The consolidation of media planning assignments may not be as visible as the consolidation of media buying accounts that transformed Madison Avenue over the past several years, but its implications are more far-reaching, especially for entrenched advertising options like television.
Unlike buying consolidations, which were spawned mainly by a drive to gain better costs and operating efficiencies, the consolidation of planning assignments is being driven by a strategic goal: to create media plans that do a better job of reaching consumers with the right message at the right time and in the right place.
The trend began with consolidated agency of record planning assignments that concentrated all of an advertisers media planning within one agency. But some of the biggest advertisers have begun creating dedicated media planning units within major ad agencies.
The first of these planning agencies within agencies was GM Planworks, which was created more than two years ago by Starcom MediaVest Group to service the nation’s largest advertiser.
Last week, SMG did it again, creating SMG/P&G, a dedicated media planning unit that will provide Procter & Gamble media planning functions that had been handled by three of parent Publicis’ shops: Starcom, MediaVest and Saatchi & Saatchi.
“I’m surprised that after GM Planworks got off the ground that other advertisers didn’t embrace it really fast. It makes a great deal of sense after you go through a media buying consolidation to have a dedicated team concentrating on your planning,” said Jim Surmanek, CEO of advertising consultant Media Analysis Plus. “If you’re a larger advertiser, it makes sense to have people who wake up every morning thinking exclusively about what they can do for that client-what kinds of bells and whistles they can bring into the planning process that go beyond syndicated research.”
Mr. Surmanek predicted this structure will be repeated among most of the biggest national advertisers over the next few years and speculated that Carat USA likely will be the next agency to set up such a unit for pharmaceutical behemoth Pfizer.
Another top advertising consultant Arthur Anderson, president of Arthur A. Anderson Associates, agreed that planning consolidation is the next big trend among agencies. Unlike consolidated media buying, which tends to “commoditize” agencies for buying media cheaper, consolidated planning accounts are designed for more strategic planning and media buying. “Media planning, media research and media strategy are seen as value-add areas. Marketers see it as a way to stretch their media dollars,” explained Mr. Anderson.
While this may make compelling sense for both marketers and media shops, the change could radically alter relationships with the media, especially television, which has been the center of media plans for most major national advertisers.
“Our point of contact with the consumer is as strategically important as the content and messages we deliver to them,” said Greg Ross, director of media for P&G North America. “This realignment made by Publicis is consistent with our plans to move aggressively beyond traditional media thinking and embrace a holistic consumer communications platform.”
While that may sound like marketing-speak, Mr. Ross is alluding to a fundamental and concurrent trend toward communications planning that is driving marketers and agencies to think well beyond the traditional media mix when devising their media strategies. Centralized media planning units such as SMG/P&G and GM Planworks are designed to facilitate that said Laura Desmond, CEO of MediaVest USA.
“It means we are looking at a broader set of options, which is both good and bad for the media vendor,” said Ms. Desmond, who oversees the East Coast operations of the SMG/P&G unit. On the upside, Ms. Desmond said the dedicated planning team intends to encourage vertically integrated media companies to develop deals that are broader and deeper than conventional media buys. The downside is that the approach will force planners to rely less on TV as the base for their plans.
“The media are going to have to understand more and more how their media assets fit into a larger whole. It’s more than just CPMs. What we are looking for is more brand-centric solutions, not just a good CPM,” Ms. Desmond said.
And because much of the work being done by these dedicated planning units is based on proprietary consumer research, media sales executives may never know exactly what is driving the plans coming out of these shops. After more than two years, many in the media industry say they still cannot detect any dramatic shift in General Motors’ media plans. But others say you need look no further than GM’s performance during the recently concluded network prime-time upfront. While other major marketers were snapping up as many GRPs as were available and at record CPMs, GM was relatively flat. The cover story has been that GM has simply shifted its emphasis from national TV options to local ones, but the real story may be part of an even broader shift in its media strategy.
Not surprisingly, GM Planworks executives won’t comment on GM’s upfront strategy, but they do suggest such moves should come as no surprise to people who closely study communications planning.
“Historically, we’ve counted eyeballs and demographics and that’s been the currency of the marketplace,” said Dennis Donlin, president of GM Planworks. In their place, Mr. Donlin said media should expect to see planning decisions “go over and above the core metrics of CPMs and GRPs.” The new mantra, he said, is creating more compelling and “brand-centric consumer contacts.”
Joe Mandese is a longtime editor and writer following the advertising business. He is a former media editor of Advertising Age and a former senior editor of Marketing and Media Decisions.