Dive summary:Â
- In the latest example of online advertising becoming more transparent, Facebook has updated its policies to reinforce its ban on middlemen marking up its inventory; it's a common practice for agencies to charge their clients a fixed price on ads that are sold by auction, thus skimming that money off the top.Â
- The greater transparency, like in Facebook's policies, means there are less places for agencies to hide margin and markup; the transparency forces agencies to rely on billable hours or technology fees, which is hard to sustain.Â
- The transparency is good for brands who want to know how their dollars are being spent; many brands, like Kellogg, are choosing to buy their media directly instead of funneling through an agency.Â
From the article:Â
... "Still, as clients become more knowledgable about how their digital media is being procured, they’ll need more than their agency’s word. They’ll continue to demand greater transparency and visibility into the process.
According to Kiernan, agencies have little choice but to pull back the curtain further as a result. 'Perhaps some will try to maintain a ‘black box’, however that won’t last too long as clients are becoming way too savvy.'" ...