resources.
“You’ll see a lot of small agencies which try to do everything, and they say they offer paid media, but what they really mean is that they’ll help you run social, and they’ll run some Google programmatic for you,” said Medici. “Part of what we want to offer those agencies is they can go out and offer things like geofencing, rich media, and CTV – it gives them a tonne of access that separates them from other small agencies, and helps them compete with the big holding companies.”
