Research

M&M's Sales Team Benchmarking Survey

Last year tested the stamina of every media owner, but it also offered plenty of opportunities for the industry to really prove its worth. M&M’s annual Sales Team Benchmarking survey examines how companies have spread diminishing budgets for better ROI

Pessimism was a familiar emotion among media owners in 2009, and apparently they felt it more keenly than their advertiser and agency counterparts. When evaluating how much the economic downturn had affected their work over the past six months, a huge 70% felt they had been considerably compromised, compared to 62% of agencies and only 47% of advertisers, perhaps reflecting the power of the food chain.

Media owners and agencies were equally affected by cost-cutting within their own companies, and at the companies with which they worked. In terms of hard impact though, fewer media owners (41%) reported a decrease in staffing numbers over the past 12 months than agencies (48%). Original headcount will have much to do with it, but the upshot of this will have only increased the expectation on suppliers.

What did media owners need to deliver against?

Unsurprisingly, the biggest priority for agencies when selecting which platform to use was the media owner’s ability to prove return on investment. Nearly half the respondents ranked it first, while offering a creative and flexible approach came a clear second. Other issues – professionalism, good research resources, multi-platform capabilities and technological developments – saw a more mixed response.

The online sales teams swept the board when it came to the ability to prove ROI with Google coming out best overall. Its rating of 60%, together with its dominance of the online world, helps explain why it was the most popular (or certainly the most used) media owner included in the survey.

Print players also delivered well on the ROI front, with The Economist ranked second overall. Perhaps this can be attributed to the investment most have made in this category to boost multi-platform offerings. Along with The Economist, the Financial Times and Newsweek also dedicated investment to their digital offerings, which resulted in higher scores for them.

Digital investment is yet to bring the same fortune to the OOH sector. All the players failed to register double digits on their ability to deliver ROI, although recent announcements regarding measurement initiatives from both the US and Australia suggest that the sector is all too aware it needs to up its game.

The heightened importance of ROI shows very little sign of declining over the next 12 months with the majority of respondents agreeing with the statement that “cost-effectiveness is my top priority, but I expect to give more importance to creativity in 2010.” Only 5% described creativity as their top priority, reflecting the new reality.

Did media owners deliver more creative thinking?

As recession descended, media owners and agencies alike declared that smaller budgets would produce more creative thinking. Historically, some of the biggest ideas have been born during recession – take Apple for one.

By all accounts, the TV, print and online players delivered in the creativity space with National Geographic Channel’s sales team being crowned the most creative across all the platforms. The battle for second was closely contested between MSN, National Geographic Magazine, Wallpaper and JCDecaux – each pulled in ratings around the 50% mark. With the exception of JCDecaux, OOH again missed the mark in terms of offering a creative and flexible approach. Clear Channel, CBS Outdoor and Ströer trailed with ratings of 36%, 31% and 29%, respectively.

The differing of opinion between media owners and agencies on increased creativity during 2009 yet again signalled the separate paths that these two often seem to be walking.

When rating themselves, more than 60% of media owners said that they had been more creative over the past year. However, the number dropped to a lowly 36% when agencies were asked if media owners had upped their game in the creativity space. A critical 11% said they did not consider media owners to be creative at all.

While 60% of media owners claimed to have a dedicated creative solutions department, only 19% of agencies felt this was very important. On the other hand, only 5% said that it carried no importance, and evidence is mounting of the vital role media owners can take in idea creation and content delivery.

Branded content has turned out to be the star of the media owner’s toolbox as it becomes better established. More than 80% of media owners offered capabilities in this area, and nearly the same number of advertisers took them up on the offer. In terms of spend, branded content is now taking nearly 25% of the budget relative to traditional advertising (spots and banners). Online was the most popular platform for branded content with it being used by 62% of respondents, followed by TV at 44% and print with 37%.

The popularity of branded content varied across the regions. Respondents in the UK and in Continental Europe lagged behind the rest of the world in terms of usage, which can be attributed to the tighter restrictions around it.

Mobile, however, is still to show its full potential. Nearly 70% of advertisers and media owners revealed that no adspend was allocated to the platform in 2009. Respondents from outside Europe are more likely to integrate mobile into their campaigns than those within it, and 2010 is not looking any more promising for the medium with no more than 5% of budgets expected to be allocated to it.

The best of the rest

Curiously, 7% of agency respondents claimed not to allocate any adspend to online. Elsewhere though the shift of adspend dollars to online was highlighted with Google being the most used advertising vehicle over the past two years, followed by Yahoo! and MSN. BBC World News was the most used TV platform, with CNN second.

CNN narrowly took the title of the most professional sales team across all sectors, fighting off tough competition from BBC World News, Time, National Geographic Magazine and Newsweek. Professionalism was also a unifying theme across the OOH players.

MSN was overwhelming the industry leader in terms of offering new media and technological platforms, alongside its other online counterparts.

Is international media in a good place?

Pan-regional media was used by 60% of advertisers and 61% of agency respondents. On a positive note, 61% of advertisers expect to increase that budget in 2010, perhaps driven by account consolidation. That number drops to 41% for agencies.

Despite ongoing negativity surrounding print, pan-regional newspapers and magazines were only beaten by media websites as the most common types of pan-regional media used. Those in the UK were more likely to use newspapers than those on the Continent. Magazines were preferred by those in Europe and the rest of the world.

As an indication that improvements must still be made, only 7% of agencies felt pan-regional media was very effective, although that rose to 22% for advertisers. Agencies were positive on their reasoning for not using more of it, blaming national budget structures and irrelevance for their target audience. More advertisers suggested it was not accountable enough.

Among the agencies, TGI Europa was the most used of the syndicated surveys, followed by Synovate’s EMS.

Geographical divides become prominent again in regards to media owners working directly with clients. The practice is becoming more commonplace, with 50% of advertisers stating that they were ‘often’ dealing with media owners directly. Bypassing an agency to work directly with media owners was more common in the UK, 50%, and the rest of the world, 57%, than on the Continent with 46%. Only 5% of advertisers claimed to ‘never’ work directly with media owners.

Prospects for 2010

Looking forward, staffing numbers across the board are expected to rise or stay the same. Those in the UK are the most optimistic about improved work conditions, a possible result of suffering the sharpest cuts in 2009.

In terms of spend, more than 56% of those in agencies expect to shake up the way they allocate it this year; 40% expect the changes not to be significant, but only 3% expect not to make any changes at all. Their choices were in line with industry expectations that both TV and print are set to lose out to online, with agencies saying they would up spend on the platform from 15% to 20%.

Advertisers were slightly more forward-thinking than their agencies, suggesting spend online should reach 28%, cutting deeper into print than TV.

After all the cuts, there are growing expectations that this year will be marked by fluidity in the job market. When respondents were asked where they’d most like to work, Google came out on top, then BBC World News for UK employees, or CNN and ESPN for those based elsewhere.

M&M VIEWPOINT

Digital was crowned the darling of agencies last year as clients demanded more bang for their buck and tangible proof of return on investment. There is still a measure of naivety about how accountable digital really is, but other platforms clearly need to up their game to challenge perceptions, by being more innovative and skilled in ROI delivery, otherwise they will continue to lose out to digital. The recession can be credited for sharpening expectations; media owners will only have to work harder and harder to meet them.

Martina Lacey, London