Production Transparency in the U.S. Advertising Industry

August 9, 2017

The ANA Production Transparency Task Force was launched in August 2016 with a specific two-part mission: (1) to assess whether there are non-transparent advertising agency practices in the U.S. production industry and (2) to assess advertiser advertising production management processes and develop recommendations for improvement.

The Task Force leveraged the insights of thirty executives from various ANA member companies sourced exclusively from its committee system and twelve organizations deemed to be subject matter experts. The report has the following conclusions:

Transparency issues exist in the production ecosystem.

  • Transparency concerns exist at multiple agencies and holding companies. Eleven of the 12 subject matter experts support this conclusion.
  • The use of agency in-house production resources is not always transparent to the advertiser.
  • Production business processes marked by agency control of the bidding system — where the agency also competes for the business — is sometimes dysfunctional and conflicted because the buyer can also be the seller of the services.
  • Non-transparent agency-controlled bidding can lead to costly, inefficient, and sub-optimal advertiser business decisions. The financial impact to marketers can be significant.
  • Where non-transparent practices exist, the production and editing competitive landscape becomes potentially compromised and unreliable. Such situations may jeopardize the health and well-being of competitors in the production and editing ecosystem.
  • The state commercial production incentive system is often not transparent to advertisers, and therefore advertisers may not be receiving the financial benefits they are due.

Improved advertising production management is within advertisers’ control. Advertiser disciplines, accountabilities, and controls for production need to be evaluated, upgraded, and restructured to substantially elevate decision-making quality and enhance disciplines and overall financial management.

  • The report provides ten specific recommendations for advertisers to address production transparency concerns.

Click the link to the right to download the full report.

Source

"Production Transparency in the U.S. Advertising Industry." ANA, 2017.