Earlier this month, the Association of National Advertisers (ANA) completed their investigation of ad agencies in the U.S., taking a closer look at agency practices around the country. The investigation examined some of the biggest players in the space, like Omnicom Group and Interpublic Group, and revealed many practices commonly occurring in the advertising space happen unbeknownst to the marketing partners who are footing the bill. With the scrutiny the advertising industry has received for a lack of transparency in advertising distribution and metrics, this report only adds fuel to the fire.
The ANA Report
According to the study, these non-transparent practices were found in all different fields of advertising, from digital to print to television. The biggest and most controversial finding from the study revolved around “cash, free ad space and other services” ad agencies have been accepting from media companies, according to the WSJ. In another post by the WSJ, it was noted that the amounts of these rebates were based upon how much money the agencies spent on behalf of their clients.
In previous reports, rebates haven’t been a topic of conversation, so it’s important for marketers to be aware of these new findings and recognize the impact they may be having on their campaigns. As the WSJ rightly stated, “The findings are likely to intensify marketers’ concerns that ad agencies don’t have their best interests at heart and could be allocating ad dollars in ways that benefit their own businesses, as opposed to those of their clients.”
Traditional Advertising v. Influencer Marketing
Marketers have looked to influencer marketing as a way to forgo the traditional advertising space, connecting more directly with their audience and getting more transparency into their ad spends. However, influencer marketing isn’t completely detached from transparency issues either.
While platforms like Grapevine provide brands with the opportunity to converse directly with creators, there are still many creators who are traditionally managed by agencies. Their agents are in charge of communication and negotiation, which can make it more difficult to have a completely transparent relationship between a brand and a creator. What are you paying for, and how much of it is actually going to the creator? It’s hard to know when you’re not working with a creator directly. There are plenty of great agents out there, and we acknowledge that, but 100% transparency can still be difficult to attain with middlemen added into the picture.
Transparency in Influencer Marketing
At Grapevine, we try to provide as much transparency to our brand partners as we can by allowing direct communication with creators via our platform. This gives brands the ability to be clear and straightforward with negotiation, proposals and payment with creators – and it works! Some creators who may have previously worked with an agent have foregone this option, preferring to manage their time and content themselves directly with brand partners.
As influencer marketing rises, the approach to traditional advertising is changing quickly – perhaps leading agencies to some of these newer, non-transparent business practices. In a recent Digiday article, Roberto Villazon, founder and CEO of Hi-Gloss, says, “A year ago it was more about how was the content going to look like…Now it’s, how is it being distributed and who’s going to see it.”
With influencer marketing, marketers may not know exactly what their content will look like, but they know exactly where it will be distributed. In fact, it’s not uncommon for creators to promote content across multiple social media channels, amplifying your brand message. This paired with analytics (real time view, click and conversion metrics if you’re using Grapevine!), give marketers a much more transparent view into their ad spend and performance. While there are still some issues to overcome, it’s absolutely a step in the right direction for the digital advertising space.
Interested in learning more about influencer marketing and how Grapevine can help? Click below to connect with one of our influencer marketing pros!