Leadership challenges and opportunities for media C-Suite executives
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How did ad agency economics become so challenging? Fee-cutting and low growth are part of the equation. CMOs, Procurement and Holding Companies share the blame for Madison Avenue's Murder.
Madison Avenue has many goals in mind, particularly in the Age of AI, but there is no consensus about its current position. What problems define the starting point for ad agencies?
All companies charge for outputs -- the number of computers, watches, cars, etc. They set premium prices where they can, average prices for most and commodity prices where necessary. It's logical.
One outcome sees improvements in relationships and advertising that drive higher brand growth. The alternative continues today's strategy of cheap, fast, understaffed and ineffective advertising.
The strategic need to drive brand growth has a higher priority than "implementing technological innovations." But there are many distracting voices, encouraging leaders to focus on other things.
Procurement needs to give back as well as take. Thus far, it has done more taking than giving. What would a positive game-plan look like?
As long as agencies have delivered outputs and received fees for the outputs, output-based pricing has been in effect. Prices, though, have been invisible. Prices can be calculated by ScopeMetrics®AI
ScopeMetrics®AI, a self-serve platform for advertisers and agencies, does all the work to shift pricing to outputs ... and then to outcomes
If relationships focus on rekindling brand growth, genuine partnerships will be reestablished. Strategic analysis of brand growth problems is a key requirement
The ScopeMetrics®AI system solves the fee issues, especially when agencies partially use AI to create ads. Ask for our template and a free trial SOW diagnosis with our on-demand AI system.
