My start in the industry came during the heyday of direct marketing: data was king and the data planner the key to unlocking the riches that the target consumer held. Stereotypically, a 28 to 35 year old housewife who regularly read the Daily Mail, enjoyed travel, eating out and cinema, had two or more credit cards and a direct debit to an animal charity, lived in a semi-detached house and had two cars parked on the drive.
Archive for the ‘Direct mail’ Category
Following their introduction in the early 1980’s, loyalty cards went from strength to strength, resulting in the UK’s loyalty programme market becoming one of the most significant in the world. However, in recent years the development of schemes has begun to stall due to market saturation. (more…)
As economists argue about whether the UK is experiencing a double or triple dip recession, business efficiency is under the microscope and advertisers are under pressure to seek out new and creative ways of achieving cost savings. One solution they are turning to is media barter.
Barter itself is an ancient business practice which conjures up images of merchants swapping their wares in a medieval market place. Media barter is the modern day equivalent, allowing advertisers and media owners to trade without having to pay completely in cash for what they want to buy. The last decade has seen media barter shift from a minority activity to a major part of many companies’ marketing planning.
In the UK alone it is worth between £250m to £300m and it’s growing. This is reflected by the fact that many of the top 20 media agencies now have a dedicated media barter specialist. So what are the main questions still asked about media barter? And most importantly, what is in it for marketers?
1. What does a media barter deal involve?
Deals brokered by media barter companies are structured according to advertisers’ individual requirements, so each one is different.
Broadly speaking however advertisers transfer the margins on their products and services to the media they want and so pay less for their media than if they were paying for it all in cash. The media barter company distributes the advertiser’s goods and services via channels they have both agreed in advance. For their part, media owners exchange their inventory for goods and services they need making effective use of a soft currency.
2. Hasn’t barter got a somewhat shady reputation?
It’s fair to say that media barter or corporate barter as it’s sometimes known hasn’t always been carried out to the highest standards. Ten years ago barter deals in the UK revolved solely around trade credits, a model that was big on promise and often short on delivery. Many deals were never delivered because the advertiser couldn’t use the trade credits and repeat deal levels were negligible. Media agencies really disliked barter because it didn’t work and it disrupted their relationships with both advertiser and media owners.
As media barter increasingly focussed on delivery, perceptions of media barter in the UK began to change. In addition, barter began to shift away from a focus on distressed inventory and more towards bartering first line product.
Done properly, media barter is a transparent and risk free way of helping advertisers to increase their media budgets and open up new channels for brand distribution.
3. What are the benefits?
Return on Investment: where an advertiser and their agency place their media through the barter company. The barter company then buys an agreed proportion of the client’s goods/services, delivering a guaranteed and unique return on investment.
Cost savings: where an advertiser is able to buy the same media for less cash, and therefore media barter contributes towards an ultimate saving.
Budget creation: advertisers can then reinvest savings into media campaigns, therefore creating additional media budget.
4. What can be bartered?
Everything from premium alcohol brands to top of the range car marques. Energy, holidays, FMCG, luxury goods, telephony, event tickets, electronics and vouchers are other examples.
5. How do I get the most out of media barter deal?
It’s important to discuss it with colleagues in sales, finance, marketing, procurement and with your media agency to get their buy-in. The process should be more a gradual consultancy than a quick sell.
Sarah Stratford, strategy director, Ais London
Everyone in marketing has looked at what Tesco has done with Clubcard with wonder, awe and a bit of envy. For 17 years now, it’s blazed a trail for how loyalty schemes should work, and what they can do for brands. Trouble is, it doesn’t look as shiny as it once did, especially now that everyone is in the rewards game.
And I mean everyone.
It’s hardly surprising that we’ve reached the stage where every brand wants to be on the loyalty bandwagon. After all, people have come to expect rewards. In some cases they even demand them. But, what with the white labelling of discounts, coupons and even whole programmes, it’s all a bit of a mush out there. Throw Groupon and its clones into the mix, and it’s not hard to see that pinning all your hopes on a loyalty scheme is a dangerous game. (more…)