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1Australian Television Dramas Uncertain Future:How Cultural Policy is Failing Australians Produced by the Making Australian TV in the 21st Century Research TeamAustralian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansMay 20242Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansExecutive Summary This report summarises the findings of our four-year study of Australias broadcasting and production sectors and the challenges internationalisation and digital technologies pose for national screen industries and Australian stories.We identify a long period of policy making prioritising industry interests over those of the Australian community as a key threat to the creation of Australian drama that contributes to and strengthens Australian culture and identity.Digital technologies profoundly disrupted Australian television,requiring fit-for-purpose policy based on impartial sector expertise like never before.Instead,Australian cultural and economic policy objectives have been muddled and policy has consistently prioritised corporate interests.Levels of Australian television drama have declined profoundly in recent decades.The number of hours broadcast each year has fallen 55%from its peak in the early 2000s.The amount of drama broadcast each year has fallen by another 170 hours since we published the Australian Television Drama Index in 2021.At the same time hours of drama are falling,federal government spending on TV drama supports multiplies.Over the last five years,TV drama subsidies increased by an average of 19ch year,while the hours of locally produced drama on Australian television screens decreased by an average of 10ch year.The Australian dramas that remain on our screens are increasingly not stories that are specific to Australia.The burgeoning federal subsidies now also fund productions commissioned by multi-territory streamers for global audiences.Their dramas may be set in Australia but rarely engage with Australian social and cultural themes in a meaningful way.These services are focussed on maintaining international subscriptions rather than returning cultural value to Australians in exchange for the funds and tax offsets they receive.Policy has not adapted to Australian commercial broadcasters steep decline in spending on local drama made for Australian audiences,including long-running series that were once the core business of the drama production sector.Instead,commercial broadcasters have received significant concessions to their content obligations for Australian drama and childrens programs despite maintaining access to spectrum that affords them significant political and cultural power.The sectors major policy tools the producer offset tax rebate and funds administered by national screen agency Screen Australia have operated with low levels of transparency and not been subject to independent review.Both have prioritised sector economic activity over the achievement of the social and cultural objectives that historically underpinned Australian content regulations and supports.Most recently,the government has expanded industry subsidies such as the location offset with no Australian content criteria.This report focuses on the failure of cultural policy to safeguard supplies of distinctively Australian television drama with cultural and social value for the Australian community.Australians are footing the growing bill for subsidising screen production in Australia but have had little voice in policy conversations in recent years.Instead,cultural policy has overwhelmingly prioritised the interests of screen industries.The report includes an addendum that addresses economic policy for the sector.About the authorsThe Making Australian TV in the 21st Century Research team is funded by an ARC Discovery Project Grant(DP210100849)and includes Professor Amanda D.Lotz,Dr Marion McCutcheon,Professor Anna Potter,and Professor Kevin SansonSuggested citation:Making Australian TV in the 21st Century Research Team(2024)Australian Television Dramas Uncertain Future:How Cultural Policy is Failing Australians,Report,Queensland University of Technology,DOI:http:/doi.org/10.5204/rep.eprints.248187This report can be downloaded from:https:/eprints.qut.edu.au/248187/Layout and design:small t design Copyright 2024.The Authors.3Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansIndexIntroduction 4RECOMMENDATIONSFit-for-purpose cultural policy 4Four interventions 5Australian drama in crisis 7Changed playing field,lost foundation 9Endemic problems with existing policy frameworks and subsidies 12The producer offset 12Screen Australia 13Increasing focus on sector supports without any cultural test 14ADDENDUM What does this mean for Australian screen industry supports?15Economic policy priorities for industry supports 15Key adjustments in the Australian production sector 16Endnotes 22Methodology 254Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansIntroduction Cultural policy for Australian television drama is no longer fit-for-purpose,and the number of hours of drama produced each year has dropped by 55%since 2001.The production sector continues to receive substantial,and growing,public subsidies to make drama series.The Australian community is not benefiting because there are inadequate safeguards to ensure that contemporary Australian drama delivers social and cultural value in return for these subsidies.Successive governments have not addressed how digitisation has changed the business of television in ways that erode the effectiveness of policy designed for other conditions,particularly the impacts of commercial broadcasters plummeting levels of drama investment.For the last six years the dominant policy discourse has focused on content obligations for streaming services assuming these will deliver cultural and social value.The Productivity Commission made very clear the challenges facing Australian content regulations almost 25 years ago.In its inquiry into broadcasting,the commission issued a reminder that The objectives of content regulation are cultural and social rather than economic and recommended that appropriate policies should be developed for the pursuit of cultural and social objectives in the future converged media environment.1This has not happened.The primary beneficiaries of broadcasting and screen production policy reform and renewal since the Productivity Commissions report have been industry interests,not the Australian community.The demise of Australian television drama is a direct consequence of a failure to adopt policies for contemporary conditions and the blurring of cultural and economic policy priorities.RECOMMENDATIONSFit-for-purpose cultural policyPolicymakers need to establish the objectives of cultural policy for the broadcasting and screen production sectors given twenty-first century conditions and identify relative priority among them.For instance,an equivalent of the proposed objectives of the News Media Assistance Program(access,quality,media diversity,engagement)would clarify intended aims.2 Cultural objectives should prioritise the needs of Australians rather than industry,as the changed industrial context no longer enables economic supports to reliably deliver cultural outcomes.Since 2020,policymakers have focused nearly exclusively on streaming quotas as a proposed solution to a much broader problem framed as the safeguarding of Australian stories.Those efforts have been stymied by the lack of clear objectives.Policy solutions may include streamers,but the purpose of policy needs to be established first.5Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansFour interventionsCultural specificity,access,and diversity should be key objectives of cultural policy for the Australian screen sector.To that end,funding to ensure Australians have access to 5075 hours of new,varied,culturally specific drama per year must be established.Of course more than these hours of drama can and should be produced,but the change in conditions necessitates carving out support for a number of titles that reach a high bar of Australian cultural specificity in an industry geared for global audiences.These titles need greater support than current settings to reduce dependency on foreign financing and demands for reduced cultural specificity that commonly result.Culturally specific drama provides compelling accounts of the Australian experience in all its diversity.It offers Australians ways to understand their place in the world,relationships among Australians,and the challenges we face,as in dramas such as Redfern Now(ABC,201213),Gallipoli(Nine,2015),The Family Law(SBS,201619),Total Control(ABC,201924),New Gold Mountain(SBS,2021),Fires(ABC,2021),The Newsreader(ABC,2021),RFDS(Seven,2021),In Our Blood(ABC,2023),Safe Home(SBS,2023),House of Gods(ABC,2024),and Boy Swallows Universe(Netflix,2024).To be clear,this is not a call for stories with kangaroos,koalas,accents and Australian landmarks.Much like how Mr Bates vs The Post Office(ITV,2024)recently galvanised viewers in the UK in understanding a great injustice in their society,supports for dramatic examinations of Australian crises such as Robodebt,epidemic levels of domestic violence,and accounts of ongoing struggles of cohesion in a migrant and colonialist nation deliver crucial social understanding but are often dismissed as lacking international or commercial viability.Titles receiving supports intended to deliver social and cultural value to the Australian community must be accessible to all.This could be achieved through ensuring there is a non-paywalled distribution window.Titles can also be licensed to paid services,as this makes it easier for some Australians to find and view,or be sold abroad.As an objective,accessibility demands prioritising the Australian communitys ability to watch these dramas,not industrial strategies of exclusivity and scarcity.There are multiple routes by which this can be achieved,though the most efficient is to resource Australias public service broadcasters.The provision of culturally specific drama that reflects Australian society in all its diversity aligns with both the ABCs and SBSs charter obligations,with both services being widely accessible.Releasing through commonly used free services such as YouTube also supports objectives of accessibility.In 2022-23 six different paid services commissioned Australian drama.Few Australians subscribe to several let alone all of those services.It is a poor policy approach to spend taxpayer funds on content not freely accessed by Australians.Clarity is need regarding the cultural objectives of the producer offset and Screen Australia.Ideally social and cultural aims should be separated from economic development.Greater transparency and precision in goals are needed.Screen Australias conflicting mission has proven enormously challenging.Cultural and economic policy must be the remit of separate instruments because they have different metrics.The producer offsets considerable and increasing administrative load should be shifted to the Department of Infrastructure,Transport,Regional Development,Communication and the Arts that already administers the location offset.The producer offset has been the drama sectors major policy lever although the 2023 increase in the location offset may well change that.The Significant Australian Content(SAC)test needs to be revised,clarified and adequately codified to ensure the producer offset achieves its stated cultural as well as economic objectives.With appropriate reform,it could be used with more nuance to achieve a broader range of objectives that deliver better value to Australian taxpayers.Whether the same level 126Australian Television Dramas Uncertain Future:How Cultural Policy is Failing Australiansof offsets should be available to titles solely available through paid services should also be formally considered because of their limited accessibility.At this point,neither Screen Australia nor the producer offset can be depended on to reliably deliver cultural policy objectives.Without a strong SAC test for producer offset eligibility,both of these 30%subsidies(the producer offset and the location offset)are effectively functioning the same way,as industry supports,not in support of cultural policy.The ABC and SBS are key cultural institutions that should be central to delivering screen drama cultural objectives.The ABC and SBS require resourcing dedicated to this mission given they are the only institutions aligned to serving Australians and prioritising accessibility and diversity.The free-to-air availability of these broadcasters,combined with their established free-to-access,on-demand infrastructure is important given the accessibility challenges of the contemporary ecosystem.Just as founding frameworks such as the Broadcasting Services Act 1992 warrant updating for the profoundly changed conditions,so too does the ABC Charter require modernisation to acknowledge its expanded duties given the erosion of commercial broadcasters contribution to Australian society.Crucially,policy that requires public service broadcasters to ensure culturally specific,accessible,and diverse screen stories must guarantee dedicated funding and expectations for drama objectives.Enforce prosocial obligations and/or fees on entities using broadcast spectrum.Historically,Australian cultural policy was underpinned by the robust contribution of commercial broadcasters in license fees and the alignment of their market goals with providing Australian drama.Reducing commercial broadcaster obligations over recent decades has been disastrous for the Australian community in terms of their access to freely available Australian drama.Current conditions in which commercial broadcasters access public spectrum with minimal corresponding public responsibility must be rectified.Reinstating drama quotas is not effective policy,but broadcasters should contribute funds that support cultural policy in lieu,such as through contributions to a fund that could support the hours of culturally specific drama called for here.3347Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansAustralian drama in crisisHours of Australian television drama released each year by all channels and services declined significantly between 1999 and 2023:adult drama fell from 570 to 300 broadcast hours,and childrens drama more than halved,from 106 to 51 hours(Figure 1).The figures are stark and underscore a much bigger problem;many of the few remaining dramas today are not made for an Australian audience.Instead,they are commissioned by services targeting global markets.Australians once enjoyed freely available,long running series such as Blue Heelers(Seven Network,1994-2006),Water Rats(Nine Network,1996-2001),and Offspring(Network Ten,2010-17)and mini-series such as All the Rivers Run(Seven Network,1983),The Dismissal(Network Ten,1983),and Bodyline(Network Ten,1994).But drama series today are both more limited in number and provide far less of this kind of social and cultural value to the Australian community.Previous conditions in which commercial broadcasters Seven,Nine and Ten competed by commissioning hundreds of hours of drama to attract Australian viewers attention allowed policy including content quotas to deliver economic and cultural outcomes.These outcomes took the form of both many hours of work and stories that represented and reflected Australians lives.With less drama now funded by commercial broadcasters,its cost is increasingly being subsidised by Australians through tax rebates to the production sector.Such rebates prioritise economic activity over value returned to the Australian community.Many of the series receiving these tax rebates are ostensibly set in Australia but tell stories that could take place anywhere.For example,Wolf Like Me(Stan,2022-)is a romantic comedy about two Americans set in Adelaide and Lie With Me(Network Ten,2021)is an adultery thriller set in Melbourne where a couple has recently moved from the UK.Others yet are shot in Australia but set in other places,for example,Clickbait(Netflix,2021)and Nine Perfect Strangers(Prime Video,2021-).These series receive as much as 30%of their spending back in tax rebates from the federal government,and often money from state governments as well.Streaming services may be spending more per hour but their lack of meaningful engagement with any aspect of Australian society raises the question of what value the Australian community specifically receives from those funds.Over the ten years to 2023,funding for television from federal sources increased by an average of 15.6ch year,while the hours of Australian TV drama available fell by an annual average of 5.6%.Figure 1:Australian TV drama hours,1999202319992001200320052007200920112013201520172019202120230100200300400500600700Total hoursAdult dramaChildrens dramaDrama hours on Australian television have more than halved since the turn of the 21st Century.Sources:Screen Australia Drama Report and Screen Guide,ACMA Australian content monitoring reports8Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansIn 2007,as part of screen policy reforms,the Australian government introduced the Australian Screen Production Incentive(ASPI),4 which is composed of three separate tax incentives for screen production:the producer offset,the PDV offset(post,digital and visual effects)and the location offset.Nearly two decades,and more than$1.5 billion in supports later,5 the key pillars of that policy change have undergone little of the scrutiny or independent review characteristic of most sectors of government.The offsets are uncapped funds and only the producer offset considers the story and whos making it.Additionally,Screen Australia administers a general drama fund and an Indigenous drama fund with criteria ranging from cultural value to commercial viability.Figure 2:Federal government TV drama supports by scheme(2022-23 dollars)2007-082008-092009-102010-112011-122012-132013-142014-152015-162016-172017-182018-192019-202020-212021-222022-23$0M$50M$100M$150M$200M$250M$300M$350M$400M$55.9M$34.9M$77.2M$111.5M$105.8M$94.5M$79.2M$104.6M$92.9M$123.1M$133.9M$199.2M$263.2M$261.1M$299.4M21%$453.9M43%$921.3M13%$287.4M11%$241.2M11%$244.5MSum of each support scheme,2007-08 to 2022-23PDV tax offsetLocation incentiveLocation tax offsetProducer tax offsetScreen AustraliaMost government supports do not require cultural value to Australians as part of their criteria.Only the yellow segments of the figures,direct funding,considers social and cultural value.In theory,the producer offset does so as well,but its criteria allow country of production and Australian staffing to suffice.Note:Estimates of the location incentive,location tax offset and PDV tax offset assume that all TV drama productions reported in Screen Australias Drama Report receive maximum subsidies.See endnote 4 for explanation of the difference between location offset and incentive.Sources:Screen Australia Annual Reports and Drama Reports,Australian Taxation Office Film Tax Offset advice summariesThe business of making television drama for Australians has eroded,and the policies that are meant to support Australian stories are not achieving their original social and cultural objectives.Part of this crisis derives from forces beyond the control of policymakers,such as the impact of digital distribution technologies.But the failure to address the consequences of these changes has prevented policy reform to ensure cultural and social objectives are achieved for Australians.Recent policy actions have prioritised the production sector and Australian taxpayers are shouldering the costs.A combination of inadequate and imprecise policy tools with a system of supports that lacks accountability and transparency have led policy to become unfit for purpose.Australia needs to separate and redevelop its cultural and economic policy initiatives to ensure that Australians can freely access distinctively Australian stories,not merely those produced here.9Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansChanged playing field,lost foundationSince the establishment of Screen Australia(2008)and the Australian Screen Production Incentive(2007),a number of unanticipated adjustments have altered the operation of the countrys television drama sector.The playing field in place twenty years ago has been turned on its side,radically changing the context within which Australian television drama commissioning and circulation occurs.Factors changing the sector1.Commercial broadcasters profoundly reduced their drama commissioning 2.Nationally-focussed industries became globally intertwined with transnational ownership of services(Network Ten)and production companies(Matchbox,Southern Star,CrackerJack,Screentime,Playmaker,Lingo,Werner Film Productions)3.Series commissioning is increasingly reliant on multi-territory streaming services such as Netflix4.Increasing reliance on foreign funding as a proportion of drama budgetsWithin Australia,commercial broadcasters businesses were reconfigured by the fragmentation that resulted from the launch of digital multichannels in 2009.Seven,Nine and Tens new channels created extra content costs without delivering new advertiser spending.This change eroded the foundation of their profitability,as did the audience fragmentation the new channels caused.The once-robust business of commercial broadcasters has been further challenged as advertisers have gained more ways to reach potential consumers.Advertisers began moving their spending from traditional media early in the 21st century to search(Google)and social media(Meta).Initially this spending came at the expense of print and direct mail but televisions share of advertiser spending has also declined.6 Between 2006-07 and 2020-21,free-to-air televisions share of total advertising expenditure in Australia fell from nearly half to 18%.7As commercial broadcasters advertising revenue fell,they commissioned less drama.Commercial broadcasters hours of adult drama dropped from 520 in 1999 to 116 hours in 2023,a decline of 48%over the time series being considered here,with on average 13wer hours each and every year.Their expenditure on drama has also fallen:commercial broadcaster expenditure on drama decreased from$222.5m in 2002-03(14%of all program expenditure)to$71.7m in 2021-22(3%).8 Bringing these data lines together,they are spending less per hour,with average drama expenditure falling from$415,000 per hour to$219,000 per hour,nearly halving,over the same period.All figures here are adjusted for inflation.10Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansFigure 3:Australian TV drama hours,2018 to 20232000200220042006200820102012201420162018202020220100200300400500Total runtime(hrs)2000200220042006200820102012201420162018202020220100200300400500Total runtime(hrs)Combined commercialsCombined PSBsSubscriptionSVODsAdult dramaChildrens drama201820192020202120222023050100150200250300201820192020202120222023050100150200250300The decline in commercial broadcast drama hours accounts for the crisis in Australian television drama.Sources:ACMA Australian content reports,Screen Australia Drama Reports and Screen Guide,ABC Annual Reports,SBS Annual Reports,IMDb,trade press Commercial broadcasters are spending less as they commission fewer original series and increasingly rely on soaps to meet their sub-quota requirements.Fifty-nine per cent of the 116 hours of adult drama in 2023 were Neighbours and Home and Away,which,over the last 20 years,have lost as many as half of their Australian viewers(see Figure S).In October 2023,the domestic audience for Neighbours was a mere 244,000,9 accumulated over one weeks worth of viewing on broadcast and catch-up services.Its dwindling audience suggests the soap delivers limited social and cultural value to the Australian community despite accounting for most of Network Tens local drama contribution.11Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansThe marked decline in hours since 2020 is the direct outcome of the reduction of drama sub-quota requirements and elimination of childrens television content quotas for commercial broadcasters by then Minister for Communications Paul Fletcher.Since this change,adult drama on commercial broadcasting services has fallen by 47%and childrens drama on commercial broadcasting services has declined from 33 hours in 2020 to zero.For the first time since 1979,Australia has no policy requiring the provision of local childrens drama by any service.In an era when all Australian television drama was commissioned by services seeking to attract the attention of Australians,competitive dynamics ensured dramas that reflected Australian life.Streamers do not operate under these conditions;they commission for global audiences.This change requires cultural policy with more rigorous expectations.In sum,policy reform since the introduction of digital technology has been extraordinarily accommodating to commercial broadcasters without consideration of the needs of the Australian community.Commercial broadcasters were effectively handed extra spectrum at no cost in 2009 and since then their licence fees and required content contributions have been dramatically reduced.Commercial broadcasters may be less profitable,even substantially so,but they still enjoy wide-reaching access into Australians lounge rooms.This is an extraordinary yet uncalculated component of spectrum value and the basis of the quid pro quo that defined policy under the Broadcasting Services Act 1992.Globalisation and technological change have irreversibly impacted the Australian screen industries.Commercial broadcasters no longer provide the economic backbone of Australian drama.SoapsFormer Communications Minister Paul Fletchers change to the Australian Content Standard has enabled Networks Seven and Ten to cover their drama quota obligations mostly through low-cost soaps whose audiences are largely outside Australia.Long running soaps may provide valuable training grounds for Australian practitioners,but the cultural value they deliver to Australian taxpayers is less clear.With a small and decreasing local audience-base,the longevity of long-running Australian serials derives from their popularity overseas,particularly in the UK,and their function as a relatively cheap way to meet quota.Very few Australians derive significant value from these titles and their relatively low cost and high number of broadcast hours compared with new and shorter-run drama means that commercial broadcasters have little incentive to offer anything else.In December 2023,Minister for the Arts Tony Burke opened the producer offset to soap production,handing taxpayer funded supports to long running soaps for which there is no evidence of market failure:they have always been,and continue to be,very profitable due to foreign sales.Figure S:Five city metro audience for Home&Away and Neighbours19992001200320052007200920112013201520172019202120230.0M0.2M0.4M0.6M0.8M1.0M1.2M1.4M1.6M5 city metro audienceHome&AwayNeighboursNote:Time series here are smoothed by averaging available ratings data for each calendar year.Reliant on Metro data due to public availability.Source:OzTAM,collated from a variety of sources12Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansEndemic problems with existing policy frameworks and subsidies The introduction of the producer offset in 2007 and the establishment of Screen Australia in 2008 were major policy reforms intended to position Australias screen production sector for economic sustainability,including through sector consolidation.Both were designed and implemented before the advent of multi-channelling,when commercial broadcasters were the principal source of drama investment,and streaming services were largely imagined.Both have consistently prioritised industry interests over those of Australian audiences.The operations and inner workings of both are opaque.The producer offset The producer offset is an uncapped tax rebate that currently returns 30%of qualifying Australian production expenditure for television drama productions and 40%for film.In its most recent reporting year,2022-23,the producer offset certification process approved offsets valued at$125 million for television and other content(Figure 4).The amount distributed for television drama rose sharply in 2023,despite falling production levels.One of the producer offsets key aims is assisting Australian producers to build stable and sustainable production companies.10 But this tax rebate was always intended to be more than just an industry support and is also meant to deliver social and cultural outcomes to the Australian community.For this reason,eligible projects must pass a Significant Australian Content(SAC)test,that according to Screen Australia reflects the cultural policy objective of the producer offset.11Tied to historical precedent in broadcasting policy,the SAC test relies heavily on the nationalities of key creatives working in Australia for a projects eligibility or the very broad clause covering any other matters that Screen Australia considers to be relevant.12 Hiring Australians in key creative roles and producing in Australia are ineffectual criteria for the delivery of social and cultural value when drama is increasingly produced for transnational viewers,as is the case now.A project being made under Australian creative control does not guarantee it will be a distinctively Australian story,for example the movie Peter Rabbit(2018).The SAC test is inadequate as a means of ensuring the producer offset supports stories that reflect and represent life in Australia to the Australian community.Additionally,the administration of the producer offset is opaque.Tax laws prevent any information about the recipients of the producer offset being made available.We cite Peter Rabbit as it is one of the few titles publicly known to have received the offset.It is perceived likely,however,that almost all applications are successful,not least because producers tend to take Screen Australia to court if their project is deemed ineligible.The secrecy surrounding the offsets distribution makes it impossible to assess the extent to which it has supported commercially successful projects,contributed to sector sustainability,or benefitted the Australian community.13Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansFigure 4:The producer offset:TV and other2007-082008-092009-102010-112011-122012-132013-142014-152015-162016-172017-182018-192019-202020-212021-222022-2301020304050Count753535394238403633514250223351Final certificates issued2007-082008-092009-102010-112011-122012-132013-142014-152015-162016-172017-182018-192019-202020-212021-222022-23$0M$50M$100M$150M2022-23 dollars$52.2M$65.1M$76.8M$71.0M$66.1M$52.2M$60.2M$51.9M$80.2M$56.2M$81.8M$38.2M$44.2M$125.2MOffset valueCosts of producer offset continue to rise and many of the titles,perhaps as much as one-third,are now behind paywalls rather than freely accessible to Australians.Source:Screen Australia annual reportsThe last formal,public evaluation of the producer offset was undertaken in 2017 by Screen Australia based on data from a range of surveyed companies and production sector activity.Politicians,industry bodies(Screen Australia and Screen Producers Australia),and advocacy campaigns(Make it Australian)continue to call for sectoral tax rebates on the grounds they will support social and cultural objectives of Australian stories.This is by no means guaranteed given the low bar set by the SAC test and the imperative to produce for transnational audiences.Screen AustraliaScreen Australia was created in 2008 through the amalgamation of three separate agencies13 into a single mega agency supporting film and television production,along with a broad range of other activities.It has a confusing and somewhat contradictory remit with dual roles as an industry support responsible for driving sector growth and a cultural agency.Its responsibilities include a broad range of commercial,cultural and social objectives,among which are important diversity activities such as the Gender Matters initiative and First Nations programs.Screen Australia administers the producer offset in addition to its own discretionary funding programs.Combining all these functions in a single agency confers enormous power and influence,along with multiple conflicts of interest.For example,the agenda of industry growth and internationalisation that Screen Australia has consistently pursued rarely prioritises the interests and needs of Australians.Nor it is likely to be compatible with the goals of national cultural representation that the agency and stakeholders consistently invoke to justify greater financial support for the sector.Screen Australias operations lack transparency and accountability.The agency has an extremely broad remit that includes the administration of billions of dollars in subsidies,yet it has never been the subject of an independent review or analysis by the National Audit Office.Instead,Screen Australia self-assesses its performance through its annual report and the Drama Report.The latter problematically lumps together spending on all scripted content production activity in Australia,including international film productions using Australia as a non-identifiable location.The emphasis on sector economic activity in the Drama Report obscures the extent to which the offsets increasingly subsidise productions that deliver little or no social or cultural value to the Australian community and frequently benefit US conglomerates.This reporting has also concealed decreasing levels of Australian television drama production.14Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansProducers fear making a complaint to Screen Australia because of its enormous power and influence within the sector as the sole national funding agency.Its direct funding decisions are not explained or justified,and producers do not get feedback on unsuccessful funding applications.There is little that prevents its decision-making systems being abused or vulnerable to conflicts of interest,and no space for independent review in which producers can safely speak out.The agencys power also means producers are reluctant to publicly criticise any aspects of its operations in case of jeopardising future funding applications.Increasing focus on sector supports without any cultural testThe location offset was deliberately designed to attract large budget film and television projects to Australia.Initially set at 16.5%,it allowed for ministerial discretion to boost the support to 30%through a fund called the location incentive.In 2018,an additional 13.5%location incentive was introduced for eligible productions.The location offset was increased to 30%in 2023(subject to legislation),replacing the location incentive.The location offset has only economic criteria for eligibility,including a minimum spend per hour of$1.5m for drama and requirements to contribute to sector training and infrastructure.The location offset is a purely economic incentive with no cultural criteria attached.The location offset is also uncapped and unlimited.With the increase to 30%,this incentive is now of equal value to the producer offset in drama budgets,meaning even the thin cultural protections in the SAC test are irrelevant to receiving rebates for producing big budget drama.Given the spiralling per hour costs of drama production(the norm for streamers that can spend at rates supported by their global subscribers),$1.5m per hour will apply to a growing number of productions and this uncapped rebate scheme is likely to be very costly.This sizable and uncapped location incentive eliminates the pretence of cultural policy that exists in the producer offset.It delivers value to industry but not the Australian community.Much of the policymaking of the last 15 years appears to have prioritised the interests of industry(particularly those already in receipt of Screen Australia funding)rather than longstanding cultural and social priorities for Australian content.This focus on industry comes at the expense of the Australian community that funds rebates such as the location offset and in exchange receives uncertain social and cultural value.The sector lacks a clear,consistent,transparent,and accountable way to determine social,cultural and public value,despite relying on taxpayer money to sustain these subsidies.15Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansADDENDUM What does this mean for Australian screen industry supports?In this addendum we turn away from cultural policy to consider how the contemporary environment also requires reconsideration of economic policy.We maintain that the economic and cultural challenges the Australian television sector faces are not mutually exclusive but nevertheless require policy solutions that disentangle economic objectives from cultural goals.A one-size-fits-all policy approach is no longer fit-for-purpose.A considerable amount of the data our research project has collected will be useful to economic policymaking given the failure of Screen Australia and the ACMA to publish the kind of data and reports generated by the the Australian Film Commission.In what follows,we identify aspects of economic policy that warrant further investigation and note two additional adjustments that have had an impact on the production ecosystem.Australia is not a large country,and its screen production sector is vulnerable to market failure.From 2019 to 2023,federal government incentives accounted for between 21%and 36%of total expenditure on TV drama.Supports such as the producer offset have become regarded as entitlements in the sector.The government is now one of the most important investors in Australian drama,but few guarantees exist that the tax revenue foregone is generating benefits for the Australian community.Industry bodies such as Screen Producers Australia are concerned that the structure of existing supports(i.e.,the equalisation of the producer offset and location incentive)risks transforming Australia into a service industry in which local workers support productions led and funded by foreign entities.There is very little scope for writers,directors,actors and key department heads to undertake meaningful work in such an environment.There also is concern that service production makes it more difficult to develop,finance and staff productions made for the local market because of crew availability,wage inflation,competition for equipment and soundstages,and the lack of control over intellectual property.Drama expenditure data demonstrate the dominance of the international productions that have located themselves in Australia:in two out of the three years to 2023,spending on international feature films and drama was greater than all expenditure on Australian feature films and drama.Dedicated industry supports must account for the same changed conditions outlined in this report and accept more realistic aims about the size and scale of production activity appropriate for Australia.Economic policy priorities for industry supportsClear objectivesIndustry supports need clear objectives and to be separated from cultural policy.Policymakers have not openly established the aims or priorities of industry supports.For example,are industry supports designed to:Increase job numbers or ensure career longevity and professional advancement?Prioritise Australian companies or all production firms equally?Privilege screen content that is freely accessible or only available behind a paywall?Provide support indefinitely or generate a self-sustaining sector?It is unlikely the size of the Australian market,even with industry supports,can facilitate indefinite growth and ever-expanding production firms.Effective policymaking requires clear objectives informed by the logical limits of what the local ecosystem can sustain.16Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansCapacity and pathwaysOften industry supports are justified on the basis that the social and cultural goals sought by cultural policy cannot be delivered without a screen industry to make drama.This is true,but a threat of no industry activity is unlikely.Policymakers need to define sustainability for the twenty-first century context.Historically,Australia has had many small production companies,but our data suggest current and future production levels will make it difficult for more than a few to remain viable over a long term.In terms of pathways into the industry,soaps historically provided steady employment for many and were a crucial training pathway.But their training value cannot justify high levels of support given their low demand by Australian viewers.More recently,offshore productions provide for job opportunities,especially for local craft and technical workers,at a scale not possible within the domestic sector.But their value as a pathway is precarious given the competitive dynamics between national and international jurisdictions and the potentially adverse impact on the domestic production sector(e.g.,crew availability,wage inflation).They also are not guaranteed to produce content with much,if any,local cultural value to taxpayers.Pathways are an issue,but new thinking and alternatives are needed.Establishing a reliable level of annual production(50-75 hours)could be part of that solution.Returning to in-house production at the ABC may be another avenue to explore.Internationalisation of the sectorMany of Australias major drama producers are now owned by foreign conglomerates.This is the state of the industry globally,and our research does not suggest that production company ownership uniformly leads to failure to deliver social and cultural value.But it raises questions about the extent to which Australian taxpayers support these companies and their productions.Key adjustments in the Australian production sector Ownership changesOver the past 25 years,the Australian television industry has shifted from a domestic-first sector to a thoroughly internationalised business.Many of the countrys most prolific drama producers have been acquired by multi-national firms in the past decades(Table A.1),and foreign-owned companies have been responsible for more than one-third(and sometimes as much as one half)of all hours of drama produced in Australia over that same period(Figure A.1).Table A.1:The top ten producers of Australian drama(soaps excluded),ordered by number of titles,20142023 Production companyOwnershipAustralian drama 2014-2023Title countBroadcast hoursScreen Australia production fundingMatchbox PicturesAcquired by NBCU in 2011/1425199$20.2mFremantle AustraliaAcquired Pearson,which acquired Grundy in 199516188$14.3mScreentimeAcquired by Banijay in 20121499$6.3mEndemol(Shine)Aust.Acquired Southern Star in 20091274$13.4mPlaymaker MediaAcquired by Sony in 201410116$9.2mCordell Jigsaw Zapruder ProductionsAustralian owned862$4.4Jungle EntertainmentAustralian owned845$4.3Lingo PicturesAcquired by ITV Studios in 2022843$7.4mGuesswork TelevisionAustralian owned760$1.4mPrincess PicturesAustralian owned732$0.5m17Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansThis is noteworthy but symptomatic of changes in the television business around the world.In Australia and elsewhere,the significant presence of foreign-owned firms raises questions about whether they should have the same level of access to existing offsets and government supports as domestic firms.On one hand,domestic firms are disadvantaged because they lack a deep reservoir of capital,worldwide distribution infrastructure,and the creative expertise of a large-scale production firm.On the other,this is the state of the sector globally.In order to access financing,distribution,and market intelligence,production companies require access to the global structures.14 The significant decline in the total hours of local drama produced over the past quarter century is more disruptive to the Australian production ecosystem than the presence of foreign-owned production firms(Figure A.1).The years 1999 to 2023 saw the production of a cumulative total of nearly 13,500 hours of Australian drama,at an average of 537 hours per year.Throughout that period,however,drama hours trended downward as a result of the changing dynamics of the commercial broadcasters business,at an average decrease of 2.2%per annum.The decline in drama hours is most acute for domestic production firms.For example,broadcast hours of adult drama by Australian-owned production companies fell by 3.2ch year between 1999 and 2023,while adult drama hours by foreign-owned producers fell by an annual average of 0.3%(Table A.2).Excluding the considerable hours of soaps produced each year(two titles for much of the time series presented here,produced by two companies that accounted for half of total Australian adult drama output)reveals even greater differences for adult drama produced under local and international control.Hours of non-soap adult drama by Australian-owned production companies fell by an annual average of 3.5%,while hours by foreign-owned companies increased by 2.7%per annum(Table A.2).The relative decline in the number of hours produced by domestic firms means foreign firms are producing a far greater percentage of non-soap drama(Table A.2).Figure A.1:Australian adult and childrens drama hours:Australian-owned vs foreign-owned production companies19992001200320052007200920112013201520172019202120230100200300400500Total hoursAustralian producersForeign-owned production companiesHours of drama from Australian-owned production companies have fallen at a greater rate than drama by foreign-owned pro-duction companies Figure A.2:Australian adult drama hours:soaps vs other drama series1999200120032005200720092011201320152017201920212023050100150200250300Total hoursSoapOther dramaHours of non-soap adult drama have fallen steadily over the last two decades18Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansTable A.2:Average annual change in adult drama broadcast hours,1999 to 2023Including soapsWithout soapsAustralian producers-3.2%-3.5%Foreign-owned producers-0.3%2.7%Hours of adult drama from Australian producers has fallen,while hours of non-soap adult drama by foreign producers has increasedSources:ACMA Australian content reports,Screen Australia Drama Reports and Screen Guide,ABC Annual Reports,SBS Annual Reports,IMDb,trade pressLost partners:Local broadcasters and Australian production companiesThe relationships between broadcasters and producers have a strong influence on how the benefits of drama commissioning are accrued by the production industry.The nature of this relationship has changed along with the transformation of the broadcasting industry.In the decade since 2013,commercial broadcasters have commissioned from a smaller range of companies than during the first decade of the 2000s,and from fewer Australian-owned companies(Figure A.3).Between 2014 and 2023,66 per cent of all drama hours were produced by the top 10 production companies.Five of the top seven producers were foreign-controlled.The commercial broadcasters approach to supporting the Australian production sector has varied.The Seven Network largely self produces,which creates Australian jobs and ensures that the revenue from foreign sales comes back to Australia.The Nine Network historically spread its commissions across several production companies,many of which are among those that were acquired by foreign entities in the late 2000s.Nines drama commissions dwindled to two series in 2022 and one series in 2023,with two of those series coming from a single,foreign-owned production company.Network Ten has consistently turned to Fremantle,with it producing more than 80%of its drama productions.Notably,whether by chance or policy,the ABC has an established record of working with a highly diverse group of content providers,78%of which are Australian-owned,providing opportunities for independent and emerging drama producers(Figure A.4).There will be implications for the sustainability of the remaining Australia-owned production companies as streamers produce more,and perhaps eventually the most,hours of drama in Australia.Recommendations are difficult without clear objectives.The sector is likely on the verge of a new dynamic the data from 2022-23 suggest a trend towards considerably more government spending.Enacting an uncapped 30%location offset will have significant costs and alter the content mix.Streamers are likely the only commissioners spending enough to reach the new location offset spending threshold.These services will likely opt for the location offset instead of the producer offset in the future,allowing them access to millions in tax rebates without delivering the Australian stories the sector and politicians have claimed central to new policymaking.19Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansFigure A.3:Australian TV drama broadcast hours 2014 to 2023:top 10 production companies for each service Commercial broadcastersSeven NetworkNine NetworkNetwork TenSeven NetworkEndemol(Shine)AustraliaYoram Gross/Flying BarkBogan EntertainmentAmbience EntertainmentScreentimeChocolate Liberation FrontAntichockoMatchbox PicturesEvery CloudPlaymaker MediaNorthern PicturesEasy TigerSLRBlue RocketStudio MoshiScreentimeYoram Gross/Flying BarkJungle EntertainmentSticky PicturesFremantle AustraliaCordell Jigsaw ZapruderAmbience EntertainmentJonathan M ShiffMoody Street KidsEndemol(Shine)AustraliaSouthern StarSLRScreentimePlaymaker Media1101001,000Hours LOG SCALE1,035363124211717161414584542332924241715101,080383332312423201413Public service broadcastersABCSBSMatchbox PicturesGuesswork TelevisionEssential Media&EntDecember MediaHoodlum EntertainmentScreentimeFremantle AustraliaGristmillPlaymaker MediaLudo StudioMatchbox PicturesNed Lander MediaLingo PicturesMagpie PicturesSubtext PicturesGoalpost Pictures AustraliaCloserBlackfella FilmsAquarius FilmsAmbience Entertainment050100150Hours12052503732313028232315975444444Foxtel and streamersAustralian SVODsForeign SVODsFoxtelRoadshow Rough DiamondPlaymaker MediaScreentimeEvery CloudTwo Brothers PicturesSweetpotato FilmsMade Up StoriesFremantle AustraliaCurio PicturesAquarius FilmsHoodlum EntertainmentMatchbox PicturesHelium PicturesPop Family EntertainmentFremantle AustraliaSee-Saw FilmsWerner FilmSeven NetworkGuesswork TelevisionCurio PicturesFremantle AustraliaSeven NetworkThe Comedy ChannelSee-Saw FilmsMatchbox PicturesEasy TigerBogan EntertainmentLingo PicturesPlaymaker MediaWarner Bros.Int.TV Prodn050100150Hours311311877766624211613121099888242201817141412109Australian producersForeign-controlled production companies20Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansFigure A.4:Australian TV drama broadcast hours 2014 to 2023:adult drama broadcast hours by production companyABC19992000200120022003200420052006200720082009201020112012201320142015201620172018201920202021202220230102030405060708090100110120Total hours43.8110.5114.564.146.030.322.43.020.833.028.851.344.466.673.294.862.069.970.657.872.940.658.648.745.2Main production company,ordered by number of broadcast hoursBeyond Entertainment Pty LtdScreentime Pty LtdMatchbox Pictures Pty LtdAustralian Broadcasting CorporationEssential Media&EntertainmentGuesswork Television Pty LtdGannon Television Pty LtdDecember Media Pty LtdEvery Cloud Productions Pty LtdHoodlum EntertainmentSouthern Star EntertainmentRuby Entertainment Pty LtdPrincess PicturesFremantle AustraliaGristmill Pty LtdArtist Services Pty LtdWorking Dog Pty LtdJungle Entertainment Pty LtdBlackfella Films Pty LtdPlaymaker Media Pty LtdPorchlight Films Pty LtdJAHM PicturesTwenty 20 Pty LtdBunya Productions Pty LtdHigh Wire FilmsEasy Tiger ProductionsEastway CommunicationWerner Film Productions Pty LtdScarlett Pictures Pty LtdLingo Pictures Pty LtdGoalpost Pictures Australia Pty LtdRoadshow Rough DiamondGreat Western Entertainment Pty LtdJigsaw Entertainment Pty LtdBurberry ProductionsStarchild Productions Pty LtdFox Television Creative AustraliaEndemol(Shine)Australia Pty LtdCordell Jigsaw Zapruder ProductionsCloser Productions Pty LtdBlacket Television ProductionAquarius FilmsVan Vuuren Bros Pty LtdSticky Pictures Pty LtdHarvey Taft ProductionsMcElroy All Media Pty LtdRiley Turner Productions Pty LtdSynchronicity FilmsShadowfax TV Pty LtdMums Spaghetti Pty LtdArenamedia Pty LtdWooden HorseKojo Studios Pty LtdRevlover Films Pty LtdBrindle Films Pty LtdHavent You Done Well ProductionsSkit Box Pty LtdTaylor MediaChaser BroadcastingC-KOL Pty LtdOrange Entertainment Pty LtdGiant Dwarf Pty LtdQuail Television Pty LtdJDR Screen Pty LtdMad Kids Pty LtdEpic Films Pty LtdRKPix Pty LtdPhotoplay Films Pty Ltd21Australian Television Dramas Uncertain Future:How Cultural Policy is Failing Australians1999200020012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023NetworkTenNineNetworkSevenNetwork050100150200Total hours050100150200Total hours050100150200Total hours220.0136.0149.0163.9189.3164.5148.0172.0146.5204.3113.8112.8155.8145.0163.8165.7136.0136.4147.4146.7157.8137.998.265.736.0106.089.8109.086.089.070.080.059.065.069.735.348.146.328.420.522.820.925.835.426.816.018.716.910.64.0193.7184.5220.2204.9178.2169.2235.1144.9151.3183.5158.4129.4150.7144.8144.8136.7114.1133.6125.9110.7118.1100.4123.283.697.5Main production company,ordered by number of broadcast hoursSeven NetworkFremantle Australia/Grundy TVSouthern Star EntertainmentScreentime Pty LtdMillenium Television Pty LtdBeyond Entertainment Pty LtdPlaymaker Media Pty LtdMcElroy All Media Pty LtdJim Henson Television LtdCoote/Hayes Holdings Pty LtdEndemol(Shine)Australia Pty LtdWorking Dog Pty LtdCordell Jigsaw Zapruder ProductionsEasy Tiger ProductionsKnapman Wyld TelevisionCrackerjack Productions Pty LtdCornerbox ProductionsJigsaw Entertainment Pty LtdNine NetworkEvery Cloud Productions Pty LtdBurberry ProductionsMatchbox Pictures Pty LtdRoving EnterprisesCoxKnight ProductionsAntichocko Productions Pty LtdJungle Entertainment Pty LtdNew Wave Entertainment Pty LtdGNW TV Pty LtdHoodlum EntertainmentChapman Pictures Pty LtdPrincess PicturesJonathan M Shiff Productions Pty LtdRadio KarateLingo Pictures Pty LtdNetwork TenNew Town Films Pty LtdGoalpost Pictures Australia Pty LtdRed Heart ProductionsFox Television Creative AustraliaCorner Store Films Pty LtdBeach Road PicturesCurio Pictures Pty LtdFebruary Films Pty LtdSubtext PicturesRiley Turner Productions Pty LtdLiberty and Beyond Productions Pty LtdGood News Week ProductionsStepmates StudiosRoadshow Rough DiamondOldboy ProductionsHuntaway FilmsHumdrum Comedy Pty LtdHallmark EntertainmentFree Spirit CreativeMushroom Pictures Pty LtdRobot Army Productions Pty LtdColumbia Tristar TelevisionDecember Media Pty LtdFreehand ProductionsCockatoo Colab Pty LtdMore Sauce Pty LtdImage Fusion22Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansEndnotes1 Productivity Commission(2000)Broadcasting Inquiry Report,Report No.11,3 March,https:/www.pc.gov.au/inquiries/completed/broadcasting/report,p.379.2 The December 2023 News Media Assistance Program Consultation Paper lays out and defines objectives of access,quality,media diversity,and engagement.A similar exercise establishing the purpose of screen policy is needed.3 See,for example,the fund suggested in the Convergence Review(2012,p.XI).Several countries aggregate funds from different sources to support the creation of titles that meet cultural policy goals or that defy market priorities.4 The Australian Screen Production Incentive is a set of supports that provides tax incentives for film,television and other screen production in Australia.It includes four separate programs:Producer Tax Offset.Originally set in 2007 at 40%of a companys total qualifying Australian production expenditure(QAPE)for feature films or 20%for films that are not a feature film,since 2021 the producer offset has provided a refundable tax offset of 40%of total QAPE for feature films and 30%for other eligible projects including TV drama.Productions must meet minimum duration requirements and QAPE thresholds.For a television drama series,eligibility thresholds are a single episode of at least one commercial hour or a series of at least two episodes of half an hour,and$500,000 for a single episode or hour or$1 million for a series of at least two episodes.Location Tax Offset.The location offset is available to productions that do not satisfy the SAC test.The offset was calculated at 15%of QAPE for films commencing before 2011 and at 16.5%for those commencing after 2011.A producer can access the location offset only if it has been issued a final certificate by the Minister for the Arts and it is either an Australian resident company or a foreign company with a permanent establishment in Australia.Location Incentive.From the outset of the Australian Screen Incentive,the Minister of the Arts could offer ad hoc grants to supplement the location offset to keep it competitive with subsidies available overseas,up to 30%of QAPE.In 2018,the Australian Government set aside$140 million as the location incentive fund which could add 13.5%to the location offset.In 2020,the government set aside another$400 million,which was intended to last until 2026-27 but was fully subscribed by 2023.In its 2023-24 Budget,the Australian Government announced that the location incentive would cease in July 2023 and be replaced by an increased location offset rate of 30%.Along with increasing the location offset rate,thresholds for accessing the offset were to increase:minimum QAPE per hour increased from$1m to$1.5m and minimum total QAPE increased from$15m to$20m.There were also new requirements for training and undertaking PDV with an Australian provider.At the time of writing,the proposed changes had not been legislated,with Treasury undertaking a review of the location offset and the producer offset in February 2024.Post,digital and visual effects(PDV)tax offset.Originally 15%of QAPE relating to PDV production,since 2011,the PDV has been set at 30%.Like the location offset,it is available only if a final certificate has been issued by the Minister for the Arts and the company is resident in Australia.Total QAPE related to PDV must be at least$500,000.Also,many states and territories have similar incentives that can be stacked with the federal programs.5 Including the value of Screen Australia TV drama production funding and producer offset values reported in Screen Australia annual reports,and estimates of the PDV and location offsets and location incentive by applying offset rates to foreign drama expenditures reported in Screen Australia drama reports.6 Commercial broadcaster revenue dropped substantially from 2005 and stock prices plummeted from 2009 as they failed to innovate.Their licence fee payments to the Federal Government also fell substantially from 2009.In response to commercial broadcasters arguments that changes in market conditions had compromised their ability to deliver Australian content,Parliament replaced the Television Licence Fees Act 1964 with the Commercial Broadcasting Tax Act 2017.This change functionally eliminated the policy quid pro quo that ensured commercial broadcasters return value to Australians in exchange for use of public spectrum.23Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansCommercial broadcaster financial time series(2023 dollars)197919821985198819911994199720002003200620092012201520182021$0.00B$0.50B$1.00B$1.50B$2.00B$2.50B1.Total revenue20072008200920102011201220132014201520162017201820192020202120222023$0$10$20$302.Closing price197919821985198819911994199720002003200620092012201520182021$0M$100M$200M$300M$400M3.Licence fee and broadcasting taxNineSevenTenNine Entertainment HoldingsSeven West MediaTen Network HoldingsCommercial licence feeCommercial broadcasting taxNote:The gap in the Total revenue chart marks the break between two available time series.From 1979 to 2006,total revenue is taken from the ABA and ACMA Broadcasting Financial Results From 2012 to 2023,the source is IBISWorld reports on the free-to-air broadcasting industry.Sources:ACMA Annual Reports,ABA and ACMA Broadcasting Financial Results,Eikon for Datastream,IBISWorld Free-to-Air Broadcasting industry reports7 Comparing industry demand for Australian advertising services as captured in the National Accounts with online advertising expenditure estimated by PWC for IAB Australia reveals that free-to-air televisions share of advertising expenditure halved in real terms between 2006-07 to 2020-21,from$7.7 billion to$3.8 billion.At the same time,advertising expenditure with global online services increased from$0.1 billion to$10.8 billion,representing more than half of all advertising expenditure in Australia in 2020-21.Use of Australian advertising services(2022-23 dollars)200720082009201020112012201320142015201620172018201920202021$0B$5B$10B$15B$20B$25B$17.7B$19.4B$17.7B$18.6B$18.1B$18.5B$18.4B$19.3B$20.3B$20.4B$19.6B$18.8B$21.2BOnline advertising-global servicesInternet publishing-advertising servicesSubscription broadcasting servicesRadio broadcasting servicesPrint advertisingFree-to-air television broadcasting servicesNote:The value of online advertising as estimated by IAB Australia and PWC includes expenditure with domestic and international providers.Here the value of domestic internet publishing is subtracted from the IAB total to obtain an estimate of Australian advertising expenditure on global services.Source:ABS National Accounts Input Output tables,IAB internet advertising expenditure24Australian Television Dramas Uncertain Future:How Cultural Policy is Failing Australians8 Expenditure on programming by commercial television licensees(2022-23 dollars)20002001200220032004200520062007200820092010201120122013201420152016201720182019202020212022$0.0B$0.5B$1.0B$1.5B$2.0B$2.5B$1.6B$1.8B$1.7B$1.7B$1.7B$1.9B$1.9B$1.8B$1.9B$2.0B$2.4B$2.3B$2.1B$2.0B$2.0B$2.1BAustralian sportAustralian light entertainmentOverseas dramaAustralian news and current affairsAustralian adult dramaOverseas other programmingAustralian other programmingAustralian childrens drama&otherNote:Missing data reflects years when the ACMA did not publish this time series.Source:ABA and ACMA Commercial TV program expenditure9 Haigh,J.2023,Neighbours axed from timeslot after ratings disaster,.au,6 October,https:/.au/entertainment/tv/neighbours-axed-from-timeslot-after-ratings-disaster/news-story/3487e52d9b0677d5f8d9e6de312bbff610 The producer offset was intended to:assist the industry to be more competitive and responsive to audiences,by backing producers to take their projects to market;to provide a real opportunity for producers to retain substantial equity in their productions;to encourage Australian talent to return home to work on Australian projects;to attract foreign investment,encouraging diverse projects of scale and global ambition;and to encourage private investor interest in the screen industry(Screen Australia 2017 Skin in the Game,the Producer Offset Ten Years On.)11 Screen Australia 2022,Producer Offset Guidelines,March.p.11 https:/www.screenaustralia.gov.au/getmedia/70b2fae6-232c-4a48-be6d-e970aead20d9/Guidelines-producer-offset-2022.pdf12 Ibid.13 Screen Australia was created by the Australian Government to replace the Australian Film Commission,the Film Funding Corporation and Film Australia.14 Doyle,Gillian,Paterson Richard and Kenny Barr.2021.Television Production in Transition:Independence,Scale,Sustainability and the Digital Challenge.London:Palgrave;Esser,Andrea.2017.“TV Format Sector Consolidation and Its Impact on the Configuration and Stickiness of the UK Entertainment Production Market.”International Journal of Digital Television 8(1):14365.25Australian Television Dramas Uncertain Future:How Cultural Policy is Failing AustraliansMethodologyThe primary sources of drama production data for this analysis are Screen Australias Drama Report and Screen Guide.While the Drama Report publishes information about drama programs in production in Australia by financial year,it is not a census so we have cross checked its listings against Screen Australias online Screen Guide to gain consistent information about production companies and seasons.We also identified the calendar year of broadcast(season year)for each title through desk research using sources such as broadcaster annual reports,IMD,trade press and news articles in Factiva,Wikipedia,and general internet searches.The following guidelines ensured consistency across the database:Production companies:Titles are allocated to the production company with the main responsibility for production decisions.Where the Screen Guide does not unequivocally identify the production company,we used desk research to identify the producers.Production companies are named consistently over time.In the case of acquisitions and emerging partnerships,the production company named is the entity in existence in the year of production.Co-productions:We included only co-productions identified as official co-productions by Screen Australia.Telemovies are not included in the analysis.Exceptions are telemovies produced as a series or associated with a drama series.Series commissioned by subscriber-funded,video on demand services are included;series uploaded to services such as YouTube are not.Childrens drama includes live action drama and animation.It encompasses C and P content produced in fulfilment of CTS quotas requirements as well as national broadcasters drama and animation.26Australian Television Dramas Uncertain 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Build a Media Network from the Ground Up with the Right Frame of MindThe Media Network MindsetTable of ContentsA thriving media network begins with the right frame of mindChapter 1.How media networks unlock new valueChapter 2.Organizational change:commit to new ways of doing business Chapter 3.Customer centricity:serve more than one customerChapter 4.Data centricity:get more out of dataChapter 5.Omnichannel:meet customers where they areJoin the media network revolution03040609111416Publicis SapientMedia Network Playbook|02Media networks are the future.By 2030,the retail media network market is projected to exceed$231 billion.Individual businesses can capture this opportunity and open up new revenue streams that yield a high return on investment(ROI).Media networks are not only transforming the way advertisers reach customersthey are also transforming the way businesses operate:what capabilities they have,how they organize around their media network and what partnerships they need to succeed.Launching a successful media network involves more than just collecting and selling data,adding a tech stack or investing in marketing technology.The process of building a media network is a holistic,comprehensive and complex process.To succeed,organizations need to make the right mindset shifts.These shifts revolve around four core areas:organizational change management,customer centricity,data management and channel optimization.Having the right mindset is the most powerfuland underratedtool that businesses can have when they join the media network revolution.A thriving media network begins with the right frame of mindPublicis SapientMedia Network Playbook|03Want to get the most value out of owned data?Media networks help businesses do that.They enable organizations to leverage first-party data and open new revenue streams through incremental purchases,all while serving as a bridge between organizations,customers and advertisers to facilitate more personalized,targeted interactions.HOW MEDIA NETWORKS WORKIt all starts with data.Businesses harvest and analyze data from a variety of customer touchpoints,including loyalty programs,guest rewards,website interactions and in-store transactions.They can leverage this data to derive actionable insights.A retail or travel company with a loyalty program,for example,can collect consented data on customer purchase history,preferences and behavior.By analyzing this data,the company can then identify trends,segment customers and tailor marketing efforts to individual needs.Media networks create new business opportunities for brandsthey enable organizations to monetize their data by sharing insights and impressions from it through advertising partnerships and sales.These partnerships allow advertisers to access the precise targeting capabilities offered by media networks,ensuring that their ads reach the right audience at the right time.Chapter 1How media networks unlock new valueAudienceDataBrands selling ad placements at their owned propertiesBrands monetizing their first-party data by allowing advertisers to deliver more targeted advertisements through external channelsPublicis SapientMedia Network Playbook|04Owned propertiesTHE VALUE PROPOSITIONMedia networks offer immense value to three stakeholders:Retail,travel and financial services organizations:Provide an additional revenue stream and enhance customer engagement through personalized marketing Advertisers:Increase advertising performance through enhanced targeting capabilities,ensuring that ads reach the right audience at the right time and drive incremental purchases Customers:Receive more relevant and timely offers and impressions,improving the overall customer experience through increased personalizationWhich organizations stand to benefit from media networks?While retailers are often the first to come to mind,many other types of businesses can reap rewards:Businesses with robust first-party data:Companies possessing extensive data from loyalty programs,guest rewards and other sources can leverage media networks to enhance customer engagement.For example,a hotel chain with a loyalty program can use its network to offer personalized promotions to frequent guests.Businesses with the ability to measure incremental purchases:Media networks can help businesses sell more products through increased customer engagement,driving growth and innovation.Financial services companies are launching media networks tied to incremental transactions as an optimization metric.Media networks in actionPublicis Sapient partnered with an American supermarket chain to build out its media network by helping construct the grocers channel strategy,campaigns and data infrastructure to support its new network.Over the course of three years,the network generated$100 million in revenue.For instance,a fuel retailer might partner with a soft drink brand to promote their products through targeted ads delivered through the stores app.By leveraging the stores first-party data,brands can optimize their advertising campaigns against incremental transactions,both in-store and digital,resulting in higher ROI for their advertising spend.Its a win-win for the store,the brand and the customer.Publicis SapientMedia Network Playbook|05Chapter 2Organizational change:commit to new ways of doing businessOld mindset:Media networks are just an add-on to what we already do.New mindset:Media networks are a standalone function that requires distinct strategies and capabilities and,most critically,a different customer.We understand where the money is in Media Networks and how to engage with advertisersLaunching a media network requires a fundamental shift in how organizations view their media sales and operations.Media network success requires a sales organization that understands the different requirements of a variety of media buyers.Meeting the KPIs of those buyers is enabled through media operations.Function Commercial/product buyingE-commerceShopper marketingBrand marketingMedia agenciesFocusRetailer stores revenuesR revenuesBrand and retailer equityBrand loyaltyBrand goalsKPIs Share of shelf(in-store and digital shelf)Share of display/features availablityShare of digital shelfTargeted activation enabled by customer and retail data insightsBrand awareness/considerationMedia spend effectivenessTypical use case Product listing Leaflet promotion Product search ranking Sponsored products New product trials Personalized promotion New product awareness Seasonal advertising Connected TV Performance mediaShare of budgetTrade terms budgetE-commerce activationShopper marketing budgetBrand marketing budgetBrand media budgetPublicis SapientMedia Network Playbook|06MEDIA NETWORKS KEEP THE CUSTOMER ENGAGEMENT FLYWHEEL SPINNINGMedia networks are not just an add-on to an organizations existing way of doing business.If built and executed correctly,a media network is a crucial part of the customer engagement flywheel.By targeting the right customers and optimizing against incremental transactions,media networks drive greater engagement and loyalty.Loyalty,in turn,strengthens a media network,thus creating a virtuous cycle of engagements and transactions.IDENTIFY THE RIGHT CAPABILITIES FOR MEDIA NETWORKSMedia networks rely on specific capabilities that bring together multiple corners of an organization.In evaluating their organization for the right capabilities,these are some of the questions that businesses should ask themselves:Can the organization already perform in-flight reporting?Media networks need access to real-time analytics for in-flight campaigns so that businesses can make the most out of them.To do this,they need an agile,robust and de-siloed tech infrastructure.Are ad unit exposures connected to loyalty programs or transactional data?Integration is key.Businesses will need to link ad exposures to customer and transactional data.Do leaders recognize the strategic value of media networks,and can they commit to investing in the necessary capabilities and infrastructure?Leadership clearly understands the media network opportunity to grow revenue and margin.However,they must commit to investing in the necessary capabilities and infrastructure to support them.Without top-down support,the process of standing up a media network may face resource constraints.Commerce and media networks enabling the customer engagement flywheelCustomer ID CommercetransactionsLinking on-site and off-siteMedianetworkExtend scaled partnerships and impressionsBuilding trust and contact abilityLoyaltyTo begin to understand where there may be capability gaps,businesses must understand what their organization can currently doand where it still needs to grow.1.Monetizing data at scaleMedia networks enable brands to build true personalization and scaled impressions enable data and insights as a service for wholesale and franchise partners2.Scaling loyalty and commerceLoyalty creates the vehicle to drive communication of your value proposition while earning the trust of our customers with progressive consent techniques3.Connecting customer data and transactionsContinue improving customer data and the legal and regulatory compliant techniques that enhance customer contact abilityPublicis SapientMedia Network Playbook|07COLLABORATE INTERNALLY AND EXTERNALLYThough media networks may seem like they are part of the marketing organization,they need to stand out as their own function within the company while still working toward common business goals.They should not be bundled with other functions since their focus,metrics and goals are distinct.For example,while brand marketers drive awareness,shopper marketers drive purchases and media networks drive incremental purchases.Media networks can work in tandem with these other parts of the business by delivering personalized ads that both build brand awareness and drive sales.Creating a dedicated media network team is essential.This team should include sales,data analysts,marketing strategists,user experience and technology experts who can collaborate to optimize the media networks performance.The team should also work closely with other departments to ensure alignment and integration.Organizations can either develop the capabilities to run the media network themselves or rely on external partners.Organizations must establish dedicated teams responsible for a number of functions,including:Data analysis to enable closed-loop measurement and segmentation capabilities Ad serving expertise Partner management enabling off-site offeringsMedia networks also need the right external partnerships,which can fill capability gaps within an organization and bring new value.Some types of external partners might include:Data collection and engineering Identity resolution capabilities and signal loss mitigations Advertising networks enabling off-site advertisingMedia networks in actionPublicis Sapient collaborated with a successful fuel retailer to implement its media network.By leveraging the organizations extensive first-party data,Publicis Sapient helped develop a media network that delivered personalized promotions to customers.This organization opted to enlist Publicis Sapients support rather than building its own internal capabilities.The partnership not only enhanced customer engagement but also generated significant incremental revenue for both parties.Publicis SapientMedia Network Playbook|08If media networks have a hero,its the consumer,the person at the center of the network.Businesses want to move them.Advertisers want to connect with them.But the person who purchases a bag of chips from a fuel station or books a flight with a mobile app is not the only customer that media networks serve.They serve two customers:the end user and the advertiser.Both groups have unique needs and expectations that businesses must balance as they build out their network.CUSTOMERS WANT THE RIGHT PRODUCT AT THE RIGHT PRICEPersonalized recommendations and targeted promotions can significantly enhance the customer experience.Building a 360-degree view of each customer and integrating personalized experiences is crucial.Personalization should be seamless,unobtrusive and relevant.For example,a customer browsing an online store should receive personalized product recommendations with contextual and personalized ad impressions.ADVERTISERS WANT TO REACH THE RIGHT CUSTOMER AT THE RIGHT TIMEAdvertisers aim to reach the right audience with their messaging.Precise targeting maximizes the impact of their campaigns.(continued on next page)Chapter 3Customer centricity:serve more than one customerOld mindset:I already know my customer and what they want.New mindset:Consider the needs of advertisers.Publicis SapientMedia Network Playbook|09To engage the right customer,they need access to the right kind of measurement.This enables them to make informed decisions about how to engage customers,whether through promotions or brand messaging.For example,an advertiser may use customer purchase history to determine the best time to offer a discount.Advertisers have specific goals and need access to specific data so that they can understand campaign performance and how to optimize.These may include metrics such as click-through rates,conversion rates and return on ad spend.BALANCING NEEDSThe key to a successful media network is balancing the needs of advertisers and customers.Ensuring that ads are relevant and provide value to customers enhances their overall experience.Irrelevant or intrusive ads can lead to customer dissatisfaction and reduced engagement.Therefore,media networks must prioritize ad relevance and value,ensuring that the advertising content aligns with customer interests and preferences.Publicis SapientMedia Network Playbook|10Data is the heart of media networksbut not all data is created equal.Media networks rely on quality,accurate and relevant data to satisfy advertisers needs.At the same time,running a media network is not the same thing as acting as a data broker since data should be actionable and insightful.COLLECT THE RIGHT KIND OF DATAOrganizations need the right systems in place to bring together a variety of first-,second-and third-party data in a privacy-compliant way.First-party data includes information collected directly from customers,such as purchase history and preferences.Second-party data is obtained from trusted partners,while third-party data is aggregated from various external sources.Media networks must provide advertisers with the kind of data that they need and want.This data should be:1.Clean and compliantClean data is reliable and provides a solid foundation for analysis and decision-making.Often,cleaning data requires external partnerships,though some data cleaning can be done internally.Progressive consent is a critical enabler.2.Measurable across channelsAdvertisers must be able to access data,no matter what platforms,systems or stacks an organization uses.Media networks that work across partners and platforms require clean rooms.3.AttributableAdvertisers need the ability to track transactions back to certain campaigns so that they measure and optimize them.In order for a media network to be useful,organizations building one must ensure that they have the ability to do attribution.Chapter 4Data centricity:get more out of dataOld mindset:I already collect and use data to make decisions.New mindset:Optimize the right data for maximum value with clean rooms.Publicis SapientMedia Network Playbook|11PROTECT CUSTOMER IDENTITYData privacy and security remains top of mind for customers around the world.Publicis Sapients 2023 Customer Data Survey revealed that 80 percent of respondents self-identified as extremely,very or somewhat concerned about companies using their data.Customers are not the only ones harboring this concern.Governments around the world are increasingly adopting data protections.Though they vary by region,regulations govern how data is collected,stored and used.What can businesses do to ease these concerns and ensure that their media networks align with evolving regulations?Implementing consent management systems allows customers to control their data and provide explicit consent for its use.This enhances transparency and builds trust with customers.Organizations standing up media networks should also have identity resolution measures in place.Identity resolution is the process of linking data points from various sources to create a unified view of the customer.Identity resolution providers play a crucial role in anonymizing and securely processing data,ensuring compliance with privacy regulations and protecting customer information.This involves matching customer data across different touchpoints and channels,ensuring accurate and consistent profiles.Collaborations with identity resolution partners can help resolve identity and ensure accurate data collection and measurement.Identity resolution is critical for linking disparate data points and creating a unified view of the customer.Epsilons COREID,an identity resolution solution,shows how businesses can leverage data to create accurate and comprehensive customer profiles,enabling more precise targeting and personalized marketing efforts.COREID integrates data from various sources,ensuring that customer identities are accurately resolved and linked across different touchpoints.This comprehensive view of the customer allows businesses to deliver more relevant and timely messages,enhancing customer engagement and driving higher conversion rates.Publicis SapientMedia Network Playbook|12BUILD THE RIGHT TECH STACKS TO LEVERAGE DATATechnology stacks can make or break a media network.Platforms should integrate seamlessly with existing and new systems,including customer relationship management systems,data management platforms and ad servers.They should also be able to trace,track and process large amounts of data.Implementing reporting dashboards to surface and analyze data provides a visual representation of key metrics,enabling stakeholders to monitor performance and make data-driven decisions.Publicis Sapient and Googles RMN Accelerator supports and streamlines reporting to enhance data-driven decision-making and campaign management.By consolidating data from various sources,the tool provides a comprehensive view of campaign performance,enabling advertisers to optimize their strategies.This allows advertisers to track key metrics,such as click-through rates and conversion rates,in real time,facilitating more informed decision-making.For onboarding data,platforms like LiveRamp enable organizations to put their data in one place.This gives them a unified view of their offline and online data.Publicis SapientMedia Network Playbook|13To maximize the impact of media networks,organizations must adopt an omnichannel approach that integrates both online and offline channels.While digital channels are significant,media networks also operate through various offline channels,creating a cohesive and enhanced customer journey.LOOK BEYOND DIGITAL CHANNELSWhile online channels are crucial,they are not the only way to reach customers.Most industries,such as retailers,operate in an omnichannel offering.Mirroring the customer experience,media networks can and should leverage“offline”touchpoints,such as in-store displays and kiosks,to deliver personalized messages,share promotions and capture a broader audience.For instance,a retail store can use digital signage to display targeted ads based on customer demographics and behavior.Interestingly,in-store provides a stronger non-endemic value proposition than digital experiences.This personalized approach enhances the shopping experience and drives higher engagement.Chapter 5Omnichannel:meet customers where they areOld mindset:Media networks are only about digital experiences.New mindset:Integrate both online and offline channels for a seamless customer journey.Publicis SapientMedia Network Playbook|14CREATE SEAMLESS EXPERIENCESWhat is one thing that the most successful media networks have in common?Theyre invisible.If a customer sees the media network in action,then the business is not executing it successfully.Media network advertising needs to be contextual so that customers find it relevant.Successful media networks integrate online and offline channels to create a cohesive and enhanced customer journey.Developing an omnichannel strategy that encompasses all touchpoints ensures a consistent and engaging experience for customers.For example,a customer browsing products online should receive personalized recommendations in-store based on their online behavior.This seamless integration enhances the customer experience and drives higher engagement and sales.Integrating technology and data is essential for creating a seamless omnichannel experience.Organizations must invest in technologies that enable real-time data integration and analysis across various channels.For example,implementing a customer data platform(CDP)allows businesses to consolidate data from different sources and create a unified view of the customer.This integrated approach ensures that customer interactions are consistent and personalized,regardless of the channel.Publicis SapientMedia Network Playbook|15Navigating the media network revolution requires a fundamental shift in mindset across four core areas:organizational change management,customer centricity,data management and channel optimization.By embracing these shifts,organizations can unlock the full potential of media networks,driving significant value for themselves,their customers and advertisers alike.As the landscape continues to evolve,staying ahead of the curve will be essential for sustained success.Publicis Sapient stands ready to partner with organizations on this transformative journey,offering the expertise,technology and strategic insights needed to navigate the complexities of media networks and achieve long-term success.Publicis SapientMedia Network Playbook|16CONTACT US:ABOUT PUBLICIS SAPIENTPublicis Sapient is a digital business transformation company.We partner with global organizations to help them create and sustain competitive advantage in a world that is increasingly digital.We operate through our expert SPEED capabilitiesStrategy and Consulting,Product,Experience,Engineering and Datawhich,combined with our culture of curiosity and deep industry knowledge,enable us to deliver meaningful impact to our clients businesses through reimagining the products and experiences their customers truly value.Our agile,data-driven approach equips our clients businesses for change,making digital the core of how they think and what they do.Publicis Sapient is the digital business transformation hub of Publicis Groupe with 20,000 people and over 50 offices worldwide.For more information,visit .Join the media network revolutionKyle BeckerDirector Business Development,Customer DCraig HooperDirector Business Development,Customer DXavier ArmannoManaging Director,Data MRay VelezChief Technology OFor more information,visit
2024-12-31
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1O C T O B E R 2 0 2 42IN THIS REPORT3C L I C K T O J U M P T O S E C T I O NFRANCHISESINTERNATIONAL.
2024-12-31
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Retail Media Goes to the Movies How the Convergence of Commerce Media&Video Will Transform Shopping April 2024 Jeffrey Bustos,Vice President,Measurement Addressability Data Center 1 Table of Contents 1.The Convergence of Commerce Media and Video-2 Developing an Effective Video Strategy-5 Understanding Challenges-7 Best Practices for Creating Engaging CTV Ad Experiences-9 Media Planning and Creative Strategy Best Practices-11 2.Measurement and Optimization-15 Measuring Success in CTV and Shoppable Video-17 Balancing measurement with objectives-18 Optimization Strategies for CTV and Shoppable Video-19 3.Data Partnerships and Monetization Opportunities-21 Unlocking the Potential of Data Partnerships with Data Clean Rooms-21 Understanding Ad Operation Requirements for Publishers-23 4.Embracing a Data-Driven Future-26 Key-Takeaways-28 Acknowledgement-29 Video Initiatives and Working Groups-31 Commerce Initiative and Working Groups-32 Upcoming Events-32 About IAB-33 Contact Information-34 2 1.The Convergence of Commerce Media and Video The convergence of retail media and video is revolutionizing the advertising landscape,creating partnerships that benefit retailers,CTV platforms,brands,and consumers.This integration reshapes advertiser reach and enhances ad personalization and effectiveness.CTV platforms provide large-scale engagement opportunities,holistic user experiences,robust consumer relationships,and high-fidelity data for improved match rates.By combining shopper data with creative technology and comprehensive measurement and targeting capabilities,marketers achieve greater relevancy and results,leading to a more impactful and enjoyable viewing experience for streamers.Currently,over 85%of households are CTV-enabled,showing a growing preference for Ad-Supported Video On-Demand(AVOD)and Free Ad-Supported Streaming TV(FAST)due to competitive pricing and content variety.This shift is moving consumers away from traditional Subscription Video on Demand(SVOD)and enabling retail media networks to leverage first-party data for precise audience targeting.With the impending deprecation of third-party cookies,CTVs first-party data capabilities have become essential for impactful advertisinga trend that the pandemic has accelerated,with ad-supported streaming audiences surpassing cable TV in 2022.Forecasts predict this growth will continue,with an expectation of 195 million AVOD viewers by 2027,far surpassing the projected 91 million pay TV viewers.Leveraging retail data on CTV has been an exciting unlock for many of our brands-creating opportunities to reach highly valuable audiences in the most premium ad format and being able to close the loop with sales measurement.says Nikki Neary,SVP,Horizon Media The opportunity is there not only for endemic brands,but non-endemics as well,as were finding leveraging these rich data sets to reach audience personas can be just as valuable,if not more,than targeting more granular in-market or competitive segments”Shoppable TV has been a topic of interest for over a decade,yet it hasnt achieved widespread adoption until recently.Historically,several barriers hindered its progress:1.Consumer Readiness:Initially,consumers were hesitant to embrace shoppable TV due to unfamiliarity and comfort with traditional shopping channels.The transition to purchasing directly through a television interface was a significant shift from established consumer habits.3 2.Technology Limitations:Earlier attempts at shoppable TV were plagued by technological constraints.These limitations included clunky interfaces,slow response times,and a lack of seamless integration between content and commerce,which led to a disjointed user experience.3.Lack of Data Integration:The early iterations of shoppable TV lacked the sophisticated data analytics and targeting capabilities we see today.Without these tools,it was challenging to deliver personalized and relevant shopping experiences to viewers.“However,the opportunity around shoppable TV is changing due to significant advancements in technology and shifts in consumer behavior.Modern smart TVs and streaming devices offer sophisticated,user-friendly interfaces that facilitate seamless interaction with content,including shoppable ads.”said David Cohen,CEO at IAB.“These advancements,combined with increased consumer comfort with digital transactionsaccelerated by the pandemic-induced surge in online shoppinghave set the stage for shoppable TVs growth.”The evolution of data analytics and targeting technologies has transformed shoppable TV into a personalized and engaging experience.Advertisers,leveraging robust first-party data and advanced analytics,can create targeted campaigns that resonate with viewers and drive sales.Retail Media has showcased the potential of first-party data as marketers seek alternatives to third-party cookies.Connected TV(CTV)exemplifies the success of first-party data,utilizing data clean rooms and collaboration technologies to unify brands,retailers,and media owners,enhancing experiences for their mutual customers.“Retail media is all about reaching customers wherever they spend their time,like CTV,and giving brands visibility into their impact on the shopping journey.When used as part of an omnichannel campaign,CTV can connect customers with brands as they move through the funnel from display,video,or search in a shopping app,to in-store placements,”said Ryan Mayward,SVP of Retail Media Sales for Walmart Connect.For example,Oikos,a Danone brand,worked with Walmart Connect to test the effectiveness of connected TV for a campaign aimed at inspiring customers to make smart snack choices that give them energy and strength.The campaign resulted in 32%of units sold to New Buyers,while sales lift increased by an additional 18%.This illustrates the importance of taking an omni-channel approach to effectively target the right audiences at the right time throughout the customer journey.Integrating CTV into retail media strategies offers advertisers an unparalleled opportunity to enhance brand visibility,engagement,and conversion rates across the consumer journey.To effectively leverage this integration,advertisers should consider:Enhanced Data Utilization:Retailers can leverage their customer data for more precise targeting on CTV platforms.Imagine a scenario where a viewers online shopping behavior influences the ads they see on their smart TV.Ethical Considerations and Consumer Privacy:As data becomes increasingly central to advertising strategies,addressing privacy concerns and ethical considerations in data collection and usage are critical.Seamless Omnichannel Experience:Brands can create cohesive campaigns that customers encounter both on their TVs at home and on their smartphones or computers when shopping online,reinforcing brand messaging,and driving conversions.4 Measurable Impact:The combination of retail media and CTV allows for more accurate tracking of the consumer journey,measuring the impact of CTV ads when viewers later make a purchase on a retailers digital platform.Innovative Ad Formats:CTV opens the door for interactive and innovative ad formats.Retailers can experiment with shoppable ads,where viewers can purchase products directly from their TV screen,further shortening the path to purchase.For example,a new razor brand wanted to find a more premium,higher attention alternative to social video to reach active Boots shoppers.The brand made an unmissable impact among Boots shoppers with its first-ever campaign on ITVX.Boots Media Group identified behavioral audiences and active female buyers aged 18-44 to reach with targeted ITVX ads across key show genres.The campaign resulted in a 18%conversion lift in their target audience and averaged 74%more than the control group.“Its great to see data used in new and exciting ways,but as more businesses start to leverage first-party,data privacy becomes a major concern,”said Devon DeBlasio,Global Vice President,Product Marketing at InfoSum.“Marketers need to retain full control and ownership over how their data is leveraged,by whom,for what purpose,and at what granularity.Once you expose or share customer PII there is no walking that back.Retail Media Networks that use clean room technology can safely collaborate with partners while retaining full control and privacy protection.This critical tech ensures data remains decentralized and obfuscated with minimal data movement when being used to generate insights and performance.”Marketers must remain flexible,adapting their strategies based on real-time data and emerging trends.This means having a fluid budget that can be redirected towards platforms and content types that are performing well.“TV streaming partnerships allow brands to drive results from reach and awareness to action and loyalty often with a single campaign,”says Lindsay Pullins,Director of Ad Revenue Strategy&Partnerships at Roku.“While still early days in CTV and Retail Media,brands like Red Baron are seeing a boost in household penetration of new and lapsed users through Retail Media partnerships that make it possible to match exposed viewers to in-store and online sales.”5 In another example,last November,NBCUniversal and Walmart united to enable Bravo fans to Shop the Moment on Peacock for the first time.The partnership allowed viewers to shop Walmart on Bravos Below Deck Mediterranean season 8 on Peacock.Powered by KERV,Must ShopTV used AI technology to identify objects within the scene of a show,enabling viewers to shop products featured in or inspired by the content theyre watching.So,after the chief stew served the sit-down dinner using dishware,viewers were served a shoppable ad unit where they could shop similar dishware on Walmarts site.Items were paired with Walmarts inventory,so viewers only saw options that were readily available to purchase.Developing an Effective Video Strategy By leveraging Retail Media data,brands can target their CTV campaigns more efficiently,focusing their investment on impactful impressions and avoiding those that dont yield results.The combination of first-party data and sales attribution tracking,unique to Retail,along with the impact of video content on large screens,creates a winning formula for advertisers and agencies to achieve their awareness and conversion goals at scale,said Jonatan Fasano,Head of Product at Walmart Connect Mexico.Given the exponential growth of CTV and Addressable TV audiences,and the omnichannel nature of retail,we are witnessing a new way to understand the impact of advertising on TV consumption.First-party data,based on a cookieless ID that is interoperable between retail media and various CTV players,will be crucial for a promising future where user identification and attribution measurement will become scarce capabilities.”6 Strategic Objective Alignment:Define brand-specific media objectives by analyzing the entire consumer journey,from awareness to conversion.Utilize lower funnel KPIs for brand awareness and affordability goals,and upper funnel KPIs for complex,high-value offerings.Prioritize a consumer-centric approach,understanding and adapting to evolving consumer preferences for personalized and seamless shopping experiences.Identify Shoppable Moments:Leverage technology to identify and create ideal shoppable moments within content,ensuring these are strategically placed and do not overwhelm the viewer.Balance the frequency and placement of shoppable elements to maintain viewer engagement without compromising the viewing experience.A holistic audience-first approach is really what enables CTV to stand out versus some other emerging Retail Media offerings.The ability to combine purchased-based audiences and interest-based audiences(i.e.:gaming and sports viewing)enables brands to find the coveted younger/gen Z audiences in new ways and truly show NTB(New to Brand)incrementality,said April Carlisle,EVP,Commerce,Spark Foundry.Product Relevance and Availability:Ensure continuous alignment of shoppable moments with real-time product availability,featuring items that are in stock and relevant to the viewers interests and current content context.This alignment enhances the user experience,making shopping via CTV more intuitive and efficient.Integrated Technological Solutions:Utilize advanced technologies,including AI-driven personalization and omnichannel activation platforms,to deliver interactive and engaging content.This approach should seamlessly blend commerce with content,providing a unified and dynamic consumer experience across all touchpoints.7 Adaptability and Balance in Creative Strategy:Maintain an agile media planning and creative strategy that can quickly respond to market changes and consumer behavior insights.Strive for a balanced approach in advertising that effectively builds brand awareness while driving conversions,tailoring strategies to the nuances of the target audience and product specifics.This leads to more targeted CTV buys,which can help decrease cost per unique household,increase campaign reach,and drive cost savings for brands.,said Benedict Wagstaff,Senior Director of Business Development at The Trade Desk.Weve seen that when CTV is leveraged alongside other channels it drives additional efficiencies for retailers and brands-decreasing time to convert up to 160%while requiring an average of 60%less impressions to drive conversion.For example,Paramount Australia recently launched a KERV-powered Pause to Shop Connected TV experience during Australian Survivor.This innovative feature allowed viewers to seamlessly watch,pause,browse,select,and shop for related products.When watching Survivor,viewers received an on-screen call-to-action prompting them to pause the show and explore Survivor merchandise available in the Paramount Shop.Early campaign results revealed an impressive 10.29%Product Level Scan-Rate,10 x higher than the industry benchmark.This strong performance demonstrates how the seamless integration of shoppable moments,combined with contextual relevance to the content,elevates the viewer experience and delivers increased engagement.Understanding Challenges The convergence of retail media and CTV does bring its own set of challenges and opportunities.For instance,it introduces complexities related to user interface design,cost efficiency,and strategic integration.As the landscape evolves,understanding these dynamics is crucial for brands to effectively navigate the challenges and harness the potential of CTV shoppable units,ensuring a seamless experience for consumers and a robust return on investment for advertisers.CTV shoppable units present unique user interface(UI)challenges,with a purchase journey that is less streamlined compared to mobile or web experiences.Users often experience friction when navigating from the CTV platform to complete transactions,highlighting the need for a more integrated shopping experience.Advances in API-based technologies are beginning to address these issues,offering solutions that integrate seamless payment processing,personalized recommendations,and real-time inventory updates directly within the CTV interface.While these innovations are promising,many are still in the early development stages 8 yet hold the potential to significantly enhance user convenience and engagement on CTV platforms.Marketers should also acknowledge that the cost of CTV advertising,at least for now,may not be as efficient as linear TV ads,according to Kelly Metz,Chief Investment Officer at OMD,“You had this incredible brand-building medium at the right price in television that was built up over decades,and now youre moving to a fully addressable medium with extreme scarcity.Until that scale increases and those price points drop,youre still going to have a challenge there.”From a traditional standpoint,achieving cost-effective reach at a competitive scale presents challenges,particularly when leveraging CTV alone.This is primarily due to the higher CPM rates associated with CTVs premium content and targeted advertising capabilities.However,an emerging opportunity for FMCG brands lies in evolving beyond traditional demographic-based targeting towards a more nuanced understanding of consumer lifetime value.“By transitioning from a CPM-centric approach to value-based bidding at scale,brands can more effectively allocate their advertising spend,ensuring that investments are directed towards engagements that offer the highest return on investment,”said Lawrence Taylor,President&Wonder of Retail 4 Brands.“This strategic pivot can unlock significant growth opportunities for brands,in particular FMCG,allowing them to leverage the full potential of CTV advertising by aligning spend with consumer value rather than mere impressions.”Despite the initial investment required for accessing and analyzing consumer data,the benefits of precise targeting and personalized messaging justify the costs.Employing metrics like view-through rates and engagement metrics is crucial for assessing the creative contents impact,ensuring that campaigns are not only compelling but also effective in driving results.However,when measuring the impact of CTV and Retail Media,it is imperative we tie engagement to incremental business outcomes such as site traffic and sales lift to close the loop beyond engagement on the TV screen and understand the impact of online and in-store activity.Brands should evaluate the long-term benefits of precise targeting against the initial expenditures,considering not just the campaign costs but the overarching value of first-party data for targeting,personalization,and closed-loop measurement.Historically,FMCG behemoths like P&G and LOral have dominated TV advertising,driven by the need for broad consumer reach to meet retail and production demands.The challenge of extending this reach on CTV is exacerbated by demographic limitations and suboptimal match rates,making it difficult to broaden audience engagement effectively.“Brands now recognize that the polarized and fragmented US consumer landscape requires a diverse mix of platforms,audiences,and messages tailored to those audiences,”observed Bryan Gildenberg,CEO of Confluencer Commerce.“And despite the buying limitations today,brands and retailers both realize the power of connecting watch data to buying data for targeting and closed-loop measurement is powerful-and that the hours of attention and consumed by CTV will continue to expand exponentially.”Another critical factor is maintaining brand tone and image consistency across all channels.By developing comprehensive brand guidelines that cover tone,visual style,and messaging,brands can ensure that their content remains consistent,regardless of the platform.This uniformity reinforces brand identity and aids in building a coherent and recognizable brand image across diverse media landscapes.9 Best Practices for Creating Engaging CTV Ad Experiences The growing prevalence of streaming and ad-supported environments is enhancing the opportunity to engage consumers with shoppable ads on CTV by prioritizing the integration of user interface(UI)design and payment processes.The transition from viewing to purchasing must be as seamless as possible to minimize friction and enhance user experience.For example,Disneys Gateway Shop is a sophisticated shoppable ad format that elevates the interactive ad experience by accelerating commerce within streaming.This new approach,appearing in mid-roll ad breaks,seamlessly integrates a 15-or 30-second video spot with an interactive layer,providing viewers with a rich array of product information.It features a product carousel showcasing items and their prices displayed alongside the ad.Users have the convenience of sending checkout details directly to their phone or email or using a QR code to access the shopping site immediately.This innovation underscores streamings shift towards ads that not only inform but actively drive sales,offering brands a tangible business outcome beyond traditional TV advertising metrics,and greater performance.“Creating shoppable ad content requires a blend of storytelling and ease of purchase,ensuring consumers are being engaged more directly and effectively,”said Jeffrey Bustos,VP,Measurement,Addressability,Data Center at IAB.“By harnessing detailed consumer data,employing interactive ad features,and maintaining a focus on brand consistency,brands can navigate the complexities of CTV to achieve their commerce objectives.”For example,a personal care brand activated with Rokus partnership with Instacart to measure and analyze the impact of their campaign on the online shopping behavior of converted buyers and the composition of their baskets using Instacart.60%of the converted buyers were new to a Personal Care Brand on Instacart and converted buyers spent 1.5x more on the brand than the average buyer on Instacart.Additionally,converted new buyers were 70%more likely to repeat purchase than all new buyers of the brands product.In contrast to the broader aims of traditional TV advertising,which often focuses on brand recall,shoppable video,and retail media,CTV ads demand a more interactive and immediate 10 consumer engagement.This pivotal change in consumer interaction necessitates a nuanced approach where brands analyze consumer behavior to tailor their messaging.The aim is not only to narrate a compelling story,but also to seamlessly incorporate prompts for immediate action,enhancing the ads relevance and effectiveness.According to a 2023 survey from The Trade Desk Intelligence,91%of U.S.advertisers intend to maintain or increase their investment in retail data over the coming years.Furthermore,68%of those who dont use retail data today plan to use it going forward.To achieve this,integrating storytelling with clear,actionable elements is essential.Features like embedded product links or QR codes within video ads can significantly enhance interactivity.Employing dynamic ads that adjust based on viewer data further personalizes the experience,thereby elevating the likelihood of conversion.For instance,Best Buy Ads leverages QR codes and unique creative formats that allow for more shoppability and interaction with consumers,while leveraging their first party data for targeting and closed-loop measurement.“The digital advertising industry continues to evolve alongside the newest technology,and that includes smart TVs.Advertisers are seeking out ways to reach consumers throughout the shopper journey on their way to checkout,and one of the biggest upsides of retail media is its ability to connect ad exposure to sales,said Brian Gleason,Chief Revenue Officer at Criteo.If advertisers want to leverage CTV for this,they will need to find a way to engage with consumers directly through ad content,whether through QR codes,like weve seen Coinbase execute,or sweepstake CTAs,as seen with Doordashs recent Super Bowl campaign,or other means.We can expect this will continue to evolve as more and more advertisers want to target consumers on the shopping journey in the same way retail media is capable of.”11 Media Planning and Creative Strategy Best Practices Developing a full-funnel retail media strategy is essential for effectively capturing consumer demand.This approach necessitates the integration of CTV into a comprehensive retail media plan that addresses every stage of the consumer journeyfrom initial awareness through to consideration and conversion.By leveraging detailed retail data,brands can craft targeted messaging that resonates with consumers at each stage,ensuring that CTV campaigns are not only relevant but also highly impactful.This strategic integration across the funnel allows brands to fully harness the potential of CTV within the retail media ecosystem,driving both engagement and sales.Navigating the intersection of Retail Media and Connected TV demands a delicate balance between targeting precision and broad reach,”said Amber Roberts,Partnership Director at Threefold.“As the landscape evolves,the challenge lies in leveraging first-party data effectively to align with both retailer initiatives and advertiser objectives.Crafting tailored strategies that embrace the needs of both not only enhances customer experience but also fosters long-term sales growth,driving consideration and loyalty in the ecosystem.Product and Location Feeds:Ads should promote timely and relevant products,including location information to emphasize availability.Sequencing and Dayparting:Strategically sequence ads to guide consumers through the funnel and use dayparting to align ad displays with viewer habits for maximum relevance.Targeting Strategies:Distinguishing between active shoppers and those inspired to buy can help tailor content more effectively.Creating connected ad series or utilizing dynamic retargeting strategies can address low ad inventory issues and keep the consumer engaged across their buying journey.12 Competitive Analysis and Retargeting:Comparing strategies with competitors and focusing on retargeting efforts are essential for capturing and maintaining consumer interest.This involves offering multiple opportunities for engagement and leveraging internal support to maximize the impact of the video strategy.Leveraging Technology and Partnerships:Utilize QR codes and form strategic partnerships with CTV platforms and retailers to boost brand reach and effectiveness.These should be clearly visible and remain on screen long enough for viewers to engage,facilitating a smooth transition from viewing to shopping.Design ads that dynamically display the nearest store locations to encourage foot traffic,supported by foot traffic studies to assess impact.Use engaging visuals,sounds,and movement to highlight key products.Feature prominent QR codes with clear calls to action,like scan to learn more or add to cart,tracking engagement through QR scans and cart additions.When incorporating QR codes,including a countdown progress bar can help set expectations with viewers on how much time theyll have to scan placing prominently on a dedicated end card can improve engagement.Combine dynamic location data with add-to-cart QR codes to promote in-store and online products effectively.Ensure these elements support,rather than distract from,the core brand message.For example,Roundels shoppable CTV ads incorporate visually engaging creatives,prominent Target branding,and QR codes with calls to action like Add to your pick-up order or Scan to add to cart.This approach meets consumer shopping patterns and attracts consumers to purchase in ways that are better served to specific product categories,such as perishable or non-shippable grocery items that are limited to in-store and order pickup purchases.The branding leverages the association with a trusted retailer,such as Target,to deepen viewer engagement.A survey of Target guests indicated a preference for ads coming from Target,suggesting a higher level of trust in these advertisements.In a collaborative campaign with Mead Johnson,featuring their Enfamil baby formula product,Roundel utilized shoppable CTV ad formats to connect with relevant customers.By tapping into Targets first-party data,the campaign focused on audiences with a history of baby product purchases at Target.The initiative aimed to enhance product awareness and purchase.Specifically,double-digit ROAS was observed for this campaign,reflecting great success with getting guests to engage with the ad and move down the funnel.“To capitalize on the streaming experience of the user,Retail Media holders can expand creative capabilities by integrating existing APIs that drive commerce on their other digital platforms into CTV ad formats.This allows users to Add to Cart/Add to Pickup Order and informs the very next impression with creative performance data,custom performance bidders,and more seamless experiences.Beyond Innovative creative experiences,incrementality and advanced measurement capabilities could also be unlocked.”said Dan Mouradian,SVP,Global Client Solutions at Innovid.When activating CTV campaigns within retail media,two primary approaches emerge,programmatic platforms and managed services.Programmatic platforms allow for broad access to retail audience data and segmentation targeting,enhancing ad precision.On the other hand,managed services,dictated by specific retailers,provide targeted audience and inventory management but might restrict flexibility.13“The convergence of connected TV into retail media delivers a more dynamic,engaging,and measurable form of advertising that reflects broader trends in digital marketing.As consumer expectations continue to evolve,the ability of brands to innovate and adapt will be paramount.This convergence not only brings valuable stories closer to the consumer but also offers brands the insights needed to deliver compelling experiences that resonate deeply and drive loyalty.The future of retail media lies in its ability to blend creativity with technology,delivering messages that are not just seen but felt and remembered.Connected TV provides a compelling vehicle to deliver that message”said Cody Tusberg,SVP of Retail Media at Acosta Group While managed services offer beta opportunities and exclusive targeting capabilities,the agility and scale provided by programmatic platforms often render them the preferred choice.Brands can leverage retailer data more effectively through programmatic means,using the same segment to retarget in a demand-side platform to optimize campaign performance,access first-to-market opportunities and comprehensive insights that inform more strategic planning and measurement.In managed service collaborations,its imperative for brands to communicate specific needs and concerns regarding inventory selection,brand suitability,and targeting to ensure campaigns adhere to brand guidelines and objectives.As an example,PetSmart runs managed service shoppable video campaigns on YouTube for their manufacturers.These campaigns combine brand advertising with product feeds that send clickers back to PetS.The brand is seeing strong returns for their customers from these activations.Shoppable TV is no longer a concept-its the new reality.Living in a world with 24-7 digital availability,we can shop instantly,anywhere,and everywhere,”says Marika Roque,Chief Innovation Officer at KERV.Long-form content requires AI&automation to enable this at scale across the big screen,but that isnt enough.Adding that“TCommerce requires managing the process similar to taxonomy mapping and optimization utilizing scene data,talent mapping,moments,and product match management.The metadata AI can generate will help brands and publishers ensure that in-content shopping is highly relevant,personalized,and a frictionless experience for viewers.”14 For example,Sam Edelman partnered with KERV to generate awareness and increase purchase intent among women aged 25-54 across their favorite streaming services.KERVs AI automated the brands custom QR code development&managed a dynamic 2nd screen companion unit product feed to ensure items shown were always in stock.The customized QR end frames earned the brand an additional 63rned time spent with customers,and the combination of an immersive CTV video experience with a 2nd-screen shoppable moment effectively collapsed the funnel.In a brand lift study done in partnership with Lucid/Cint,the dynamic aspects of the campaign effectively increased brand awareness by 7.10%and increased purchase intent by 6.4%.“As CTV capabilities evolve,itll be crucial for national and commerce media teams to work closely together to ensure the plans are complementary to each other vs being planned in silos,”said Rose Tagas,SVP Commerce,at UM Commerce.“The lines between national and commerce continue to blur and are being accelerated as RMN offerings evolve.We need to start thinking differently about how and when to tap into a channel,whose budget(national vs commerce)and how we evaluate success.Is it by national KPIs such as imps and CTR,by sales KPIs like ROAS or ROI,or a combination.”A creative consideration is that many advertisers prefer using existing video creatives for shoppable CTV.Overlay formats where a QR code and light branding is placed on top of the video asset can crop out key messages that brands want to drive forward,so this should be a consideration for advertisers when choosing formats and partners.As an example,Roundel decided to offer canvas ad units with advertisers that scale down the video to accommodate a larger QR code and prominent branding surrounding the video.This allows the branding to capture attention and stand out among an ad pod where consumers can easily miss messages.15 2.Measurement and Optimization The integration of retail media and CTV excels in closed-loop measurement,tracking the consumers journey from ad exposure to final purchase and providing deep insights into advertising impact.“Understanding the relative effectiveness of brand and performance media is one of the most pressing challenges for brands,and theres no one methodology to solve the problem,”said Steve Baxter,EVP of Retail Media at Ovative Group.“The key is to comprehensively connect data and metrics across the funnel,align on an approach and assumptions to assess incrementality,and establish a plan to continuously test and learn over time while also informing ongoing budgeting decisions.Brands need access to data from media platforms,their web sites,their apps,and the customer databases in one place,leveraged across brand-focused MMMs and lower-funnel tracking MTA in a way that suits their business.”Retail media and Connected TV(CTV)is poised for significant evolution,impacting how we approach advertising strategies:1.Data-Driven Optimization:As Supply Path Optimization(SPO)has revolutionized display campaigns,a similar trend will be needed for developing algorithms that optimize the sales path.These algorithms will focus on finding the most effective retailer and CTV combinations,driving sales,attracting new buyers,and fostering repeat purchases.2.Continuous A/B Testing for Benchmarking:ROAS benchmarks will be needed to plan Retail Media and CTV campaigns effectively.Regular A/B testing is crucial for setting benchmarks in messaging and visuals.This helps in formulating ads that not only boost market share but also support the successful launch of new products.16 3.Custom Audiences with Precise Parameters:While generic audiences provide a starting point,leveraging data science to define precise parameters for custom audiences is essential.For example,in applying the RFM(Recency,Frequency,Monetary)model,we must identify the optimal values for each parameter tailored to specific brands or categories.4.Agile Response to Outcomes:Monitoring real-time metrics is more crucial than ever.Adapting strategies promptly in response to market shifts and consumer feedbacksupported by accurate media mix modelswill enhance the effectiveness of ongoing campaigns.“Another key point is the ability to measure the increase in sales on an omnichannel level.Since we can identify the customer,we can track their interests and purchases both in physical and digital stores after interacting with an ad.This approach provides a more comprehensive view of the consumer journey and allows for a greater understanding of the level of impact achieved by the campaign,”commented Eduardo Gauna,Head of Cencosud Media in LATAM.Utilizing this data for continuous optimization rather than just reporting is where the real advantage lies.It allows for the adjustment of creative strategies and media spending based on real-time feedback on what drives conversions.It paves the way for more sophisticated attribution models,going beyond simple metrics to a more nuanced understanding of advertising impact.A significant challenge in creating content for CTV and social media lies in the balance between creativity and measurable outcomes.Employing metrics such as view-through rates,engagement rates,and conversion rates is vital for assessing the impact of creative content.This data-driven approach ensures that creative efforts are not just visually appealing or narratively compelling but also effective in driving tangible business results.“For advertisers today,delivering reach isnt enough.Advertisers demand measurable outcomes,from awareness to conversion.Success is now defined by full-funnel performance,customized to each advertisers objectives.”said Nikhil Raj,Chief Business Officer,Retail Media at Moloco.“CTV inventory enables retailers to target consumers at the top of the funnel leveraging their first-party data to improve targeting,enable measurement and drive meaningful results for advertisers.17 Measuring Success in CTV and Shoppable Video The measurement of CTV and shoppable video campaigns,particularly those leveraging retail media data,requires a nuanced approach.Traditional metrics like view-through rates and engagement metrics remain relevant but are complemented by more sophisticated measurement techniques that assess direct consumer actions and purchasing behavior.Closed-Loop Attribution:This method is paramount in understanding the direct impact of CTV ads on consumer purchases,especially for shoppable content.Closed-loop attribution tracks the viewers journey from ad exposure to product purchase,offering clear insights into the effectiveness of the ad.Incremental Sales Lift:By comparing sales data from exposed and non-exposed audience segments,advertisers can quantify the incremental impact of their CTV and shoppable video campaigns on sales,providing a direct link between ad exposure and purchasing behavior.Engagement Metrics for Shoppable Content:For shoppable video,engagement metrics extend beyond views and clicks to include interactions with the shoppable elements of the ad,such as product clicks,add-to-cart rates,and direct purchases through the video interface.New retail metrics:Retail media networks are now providing more metrics to quantify the success of campaigns beyond sales.These can include incremental reach,audience composition,brand lift,offline attribution,engagement,and conversion metrics.Incremental reach measures the additional audience CTV ads reach.Audience composition analyzes the demographic and behavioral profiles of the audience reached vs the targeted audiences),Brand lift assesses the impact of CTV advertising on brand awareness,perception,consideration,and intent metrics.Attribution correlates ad exposure with outcomes such as detail page visits,increased search queries and impact on retail sales-in the most advanced model,attribution will measure online AND offline sales.18 An example includes new purchaser percentages attributed to the CTV ads.For example,Roundel partnered with Danone to drive awareness of a low-sugar smoothie product.36%of Target purchasers attributed to the campaign were new to Danone,allowing the brand to quantify success in driving awareness with new purchasers.“Particularly in CTV where,unless the media platform enables a shoppable SDK for ad engagement,most metrics of interest will occur offline or on a secondary device within the household viewing the CTV ad.”said Charel MacIntosh,Head of Business Development&Strategic Partnerships at Clinch.Insights derived from user actions within a household attributed to an RMNs ad unit carry significant learnings to RMNs that span the behavioral spectrum and are much richer than the standard Video Completion Rate.Adding that“Retail media networks can understand the patterns of conversion by product category,location,various calls-to-action,and more.These insights can also inform the creative strategy utilized by the RMN for lower funnel ads whether it is display or online video.This is also where leaning into sequential messaging can be extremely impactful for a great customer experience and for driving conversions.”Balancing measurement with objectives While theres an initial investment required for accessing and analyzing consumer data,the long-term benefits significantly outweigh the costs.Precise targeting and personalized messaging,made possible through this data,are pivotal in crafting messages that resonate with the audience.Employing metrics like view-through rates and engagement metrics is essential for gauging the creative contents impact.These metrics help ensure that campaigns are not just compelling but also effective in driving tangible results.However,focusing solely on engagement metrics provides an incomplete picture of a campaigns success.The larger piece of the puzzle lies in tying engagement metrics to incremental business outcomes,such as site traffic and sales lift.This approach closes the loop beyond mere engagement on the TV screen,offering a comprehensive understanding of a campaigns impact on both online and in-store activity.Its imperative to measure how CTV and retail media engagements translate into actual consumer actions,enabling advertisers to assess the effectiveness of their campaigns in driving real business growth.By integrating these considerations into the strategic planning and execution of CTV and retail media campaigns,advertisers can not only capture attention and engage viewers but also drive measurable outcomes that contribute to their bottom line.For example,a premium pet food brand was launching their brands first grain-inclusive line and needed to quickly drive awareness to reach active Amazon shoppers with limited budgets.The brand used an add-to-cart streaming TV ad to target prospective audiences and scale lapsed purchasers.Throughout the flight,onsite search saw an uplift and new audience pool growing from those exposed to the Streaming TV ad were optimized within onsite display.The brand saw a 49%portfolio sales lift from new customers,and higher than average search volume for months after the execution.Balancing brand building with direct conversions is a delicate art.While shoppable videos offer direct paths to purchase,they should also convey the brands story and values.Creative content 19 that tells a compelling story,coupled with subtle product placements,can enhance brand recall and loyalty while driving sales.Optimization Strategies for CTV and Shoppable Video To ensure that your CTV and shoppable video campaigns are aligned with your audience strategy,its crucial to go beyond traditional sales metrics when defining your key performance indicators(KPIs).While sales data can provide valuable insights,it might not fully represent the success of these specific types of campaigns.Instead,consider integrating lower-funnel display,retargeting,and search tactics to re-engage users,thereby enhancing their consideration and increasing the likelihood of conversion.Executing CTV and online video(OLV)campaigns programmatically offers a strategic advantage,especially when leveraging first-party(1P)data from retailers like Walmart,Kroger,and Target.This approach not only ensures more efficient rates but also allows for rapid optimizations across various data sets,maximizing campaign performance.Dynamic Creative Optimization(DCO):Utilizing DCO allows for real-time adjustments to ad creative based on viewer behavior and preferences,enhancing personalization and relevance of shoppable video ads.A/B Testing and Multivariate Testing:Employing these testing methods helps identify the most effective ad elements,from messaging and creative to shoppable features,informing future campaign optimizations.Platform and Format Diversification:Experimenting with different CTV platforms and shoppable video formats can help identify the most effective channels for reaching targets.Product Feed Optimization:Integrating product feed optimization into the campaign strategy helps ensure that the right products are highlighted in a manner that is attractive and relevant to the target audience.The measurement strategy for a campaign should be tailored to its objectives,which often depends on the source of the media budget.For traditional CTV or video budgets,having access to sales data marks a significant advancement in quantifying campaign performance.This new access helps demonstrate the tangible impact of media on business outcomesa capability previously missing in these channels.However,its important to recognize that sales-based metrics,such as sales,return on ad spend(ROAS),and new-to-brand sales,may not fully capture the effectiveness of CTV or video when compared to other digital tactics.Where feasible,measuring the success of retail media CTV campaigns through brand lift or household penetration lift studies offers a more nuanced understanding of their impact,rather than relying solely on direct sales metrics.“The convergence of commerce media and CTV brings together a perfect opportunity for retailers,who have historically tapped into shopper media budgets,to expand out into new,incremental revenue streams from national and brand budgets.”said Hash Mian,VP,Commerce Media at PubMatic.“Brands gain performance benefits from the ability to apply purchase-based data signals;plus,more real-time,sales-oriented measurement is a massive upgrade from the traditional demographic and reach/frequency model.It is the perfect pairing of first-party data,engaging formats,and true closed-loop measurement.20 To further enhance insights into sales,household penetration,or brand lift metrics,its advisable to secure adequate campaign budgets.This financial planning enables the negotiation of added-value measurement studies with partners.Collaborating with entities like Kroger(via Roku or directly)allows for the expansion of measurement studies beyond the standard attributable metrics and to align the measured metrics with the campaign goals and KPIs,moving into incremental views or diving in deeper with additional breakouts by creative.Additionally,working with Amazon allows for the inclusion of third-party(3P)measurement tools from companies like Circana or Kantar,supplementing the first-party data received directly from retailers.For example,after launching a new plant-based yogurt product,Danones objective was to increase awareness,generate trial at scale,and drive sales velocity.Danones agency,Wavemaker,combined KPM custom audiences with Roku TV streaming to achieve results.Using precise 1:1 measurement and in-campaign optimization,the campaign drove unparalleled,measurable reach in the US to increase trial and household penetration.The campaign saw high double-digits lapse brand buyer category dollars toward the brand and gained share.Additionally,the campaign saw incremental sales lift and an increase in household penetration.“Were creating trusted media bridges places where brands can apply and scale our audiences especially in streaming TV.No single publisher can meet every consumer need alone,”said Cara Pratt,SVP of Kroger Precision Marketing.“But with a streamlined approach to CTV activation,retailers can deliver better experiences for consumers and better outcomes for brands.”When planning your targeting strategy to meet campaign KPIs,consider implementing category targeting.This allows advertisers to refine their focus based on category,keyword,or audience,capturing complementary purchases,and facilitating more precise targeting.Its also important to ensure that your partners can provide the necessary campaign levers and optimization methods to meet your needs,thereby improving visibility,engagement,and attribution,and ultimately driving campaign success,audiences and driving conversions.As CTV and retail media continue to evolve,so will the strategies for measuring and optimizing these campaigns.Advertisers will need to stay agile,embracing new technologies and methodologies to remain competitive in this dynamic environment.21 3.Data Partnerships and Monetization Opportunities Unlocking the Potential of Data Partnerships with Data Clean Rooms As signal loss increases and shopper behavior evolves,media networks must offer advertisers flexible and personalized segmentation,aligning these audiences with media consumption throughout the funnel.“Retail media networks are uniquely positioned to target consumers across media channels and leverage their owned differentiated assets to influence conversion.Combining these inherent advantages with the premium formats and vast addressable audiences on CTV paves the way for each sector to scale and enhance performance more than ever before,”said Lori Johnsoy,Head of Global Retail&CPG Industry Strategy at LiveRamp.“Data is the foundation for making this possible,which is why well see an increase in data collaboration tools such as data clean rooms across the RMN and CTV sectors.The surge in video content across social media and CTV platforms has unlocked fresh opportunities for brands to impact in-store conversions as video assets used in CTV can become more readily available for in-store screens.”The core foundation of RMN lies in data,a vital component needed in CTV to form this powerful combination.Their integration also offers a chance to introduce the much-needed transparency and quantifiable effectiveness to advertisers.By unlocking siloed and previously inaccessible exposure data across media partners,all while maintaining a privacy-centric approach,RMNs can gain a more comprehensive understanding and capitalize on opportunities within CTV,which is currently the fastest growing ad format in the US.This allows them to enhance their omnichannel measurement capabilities and develop a complete 360-degree view of their customers.The use of data clean rooms in Retail Media Network(RMN)and Connected TV(CTV)partnerships facilitates a deeper,more nuanced understanding of consumer behaviors and preferences.Retailers can utilize their rich first-party data,encompassing purchase history and 22 customer demographics,in a way that adheres to privacy regulations.This integration,when paired with the wide reach and immersive experience offered by CTV advertising,markedly enhances campaign relevance and engagement.Data clean rooms allow for the processing and analysis of sensitive data while ensuring consumer privacy using differential privacy and privacy controls.Differential privacy ensures that the data analyzed cannot be used to identify any individual,thereby preserving the privacy of consumer information.This method allows for the safe analysis of data,enabling insights into consumer behavior without compromising individual privacy.Additionally,nuanced consumer insights can be achieved through APIs or data onboarders,which facilitate secure data transfer and integration between platforms,enabling sophisticated targeting and personalization without building data clean rooms from scratch.Whether through direct integration via APIs,the use of data onboarders to match and segment data,or employing data clean rooms with differential privacy,retailers and CTV platforms can leverage detailed consumer data in a privacy-compliant manner to drive significant improvements in campaign performance.For example,a partnership between a media owner,Channel 4,and a data provider,Nectar360,showcased a significant sales uplift for CPG brands.Utilizing Nectar360s loyalty grocer data,multiple CPG partners were able to target high-value retail audiences on Channel 4s platforms,overcoming the challenge of limited direct access to first-party consumer data.Through the strategic and secure use of second-party data and the InfoSum data clean room for targeting and measurement,the campaign achieved a maximum sales uplift of 122%during its test phase,highlighting the effectiveness of leveraging tailored shopper segments and creative strategies in CTV advertising.The strategic planning phase involves data providers crafting precise audience segments based on consumer purchase behavior,tailored to align with specific brand objectives.This approach leverages the strengths of retail media networks and CTV to enhance campaign targeting and efficiency.CTV planning and strategy can start in clean rooms even before audiences are created.Leveraging a mix of 1P and 3P data sets via clean rooms,brands have instant access to ad hoc customer insights based on real-world purchase habits rather than panel-based surveys that are executed over months.“Answering questions about customers has never been quicker;who is buying across categories or specific products?How often are they repurchasing?Who is lapsing and when?Trends over time or between retailers all these questions contextualize the customer journey and should be used to inform high-level media mix and low-level tactics,”said Derek Nelson,Sr.Director of Retail Media Consulting at Ovative Group.For activation,these carefully curated audience segments are then integrated into a platform that facilitates matching these identified shoppers with CTV viewers on a one-to-one basis,ensuring highly personalized advertising experiences.An optional matching phase allows for the enrichment of these audience segments by integrating a brands first-party data with those of data and media owners,fine-tuning the targeting accuracy and optimizing campaign outcomes through enhanced match rates and segmentation.For example,imagine a scenario where a sports apparel brand leverages a data clean room to merge insights from a CTV platform with shopping data from a retail media network.They identify an audience segment of fitness enthusiasts who have recently searched for running shoes but havent made a purchase.The brand then directs its CTV ads specifically to this group,leading to a campaign that not only resonates on a personal level but also significantly 23 lifts sales.This exemplifies the essence of strategic planning in todays digital age:“By harmonizing data with brand objectives within the secure confines of a clean room,we unlock a new dimension of campaign precision and efficiency,setting a gold standard for digital advertising,”said Amanda Vice,Senior Director of Data and Tech Consulting at OMD USA Understanding Ad Operation Requirements for Publishers In the fragmented landscape of Connected TV(CTV),advertisers face the challenge of delivering consistent messaging at scale to effectively reach their target audiences.Supply-Side Platforms(SSPs)play a pivotal role in this ecosystem,acting as conductors that orchestrate data and inventory,enabling a unified approach to advertising.By centralizing the advertising process,SSPs empower retailers to tailor messages precisely and reach audiences with interactive formats such as product scrollers,dynamic deals,and interactive ad units,unlocking the true potential of the CTV environment.Just as brand and retailer organizations are undergoing change management to address the challenges and opportunities of full funnel retail media,the reality is as much if not more change is happening in the technology and data operations to enable marketers to usher in this era of full funnel,programmatic retail media.The convergence of live market signals,disparate retailer performance metrics-both ads and sales-and the adoption of AI-based media platforms and privacy safe measurement paradigms makes this a reality.This expands on a decades-in-the-making RTB paradigm from the history of Display and Video programmatic:inventory and sales signals,live competitor insights across retailers,and now the connection to each retailers node as a media property and lessor of 1P data for full funnel activation gives the marketer the raw material and technology needed to execute a product specific algorithm per retailer,cross-retailer,reacting to live market insights programmatically adjusting budgets,bids and new campaigns,and measuring across the entire funnel.However,aligning advertisers creative aspirations with media owners operational realities presents notable challenges.Technical inconsistencies and siloed infrastructures necessitate ongoing innovation and collaboration to ensure seamless integration across the CTV ecosystem.SSPs are instrumental in overcoming these obstacles,facilitating the integration of innovative ad formats like quizzes and carousels,despite varying capabilities across media owners.24 For interactive ad units that allow viewer engagement through remote controls,bespoke SDK integration for each platform and device is required.This scenario underscores the complexity within the CTV landscape,where marketers aiming for consistent messaging might need to navigate direct deals with multiple publishers,each with unique integrations and capabilities.SSPs simplify this process,offering marketers a single access point to execute diverse types of CTV ad buys,including Programmatic Guaranteed and Private Marketplace deals,making interactive units scalable and manageable.When planning for a TCommerce(Television Commerce)partnership,the following factors should be considered to ensure the best“shoppable”consumer experience.Before recent AI/ML advancements,the idea of shop the show or shop the moment or“shop the ad”was just that-an idea.Now,with the right automation technology in place,it can be live in a matter of hours.“The key to activating interactive programmatic CTV inventory lies in unifying the buying process through a single access point,regardless of the execution type(PG or PMP),”said Gretchen Bobroff,Head of Retail Media at Magnite.“This streamlines the negotiation process for marketers,especially when dealing with the fragmented CTV landscape and diverse publisher SDK integrations.Implementing a CTV retail media strategy involves a technical framework that integrates various components,including data management,platform selection,content delivery,and performance analytics.”Data Integration and Management Data Sources:Aggregate first-party data from retail media(CRM,POS,e-commerce platforms)and third-party data(if applicable)for audience insights.Data Management Platform(DMP):Use a DMP or Customer Data Platform(CDP)to centralize,manage,and segment audience data.Ensure privacy compliance and data security.Audience Segmentation and Targeting Segmentation:Use advanced analytics and machine learning algorithms on the DMP/CDP to create detailed audience segments based on shopping behavior,preferences,and demographics.Targeting:Integrate the DMP/CDP with Demand-Side Platforms(DSPs)to automate the targeting process on CTV platforms.Media Planning and Programmatic Buying CTV Platforms Selection:Identify and evaluate CTV platforms(like Roku,Hulu,Peacock,Max,etc.)based on audience demographics,content alignment,and reach.Programmatic Buying:Utilize a DSP for real-time bidding and programmatic ad placements on CTV platforms.Leverage algorithms for dynamic media buying are based on audience behavior and campaign performance data.Content Creation and Optimization Creative Development:Develop engaging and high-quality video content tailored to the CTV environment and audience segments.Consider interactive elements or shoppable features if supported by the platform.Ad Serving and Optimization:Use an Ad Server integrated with your DSP for delivering and managing CTV ads.Employ A/B testing and multivariate testing for creative optimization based on viewer engagement and conversion metrics.25 Measurement and Analytics Closed-Loop Attribution:Implement closed-loop attribution models to track the customer journey from ad exposure on CTV to conversion actions on the retail platform.Performance Analytics:Use analytics tools to monitor key performance indicators(KPIs)like view-through rate,conversion rate,and return on ad spend(ROAS).Integrate CTV platform analytics with your own analytics system for a holistic view.Continuous Optimization Feedback Loop:Establish a feedback loop where performance data informs ongoing campaign optimization.Use machine learning for predictive analytics and to refine audience targeting,bidding strategies,and content delivery.Agility in Strategy:Stay agile with your strategy,ready to adapt to changes in viewer behavior,platform algorithms,or market trends.To streamline ad operations from the perspective of retailers and CTV publishers,its essential to integrate APIs for a seamless shoppable experience,enabling features like Add to Cart,real-time inventory updates,and dynamic pricing.This approach not only facilitates frictionless shopping but also allows retailers to optimize inventory distribution based on demand insights.For retailers and publishers,the initial focus should be on reaching audiences effectively,then measuring outcomes to prove the value of these new connections.Interactive CTV ad formats are crucial for engaging viewers,offering detailed product information and a non-intrusive path to purchase,enhancing the overall consumer experience.Embracing shopper marketing digitally,retailers can use dynamic creative technologies to customize the shopping journey,significantly driving purchases.Implementing a robust technical framework that includes data management,audience segmentation,programmatic buying,and content optimization is vital.Continuous performance analysis and strategic agility ensure campaigns remain effective and responsive to market trends and consumer behaviors.26 4.Embracing a Data-Driven Future The intersection of retail media and CTV marks a new era in advertising,where data is the cornerstone of successful strategies.Its about crafting a consumer journey that is not just seamless but also engaging,making the most of the strengths that each platform offers.Enabling the opportunity to boost brand visibility,engagement,and conversion rates.Advertisers can leverage customer data for targeted campaigns,where a viewers online behavior influences the ads they encounter on their smart TV,creating a seamless omnichannel experience.This approach not only reinforces brand messaging but also facilitates a more accurate measurement of the consumer journey,from ad exposure to purchase.Based on a Samsung Ads and KERV study,70%of smartTV viewers shop on other devices while watching TV,with 51%of viewers interacting with QR codes for product information and 26%for purchases,the demand for shoppable ads is evident.The surge in TV-driven digital commerce,particularly in sectors such as clothing,electronics,and food,underscores the escalating influence of streaming platforms.These platforms,where a vast majority of viewers spend their TV time,are becoming the vanguards of shoppable content,setting the stage for an advertising renaissance that prioritizes immersive and interactive experiences.“The Retail Media era is just getting started,says Louqman Parampath,VP Ad Product Management at Roku.“Overall,well continue to see more integrations with Retail Media Networks and CTV platforms,especially as advertisers look to incorporate seamless shoppable experiences that only CTV platforms can provide with the targeting and measurement capabilities of retail media.”Looking ahead,the synergy between retail media and CTV is poised to spawn groundbreaking innovations.We might anticipate the development of AI-driven ad platforms that predict and adapt to consumer preferences in real-time,offering personalized ad experiences that resonate with the viewers current mood and interests.Imagine a scenario where CTV ads use augmented reality(AR)to allow viewers to virtually try on clothes or visualize furniture in their 27 living space directly from their living room,transforming passive viewing into an interactive shopping spree.Generative AI and machine learning are crucial in this integration;harnessing the vast streams of data to streamline the user interface,enhance cost efficiency,and fortify strategic integration between retail media and CTV.These technologies can automate and refine ad content creation,tailoring it to individual consumer preferences and the dynamic context of CTV viewing.For instance,machine learning algorithms can process real-time viewer data,generating personalized ad campaigns that resonate with viewers current interests and behaviors,thereby enriching the viewing experience and boosting engagement rates.Furthermore,the advent of AI-driven ad platforms heralds a future where ads are dynamically optimized in real time,ensuring the most effective content reaches the right audience at the optimal moment.This level of sophistication in ad targeting and delivery not only promises to enhance the consumer experience but also maximizes the return on investment for advertisers.In retail media networks,AI enabled content targeting consumer behavioral data is incredibly powerful.”said Chris Riegel,CEO at STRATACACHE.“Pairing the retailers knowledge of what the customer did buy with the in-store sensor insight of what they shopped and considered allows the retailers and the brands to hyper-target messaging to consumers in-store,in app and at home on CTV with ultra precision messaging tailored exactly to their interest and tracking conversion back to automatically improve the results of campaigns.Furthermore,the integration of voice recognition technology with CTV could revolutionize how consumers interact with ads,enabling voice-activated purchases or inquiries that further streamline the shopping experience.This seamless interaction would not only elevate user convenience but also provide advertisers with invaluable insights into consumer preferences and behaviors,paving the way for more nuanced and effective advertising strategies.As retail media and CTV continue to converge,the potential for innovative partnerships is boundless,promising a future where advertising is not just a pathway to purchase but a memorable part of the consumers daily life.The future of Connected TV(CTV)represents a colossal opportunity to craft universal solutions on a large screen,delivering an experience that is not only immersive but also accessible on a grand scale,”said David Spencer,Manager of Emerging Media&Partnerships at General Motors.“This is a chance to blend the interactivity of websites and gaming with the convenience of universal accessibility.The introduction of voice instructions,moving beyond the conventional remote,is a pivotal step towards creating universally intuitive and engaging consumer experiences.”But the focus should always be on the consumer experience.Its not just about reaching the audience but engaging them in a meaningful dialogue,and the amalgamation of retail media and CTV offers a potent channel for this communication.28 Key-Takeaways Understand the Convergence of Commerce Media and Video:Businesses should actively pursue the integration of commerce media and CTV,crafting campaigns that harmonize e-commerce with engaging video content.This requires investing in technologies and forming partnerships that enable seamless transitions between watching content and making purchases,thereby creating a cohesive narrative across all consumer touchpoints.Leverage the Growth of CTV and Shoppable TV:Companies should capitalize on the expanding CTV and shoppable TV market by producing interactive advertisements that facilitate direct purchases.Staying attuned to the latest trends in CTV will help tailor content and functionalities to evolving viewer preferences,ensuring relevance and engagement.Privacy-First Approach:Emphasizing privacy in the handling of consumer data is paramount.Companies should develop strategies that protect user data while still leveraging it for targeted advertising.Implementing strict data governance policies and privacy-by-design principles will ensure compliance with regulatory standards and maintain consumer trust.Create Omnichannel and Seamless Experiences:Developing omnichannel strategies that deliver consistent messaging and user experience across various platforms is crucial.Investing in technologies that allow for real-time content and inventory synchronization across channels will support a frictionless consumer journey,from digital to physical touchpoints.Measurement and Optimization:Establishing robust metrics and continuously analyzing campaign data will help in refining media planning and creative strategies.This involves a balance of traditional KPIs and innovative metrics to gauge the true impact of CTV and shoppable ads on ROI and overall sales performance.Data Partnerships and Collaboration:Forming data partnerships should include a strong focus on privacy,utilizing tools like data clean rooms to facilitate secure data sharing and collaboration.These partnerships should aim to enhance audience targeting and campaign personalization while rigorously adhering to privacy regulations,ensuring that consumer data is handled responsibly and transparently.Prepare for Future Innovations:To stay competitive,organizations should explore and invest in emerging technologies such as AI-driven ad platforms,augmented reality experiences,and voice-activated commerce.Testing these innovations in controlled environments can help gauge their market readiness and potential for scaling.Adopt a Strategic and Agile Approach:In a rapidly evolving market,adopting a flexible and strategic approach is key.This includes fostering an innovative culture that encourages experimentation and learning,allowing for quick adaptation to new technologies,consumer trends,and market changes.This agility will enable businesses to remain at the forefront of the retail media and CTV landscape,driving sustained growth and customer engagement.29 Acknowledgement This document was developed by the IAB Retail Media Network Committee.This project represents weeks of collaboration and sharing of expert insights from a cross-section of our industry,including Retail Media Committee and Video Board,with the objective of providing an overview of the opportunity of data partnerships with Retail Media Networks and Video publishers to enable the future of commerce and shoppable media.IAB would like to extend a special thanks to the following individuals that contributed their time&insight in support of this paper.Contributors Amanda Vice,Senior Director,Data,Tech Consulting,OMD USA Amber Roberts,Partnership Director,North America,Threefold Ami Lathia,Director,Product Management,Off Platform Commercialization Strategy,Roundel Anna Kruse,VP,Best Buy Ads,Media Strategy,Best Buy April Carlisle,EVP,Commerce,Spark Foundry Benedict Wagstaff,Senior Director,Business Development,Retail Media-NA,The Trade Desk Betty Chung,Head of Growth,Retail Media,Microsoft Blair Robertson,CTO,Innovid Brian Gleason,Chief Revenue Officer,Criteo Bryan Gildenberg,Founder,CEO,Confluence Commerce Cara Hoenkhaus,Global Communications Manager,InfoSum Cara Pratt,SVP,Kroger Precision Marketing Carolina Cifuentes,Gerente Marketing,Operacion,Cencosud Charel MacIntosh,Global Head,Business Development,Strategic Partnerships,Clinch Chechu Lasheras,Chief Strategy Officer,Canela Media Chris Riegel,CEO at STRATACACHE Christine Foster,VP,Media Operations,Kroger Precision Marketing Christy Ramroop,VP,Strategic Retailer Services&Commerce Strategy Transact,Omnicom Company Group Claire Wyatt,VP,Business Strategy,Marketing Science,Albertsons Media Collective Cody Tusberg,SVP of Retail Media,The Acosta Group Dan Mouradian,SVP,Global Client Solutions,Innovid Danielle Brown,SVP,Data Enablement,Category Strategy,Disney Advertising,The Walt Disney Company David Cohen,CEO,IAB David Spencer,Manager,Emerging Media and Partnerships,Global Media Operations,General Motors Derek Nelson,Sr.Director,Retail Media Consulting,Ovative Group Devon DeBlasio,Global VP,Product Marketing,Infosum Eduardo Gauna,Head Cencosud Media,Cencosud Evan Hovorka,VP,Product Innovation,Albertsons Media Collective Gretchen Bobroff,Head of Retail Media,Magnite Halli Goddard,Solutions Lead,Offsite Product Innovation,Kroger Precision Marketing Hashim Mian,Senior Director,Commerce Media,PubMatic Jessica Hondolero,VP,Creative Solutions,Clinch 30 Jill Cruz,EVP,Commerce Strategy,Publicis Commerce John Storms,Senior Director,Head of Sales,Business Development,Lowes One Roof Media Network Jonatan Fasano,Head of Product,Walmart Connect Mxico Kate Monaghan,EVP,Digital Investment,Horizon Media Katie Arena,VP,Marketing,Clinch Kelly Liyakasa,Director,Corporate Communications,The Walt Disney Company Kelly Metz,Chief Investment Officer,OMD Kelsea Longanacre,Associate Director,Brand Marketing,Clinch Lawrence Taylor,President,Retail 4 Brands Lindsay Boesen,VP,Marketing,KERV Lidia Ruelas,Manager,Ads Marketing,Roku Lindsay Pullins,Director,Ad Revenue Strategy,Partnerships,Roku Lori Johnsoy,Head of Global Retail Media&CPG Strategy,LiveRamp Louqman Parampath,VP,Ad Product Management,Roku Lucas Pickett,Manager,Marketing,Infosum Luciana Barchini,Founder,MonetizaMe Marika Roque,Chief Innovation Officer,KERV Marie Hoffman,Head of Growth,Habu Mark Heitke,Director,Ad Products,Audience Strategy,Best Buy Ads Mary Sheehan,VP,Category Solutions,CPG,Retail,Restaurants,The Walt Disney Company Melanie Kaufman,Senior Manager,Ad Measurement,Roku Michael Ellgass,EVP,Media,CPG,Retail Media,Circana Mika Takahashi,Director,E-Retail,iProspect Nate Pinkston,Head of Growth,Retail Media,Microsoft Nich Weinheimer,EVP Strategy,Skai Nicolas Pirog,Director,Measurement Strategy,Target Nikhil Raj,Chief Business Officer,Retail Media,Moloco Nikki Neary,SVP,Digital,Horizon Media Oscar Padilla,SVP Data and Audience Solutions,Canela Media,X Orlando Uribe,Agency Development&Platforms Sales Lead,Walmart Connect Mxico Paul Longo,Global Head of Retail Media Sales,Microsoft Paulo Gaudencio dos Anjos,Director,Data&Analytics Solutions,Microsoft Paulo Schiavon,Director,Retail Media Partnerships,Unlimitail Ricardo Carvajal,Commercial&Operation Lead,Walmart Connect Mxico Rose Tagas,SVP,Commerce,UM Commerce Ryan Mayward,SVP,Retail Media Sales,Walmart Connect Sagar Ganapaneni,Data Science&Analytics Lead,Intuit Sean Crawford,Managing Director-North America,Threefold Shawn McGahee,Head of Retail Media,Google Stacey Reney,VP,Marketing Innovid Steve Baxter,EVP,Retail Media,Ovative Group Steve Reich,Senior Director of Publisher Development-CTV,Ericsson Emodo Tara Hekmat,Client Director,Threefold Victor Manuel Rivera Vela,Head of Marketing,Walmart Connect Mxico Vijoy Gopalakrishnan,SVP,Principal,Product Management,Circana Wendy Arnon,Director,Media Center,IAB 31 Video Initiatives and Working Groups Retail Media Partnerships will be an important upside revenue driver for CTV,publishers,and platforms.The evolution in streaming with an emphasis on ad-supported properties,there is a need for standardization of new ad formats.Standardization of digital video formats will provide upsides in planning,buying,ad ops and measurement.While retail media will close the loop between ad spend and commerce sales,there is a heightened need to address nuances in measurement.Lack of adoption of Creative ID as traditional analog media channels transition to dynamic digital platforms has created inefficiencies and over frequency.IABs Media Center Roadmap includes several initiatives to address these issues with the following projects:Project:Standardization of CTV Video and Social Media Formats Buyers and brands are faced with a wide range of ad formats and solutions designed to enable interactivity,shoppability,and full-funnel engagement,but what formats are scaling best and should be standardized across publishers and platforms?This standardization of CTV Video and Social Media Format project will conduct a survey of digital video ad creative currently in use and result in a visual landscape of providers along with a creative gallery to demonstrate formats.Project:Evangelize Adoption of Creative ID(in collaboration with Tech Lab)Ad creative names are rekeyed between 20-30 times throughout the life of an ad,causing inaccurate reporting,costly campaign reconciliation and over frequency when the same ad(differently named)is served to the same user.This project will evangelize standardized creative metadata and explain why it matters for brands,agencies,and publishers from a business perspective in collaboration with Tech Lab Ad Creative ID Standardization technical requirements.Project:Anatomy of a Video Impression across measurement suppliers(in collaboration with MAD)The purpose of this guide is to offer a clear explanation of what the core elements of a video impression are,what various measurement partners use as source data and how/whether they map back to current MRC-IAB standards.How to Get Involved?The Advanced TV Committee serves as a vital forum focusing on the modernization of the television ecosystem through the integration of data,targeting,measurement,interactivity,and engagement technologies.It facilitates updates on industry initiatives,encourages the sharing of research,hosts discussions with experts,and gathers insights from members on current trends.This committees work ensures the television sector remains innovative and responsive to the evolving digital landscape.This group is ideal for members who are actively involved in the industry.Click to see The Advanced TV Committees current participants and Member Companies.The Digital Video Committee operating mission is to advocate for digital video as a potent marketing tool for the entire digital video ecosystem.This committee serves as a vital forum for members to share updates and research findings and to engage in discussions with experts,while also providing insights into current trends.This group is ideal for members who are actively involved in the industry.Click to view The Digital Video Committees participants and Member Companies.32 Join the Advanced TV Committee and/or the Digital Video Committee using IAB Group Participation Request Form or send an email to media-.Commerce Initiatives and Working Groups The Commerce Media Committee brings together key stakeholders from the retail media landscape,including buyers,sellers,and advertising technology solutions.Its mission is to harmonize advertising business needs,requirements,and standards,aiming to streamline the buying and selling process.This initiative fosters an environment conducive to growth,creativity,and innovation.By facilitating the exchange of updates,research,and insights,as well as hosting discussions among experts.IABs MAS Center Roadmap includes several initiatives to address these issues with the following projects:DOOH and In-Store Retail Media Working Group Aimed at empowering and guiding retailers,agencies,brands through the intricacies of DOOH&in-store opportunities with the retail media landscape,spanning from activation to measurement.With the objective of improving collaboration,defining measurement metrics,outlining measurement frameworks,and developing a customer-centric strategy.DOOH&In-Store Retail Media Playbook Retail Media Measurement Working Group 2.0 Following the IAB/MRC Retail Media Measurement Guidelines,the working group will focus on tactical explainers that enable the adoption and use of the standards for optimization,budget allocation,data collaboration,and advanced modeling methodologies.Commerce Media Planning,Measurement and Optimization Explainer Data Collaboration and Enablement for Commerce media Join the Commerce Media Committee or the Retail Media Working Groups using IAB Group Participation Request Form or send an email to Upcoming Events The IAB NewFronts IAB NewFronts is for brand marketers and media buyers to get a first look at the latest cutting-edge digital video content and marketplace innovation spanning four days in New York City(April 29-May 2).This event connects brands with the latest digital video content and innovations that facilitate valuable partnerships.Back by popular demand,the IAB Connected Commerce Summit will dive into where the future of retail commerce is heading and how it could improve business operations.Attendees will hear from thought leaders in commerce and retail media about the most impactful strategies that will help brands stay ahead of the game.Theme will focus on the rise of marketplaces highlighting innovations across CTV,DOOH,Social Commerce,and Retail Media with deep dives on measurement!33 About IAB The Interactive Advertising Bureau(IAB)empowers the media and marketing industries to thrive in the digital economy.Its membership comprises more than 700 leading media companies,brands,agencies,and the technology firms responsible for selling,delivering,and optimizing digital ad marketing campaigns.The trade group fields critical research on interactive advertising,while also educating brands,agencies,and the wider business community on the importance of digital marketing.In affiliation with the IAB Tech Lab,IAB develops technical standards and solutions.IAB is committed to professional development and elevating the knowledge,skills,expertise,and diversity of the workforce across the industry.Through the work of its public policy office in Washington,D.C.,the trade association advocates for its members and promotes the value of the interactive advertising industry to legislators and policymakers.Founded in 1996,IAB is headquartered in New York City.https:/ collection and use of data to reach audiences and measure online advertising campaigns is central to powering the digital advertising ecosystem.The Measurement,Addressability&Data Center aims to provide essential industry guidance and education on solutions amid changes in underlying technology and privacy regulations in a constantly evolving ecosystem.The Measurement,Addressability&Data(MAD)Center focuses on the following initiatives:Measurement&Attribution Addressability Privacy Retail Media State of Data 34 Contact Information Jeffrey Bustos Vice President Measurement,Addressability&Data Center IAB Measurement,Addressability&Data Center IAB Media Contacts Kate Tumino/Brittany Tibaldi 212-896-1252/347-487-6794
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MAY 2024The Acceleration of Principal MediaWhat Marketers Need to KnowEXECUTIVE SUMMARYPAGES Acceleration of Principal MediaTABLE OF CONTENTSI.OVERVIEWPAGE 3II.EXECUTIVE SUMMARY PAGE 7III.PRINCIPAL MEDIA IS NOT NEWPAGE 10IV.PRINCIPAL MEDIA IS NOW DRIVING HOLDING COMPANY PROFITSPAGE 11V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIAPAGE 13VI.WORKING VERSUS NON-WORKING COSTSPAGE 30VII.GUIDELINES FOR THE USE OF PRINCIPAL MEDIAPAGE 31VIII.THE MEDIA AUDITOR PERSPECTIVEPAGE 34APPENDIXPAGE 38ANA MASTER MEDIA BUYING SERVICES TEMPLATE NON-TRANSPARENT SERVICESPAGE 39ABOUT THE SURVEY RESPONDENTSPAGE 43ACKNOWLEDGEMENTSPAGE 45ABOUT THE ANAPAGE 463|The Acceleration of Principal MediaPrincipal media has been getting increased attention,and marketers need to be aware and knowledgeable.For years,advertising agencies have acted as“agents”for their clients.Thats where the term“agency”comes from.An agent is authorized to act on anothers behalf,with their best interests in mind.Increasingly,advertising agencies are now offering services where they (or their affiliates)are acting as“principals”rather than agents.That means they acquire media(or rights to media at certain rates)for their own benefit and sell the media to their clients.In this document,when we refer to“principal media,”we mean any non-transparent services1 offered by the agency,which may include services other than media services.The use of principal media for many marketers is growing and the top benefit is reduced cost.2 The purpose of this paper is to increase awareness and help educate client-side marketers on principal media the background,benefits,challenges,and guidelines so marketers can make an informed decision about the role of principal media for them.Characteristics of principal media:The agency or its affiliate is not an agent of the client.The agency is the reseller of the media or other service.Clients potentially dont know where or how the agency acquired the inventory.The principal media is often sourced by a different agency affiliate.The agency is delivering media where the actual price(if any)is not disclosed,and the agency markup is not known.Principal media is usually positioned to clients based on cost savings and access to better or exclusive inventory.The model may include assets other than media,such as data or use of proprietary agency tools/platforms.Audit rights are limited.Notably,advertisers cant have access to vendor invoices.Agencies ask marketers to opt in to these transactions,unless the marketer/agency contract does not require such an opt-in.I.OVERVIEW1The ANA Master Media Buying Services Agreement Template Version 3.0 defines Non-Transparent Services as Services or other goods or services offered by Agency(either directly or indirectly)whereby Advertiser is intentionally not afforded full transparency to underlying costs or markup or is otherwise required to give up certain reporting or other rights,such as audit rights,where a member of Agency Group has access to such information.Such services include Inventory Media and insert Agencys name for its specific types of non-transparent services.2Based on a quantitative survey to ANA client-side marketers fielded in February 2024 which generated 139 responses;details in section V.4|The Acceleration of Principal MediaChanges in agency compensation models from marketers have led agencies and holding companies to accelerate the use of principal media.In addition,some marketers have extended their payment terms to agencies.There has been a long-term emphasis from marketers on reducing agency fees,which has more recently been driven by pressure from marketing procurement.Furthermore,the 2016 ANA media transparency report3 drove awareness of the practice of agencies taking undisclosed rebates from media companies;many marketers then updated their media agency contracts to preempt that practice.Agencies have turned elsewhere for revenue,especially the publicly traded holding companies,given pressure from Wall Street and obligations to shareholders.One well-known industry agency search and relationship consultant4 told us,“The client side continues to pressure agencies to do more work for a lower fee,so the agency has to make up the shortfall with other revenue streams.”Enter the acceleration of principal media.Many marketers continue to pressure their agencies to“drive media costs down.”The 2023 ANA Programmatic Media Transparency report5 addresses that extensively.According to the report,there is clearly too much focus from marketers on reducing costs,and that can come at the expense of quality and performance.The primary incentive driving programmatic media buying behavior is often cost getting the most impressions for every dollar.Principal media is often positioned by agencies as an opportunity for media cost savings.I.OVERVIEW3An Independent Study of Media Transparency in the U.S.Advertising Industry4Joanne Davis,president,Joanne Davis Consulting,Inc.and partner and co-CEO,SCAN International5ANA Programmatic Media Transparency Study Complete ReportCase Study#1According to a media executive at a financial services company:Principal media can have a beneficial role in the overall mix to get high efficiencies on commodity media,especially when faced with unexpected savings requirements.Weve successfully used it,mainly with linear TV,to help achieve marketings contribution to enterprise-wide efficiency goals,as well as to maintain optimal weight in response to ad hoc budget reductions.Its a relatively turnkey lever for savings of 10 to 15 percent on pockets of standardized,“spots and dots,”non-biddable media.You just need to do your homework and have the appropriate controls in place.That includes an agency contract stipulating its used only on an opt-in,case-by-case basis with prior written approval every time by a designated executive,as well as full post-buy deliverables.Principal media has perfectly valid applications for advertisers that manage it tightly,and I know several client-side media stewards that wouldnt want it removed as one of the arrows in their quiver.5|The Acceleration of Principal MediaThe terms for principal media continue to evolve,and include:Capital buys Inventory media Non-disclosed media/services Non-transparent services Opt-in media/services Proprietary media/services Special programming Value-based media/services Value potsPrincipal media has nothing whatsoever to do with the“upfront.”The perspective provided here was informed by the collective guidance of multiple sources:A quantitative survey to ANA client-side marketers fielded in February 2024 which generated 139 responses Follow-up in-depth qualitative interviews with 16 client-side marketers who took the survey Input and review by interested members of the ANA Media&Measurement Leadership Council Input and review by outside subject matter experts,including:Legal:Reed Smith Media Auditors:Cortex Media,Media Market Compliance,PwC Other relevant work from the ANA(including the 2016 K2 report)as well as coverage in the advertising trade pressI.OVERVIEW“While principal media can indeed provide the benefit of cost savings,marketers need to go into such deals with their eyes wide open.”A MEMBER OF THE ANA BOARD OF DIRECTORS6|The Acceleration of Principal MediaThis project builds upon the work of the Global CMO Growth Council,which was established by the ANA and Cannes Lions to focus on driving enterprise growth.The CMO Growth Council has identified four global growth priorities and a 12-point industry growth agenda.Media and Supply Chain Transparency is a key area of focus for the ANA Growth Agenda,under the Brand,Creativity,and Media growth priority.Marketing Organization and Agency Management is also an area of focus,under the Talent and Marketing Organization growth priority.I.OVERVIEWTalent/LeadershipDevelopmentBrandPurpose/Brands forHumansGlobalSustainability Diversity,Equity,andInclusionBrand Safetyand Ad FraudMedia and Supply ChainTransparency Data,Analytics,and TechnologyMeasurement and AccountabilityBrand/MarketingInnovationInclusive and Sustainable MarketingPrivacy,Advocacy,andSelf-RegulationMarketing Organizationand AgencyManagementAcademia/Next-GenMarketersBrand,Creativity,and MediaData,Technology,and MeasurementTalent and Marketing OrganizationDrivingBusiness&BrandGrowth Growth Agenda7|The Acceleration of Principal MediaPrincipal media has been getting increased attention,and marketers need to be aware and knowledgeable.The purpose of this paper is to increase awareness and help educate marketers on principal media the background,benefits,challenges,and guidelines so they can make an informed decision about the role of principal media for them.Increasingly,advertising agencies are now acting as principals rather than agents.That means they acquire media therefore becoming the owner,or“principal,”of that media and resell the media to their clients.Changes in agency compensation models from marketers as well as pressure from marketers to extend payment terms and“drive media costs down”have led agencies and holding companies to accelerate the use of principal media.Although principal media has been getting increased attention,it has been around for at least 10 years.The 2016 ANA-commissioned report“An Independent Study of Media Transparency in the U.S Advertising Industry”from K2 Intelligence notes it extensively.According to an auditor,in the past 18 months,“it has been seen everywhere.”A fourth quarter 2023 article in Digiday6 credits“a robust media buying business”for holding-company growth.The article goes on to say,“The key takeaway here is that media often acts as the primary driver of growth for agency holding companies,perhaps because they derive margins from arbitrage around media buying.”According to ANA research among client-side marketers:Only about half(48 percent)of survey respondents are“very familiar”with principal media.Meanwhile,39 percent are somewhat familiar,and 13 percent are not familiar.This overall lack of knowledge is concerning.“Principal media is ubiquitous,”according to one survey respondent.Television and the open web are the most common media types.But other media and non-media are also used:digital walled gardens,audio,search marketing,print,influencer marketing,and research.About half(47 percent)of respondents have used principal media in the past year.Just over a third(35 percent)have not,and 18 percent almost one-fifth dont know if principal media has been part of their companys media activity in the past year.It is concerning that 18 percent of respondents dont know.Forty-one percent of respondents expect to use principal media over the next year.Its more likely that larger advertisers,companies with a 2023 total annual U.S.media budget of$200 million or more,have used principal media in the past year(62 percent)than smaller advertisers have(47 percent).Its also more likely that larger advertisers expect to use principal media in the next year(55 percent)than do smaller advertisers (34 percent).II.EXECUTIVE SUMMARY6Why media agencies remain the cornerstone of hold group profitability:Digiday,October 31,2023 8|The Acceleration of Principal Media The use of principal media is increasing for 24 percent of respondents and staying about the same for 55 percent.The key reasons that the use of principal media is increasing:Marketers are increasingly looking for greater efficiencies in their media buys.Agencies are more aggressively recommending principal media solutions,often as a result of reductions in traditional agency compensation.The top benefit of principal media for marketers is reduced cost,followed by the benefits of better inventory and access to exclusive inventory not otherwise available.There was mixed feedback in our one-on-ones regarding the benefits of better inventory and access to exclusive inventory.There are challenges for marketers with principal media.The top challenge is uncertainty if the recommended media is in the clients best interest.Multiple qualitative interviewees had concerns about conflict of interest,and one specifically told us,“I dont know if my agency is recommending principal media because its the best media for me,or the best media for them.”Other challenges include loss of audit rights,lack of visibility on agency profit,and loss of quality in media placement.Principal media was part of an agency pitch for about one-quarter(27 percent)of those that have done an RFP before engaging their current agency.It is imperative that marketers have guidelines for the use of principal media.Those guidelines should include:It is of the most importance to ensure that the contract with your agency is up to date with clear language to address principal media.Refer to section 9 of the ANA Master Media Buying Services Agreement Template Version 3.0 for suggestions on how to address principal media(referred to as“Non-Transparent Services”)in your agency contract.7 The agency should be required to provide a clear business case detailing why principal media is recommended and is consistent with the marketers media strategy,objectives,and buying guidelines,and is in the best interest of the marketer.There should always be options presented that do not consist of principal media.Have a clear internal approval process for the use of principal media.Have your own media department(or alternatively,a media auditor should there not be an internal media team)evaluate the proposal for reasonableness and to see how it compares to historical and/or market pricing and any agreed-upon agency goals and KPIs.Final approval should be centralized with a single,senior-level person to coordinate the companys total ongoing investments in principal media.Approvals should be done for each purchase in advance via a separate document or approval process.Require that principal media be clearly identified on media flowcharts.Do not accept vague language such as,“Principal media may be included.”Require specifics.II.EXECUTIVE SUMMARY7All advertisers should ensure that they bespoke their agency contracts and work with qualified counsel to best protect their interests.9|The Acceleration of Principal Media If principal media will be part of your media strategy,consider a cap for principal media that is,it will be no more than X percent of the total budget for a specific period of time.Auditing of principal media transactions should be allowed in the same way as for regular agent-based transactions.The only difference is that the agency would only provide access to the costs charged by the agency(or its affiliate as applicable)to the advertiser instead of the costs paid to third-party vendors.Proof of performance metrics and access to transaction data should be made available for principal media with the same level of detail expected for agent-based buys.Those could include(but are not limited to)impressions,CPMs,outcomes,viewability,and IVT.Understand the impact that principal media would have on rebates that otherwise would have been earned under a non-principal media buy.Consider whether commissions or fees that would normally be paid to the agency for the management of agent-based transactions should or should not apply to principal media buys.Keep in mind that the agency will be making a profit through markups on these purchases.See section VII for the guidelines in their entirety.II.EXECUTIVE SUMMARY10|The Acceleration of Principal MediaAlthough principal media has been getting increased attention,the concept is not new.In April 2016,Ad Age published the article“Risky Business:Why Media Agencies Are Betting on Principal-Based Buying.”That article quoted GroupM Chairman Irwin Gotlieb publicly acknowledging at the 2015 ANA Advertising Financial Management Conference that the relationship between media agencies and clients had gotten to the point that the term“agent”no longer fits.You cease to be an agent the moment someone puts a gun to your head and says These are the CPMs you need to deliver,he said.June 2016 saw the release of the ANA-commissioned report“An Independent Study of Media Transparency in the U.S Advertising Industry”from K2 Intelligence.Section 4.3 from that report is titled“K2 Found Substantial Evidence of Potentially Problematic Agency Conduct Concealed By Principal Transactions.”Relevant highlights from that section:As described by multiple sources,one of the most common types of principal arrangements is one in which an affiliated entity within an agency holding company structure(e.g.,an ATD)acquires the media.The AOR then purchases the media from the ATD at a significant markup and sells the media to the advertiser at the AORs cost and with a waiver of the typical agency fee.According to information provided to K2,markups on media sold through principal transactions can range from approximately 30 to 90 percent.Sources also indicated that,as a result of these higher margins,media buyers are sometimes pressured and/or incentivized by their agency holding companies to direct client spending to this media,regardless of whether such purchases are in the clients best interest.In addition,sources have stated that the agency may not disclose to the advertiser that premium media is unavailable through certain principal transactions.Multiple sources told K2 that agencies engage in“advance buys”of digital media i.e.,purchases in advance of an advertisers need for such media in order to obtain discounts.Following an advance purchase,there is a window of time during which the purchased media must be used.Therefore,an agency theoretically runs the risk that it will realize a loss if it fails to resell the media within the specified time period.Sources reported,however,that agencies take specific steps to greatly minimize that risk.During the course of this study,K2 found substantial evidence that the lack of transparency inherent in principal transactions enables agencies to engage in potentially problematic conduct i.e.,conduct that may not be in the advertisers best interest.Sources told K2 that principal deals were attractive to advertisers for two main reasons:(1)the cost of the media appears to be lower,and(2)there is no agency fee for principal deals.Despite the fact that the K2 study is now eight years old,the subject matter experts who provided guidance for this report(see the Acknowledgements section)confirmed that they still see structures and practices like those noted above today.Principal media has been around for some time at least 10 years,according to both Cortex Media and Media Marketing Compliance.Per Cortex and MMC,principal media has historically been“heavily used”in Australia,Canada,Germany,and the U.K.,and in the past 18 months,“it has been seen everywhere.”III.PRINCIPAL MEDIA IS NOT NEW11|The Acceleration of Principal MediaAccording to Brian Wieser,a noted strategic financial analyst of global advertising,technology,and marketing services businesses and the founder of Madison and Wall,“Publicis and Omnicom have been the most aggressive in this field i.e.,principal media in the past year,while IPG and WPP have been the least aggressive,and each companys organic growth trends mirror these orientations.”8The primary principal media offering for Publicis is APEX Exchange,or simply APEX,which describes itself as follows:A distinct next-generation trading entity within Publicis Media that identifies and invests in emerging market trends to benefit Publicis clients Develops innovative offerings through direct partnerships and principal investments that allow clients of all sizes to benefit from custom solutions that best fit their business challenges in an increasingly complex media environment Clients opt in to solutions outside the agencys core services that offer tangible benefits,including guaranteed outcomes,increased flexibility,and advantageous pricingAccording to Publiciss February 8,2024 release of results for 20239:Full-year 2023 net revenue organic growth was 6.3 percent,with stronger than expected Q4 growth at 5.7 percent.Media,one-third of revenue,grew by double digits on top of double digits in 2022,benefiting from both market share gains and organic growth at existing clients.OMnet is Omnicoms principal-based buying group.Yet information on OMnet is difficult to find on the Omnicom Media Group website.According to Omnicoms February 6,2024 release of results for 202310:Advertising&Media represented 53.7 percent of total Omnicom revenue in 2023.Organic growth for Advertising&Media was 6.5 percent,compared to 4.1 percent for the company overall,and was bigger than any of the other disciplines identified in the report.The report specifically said the growth for the Advertising&Media discipline was“led by the performance of our global media businesses.”Media is therefore driving revenue growth at both Publicis and Omnicom.IV.PRINCIPAL MEDIA IS NOW DRIVING HOLDING COMPANY PROFITS8Madison and Wall,February 8,20249Publicis Groupe Full Year 2023 Results,February 8,202410Omnicom 2023 Fourth Quarter&Full Year,February 6,202412|The Acceleration of Principal MediaAccording to a report in MediaPost11 in July 2023,for years,Interpublic Group has resisted unlike competitors buying and reselling media to advertisers out of concern that the practice would compromise,or at least appear to be a conflict with its obligation to serve as agent to its clients.But in a July 2023 earnings call,CEO Philippe Krakowsky commented that the company was reconsidering its position on principal media.“Were definitely looking at that,”Krakowsky said,responding to a question from Michael Nathanson of MoffettNathanson.In February 2024,Campaign12 reported,“IPG is looking to ramp up its principal-based media buying activities.”A fourth quarter 2023 article in Digiday13 credits“a robust media buying business”for holding company growth.It notes,sourcing Brian Wieser,that media accounts for nearly 40 percent of WPPs revenues,a third of Publiciss,and roughly 20 percent each of Omnicom and IPG.(Data here refers to media agencies as a total of all holding company revenue,and not just principal-based trading.)The article goes on to say,“The key takeaway here is that media often acts as the primary driver of growth for agency holding companies,perhaps because they derive margins from arbitrage around media buying.”Its also relevant to note that when agencies are acting as principal,they are allowed to count that media as topline revenue.Media is no longer a pass-through transaction.While the cost of goods sold goes up(i.e.,the media obtained by the agency from the media company,which may or may not have had a monetary cost),revenue also increases(i.e.,the cost the agency charges its client for the principal media).A member of the ANA Media&Marketing Leadership Council remarked:“Think about the impact that has on earnings calls,when holding companies can tap into the volume that working media dollars bring into revenue numbers.The agency is benefiting significantly as a result of the revenue reporting.That is grounds for marketers to ask for more in return.”Respective principal trading divisions for the various holding companies:IV.PRINCIPAL MEDIA IS NOW DRIVING HOLDING COMPANY PROFITS11IPGs Krakowsky Confirms Company Reconsiders Becoming Principal Media Seller:MediaPost,July 21,202312IPG declines in 2023,targets flat 2024 as last years challenges continue:Campaign,February 8,202413Why media agencies remain the cornerstone of holding group profitability:Digiday,October 31,2023 Holding Co.Principal Trading Divisiondentsu Agyle Advantage,Amnet(part of Amplifi)HavasHavas InventoryIPGOrionOmnicomOMnetPublicis APEXWPPNexus(includes Finecast and Xaxis),GroupM Flex,plistaThe names of these principal trading divisions are subject to change.13|The Acceleration of Principal MediaA quantitative survey to ANA client-side marketers was fielded in February 2024,generating 139 responses.About the respondents:75 percent are at job levels of director and higher.64 percent are with companies which are primarily B-to-C,8 percent are with companies which are primarily B-to-B,and the remainder are with companies that are both B-to-C and B-to-B.47 percent are with companies with a 2023 total annual U.S.media budget under$200 million.Details are in the appendix.The full survey is here.That quantitative research was supplemented by in-depth qualitative interviews with 16 client-side marketers who took the survey.Results of this research follow.V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA14|The Acceleration of Principal MediaV.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIANinety-five percent of the survey respondents passed the screener indicating“at least a working knowledge of my companys media investment strategies.”Screener:At Least a Working Knowledge of Media Investment Strategies RequiredYes95%No5%Knowledge:Media Investment Strategies(Screener)Base:139Q.I have at least a working knowledge of my companys media investment strategies.Then 128 respondents moved on to the primary survey.15|The Acceleration of Principal MediaOnly about half(48 percent)of survey respondents are“very familiar”with principal media14.Meanwhile,39 percent are somewhat familiar,and 13 percent are not familiar.This overall lack of knowledge is concerning.Again,the screener for respondents was,“I have at least a working knowledge of my companys media investment strategies.”Yet 39 percent are only somewhat familiar with principal media,and 13 percent are not familiar with it at all.Overall Knowledge About Principal MediaVery familiar48%Somewhat familiar39%Not familiar13%Knowledge:Principal MediaBase:128Q.What is your overall level of knowledge about principal media(sometimes called inventory media,proprietary media,and/or value-based solutions)and other non-transparent media?14The survey invitation said the following:We would appreciate your participation in a short survey about principal media(sometimes called inventory media,proprietary media,or value-based solutions)and other forms of non-transparent media.For years,advertising agencies acted as“agents”for their clients.An agent is authorized to act on anothers behalf,with their best interests in mind.Increasingly,agencies are oftentimes acting as“principal,”meaning,they acquire media(therefore becoming the owner of that media)and resell that to their clients.V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA16|The Acceleration of Principal MediaAbout half(47 percent)of respondents have used principal media in the past year.Meanwhile,35 percent have not,and 18 percent dont know if principal media has been part of their companys media activity in the past year.Use of Principal Media:Past YearYes47%No35%Dont know18%Use of Principal Media:Past YearBase:121Q.In the past year,has principal media(sometimes called inventory media,proprietary media,and/or value-based solutions)or other forms of non-transparent media been part of your companys media activity?It is concerning that 18 percent of respondents dont know if principal media has been part of their companys media activity in the past year.Its more likely that larger advertisers,companies with a 2023 total annual U.S.media budget of$200 million or more,have used principal media in the past year(62 percent)than smaller advertisers have(47 percent).V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA17|The Acceleration of Principal MediaPrincipal media represents a fairly low percentage of a companys total media budget for most respondents under 10 percent of the total media budget for 55 percent of respondents.Yet 8 percent allocate 50 percent or more of their total media budget to principal media.Principal Media:Percentage of Total Media Budget4%4# 5utween 50%and 75tween 25%and 50tween 10%and 25tween 5%and 10%5%Principal Media as a Percentage of Total Media BudgetBase:54*Q.Over the past year,roughly what percentage of your companys total media budget do you estimate to be comprised of principal media or other forms of non-transparent media activity?*Respondents whose companies used principal media in the past year.V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA18|The Acceleration of Principal MediaThe use of principal media is increasing for 24 percent of respondents and staying about the same for 55 percent.The key reasons that the use of principal media is increasing for some respondents:Marketers are increasingly looking for greater efficiencies in their media buys.Agencies are more aggressively recommending principal media solutions,often the result of financial pressures from marketers leading to reductions in agency compensation and extended payment terms.Change in Use of Principal Media7U%9%6%6%Increasing significantlyIncreasing somewhatStaying about the sameDecreasing somewhatDecreasing significantlyDont knowChange in Use of Principal MediaBase:53*Q.Is the use of principal media or other forms of non-transparent media activity at your company*Respondents whose companies used principal media in the past year.24%V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA19|The Acceleration of Principal MediaTelevision and the digital open web are the media types most often used.But other media digital walled gardens,audio,search,and print are also used.There was a comment from the qualitative interviews:“Principal media is ubiquitous TV,digital,audio,print,OOH,influencer,production,and content.”Influencer marketing was specifically mentioned by several qualitative respondents as an area where their agencies were increasingly acting as principals.Research was also noted as sometimes being part of principal agreements.All Media Types Active with Principal Media1208Dhp%PrintSearchAudioDigital walled gardensDigital open webTelevisionMedia TypesBase:50*Q.What media types are part of your companys activity in principal media or other forms of non-transparent media activity?*Respondents whose companies used principal media in the past year.V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA20|The Acceleration of Principal MediaRespondents were asked,“How important is the use of principal media and/or other forms of non-transparent media to your company to help it achieve objectives?”Fifty percent deem principal media not to be important vs.21 percent who do.Importance of Principal Media173)%Not important at allVery importantImportance of Principal MediaBase:48*Q.How important is the use of principal media and/or other forms of non-transparent media to your company to help it achieve objectives?Rate on a scale of 1 to 5 where 1=Not at all important and 5=Very important.*Respondents whose companies used principal media in the past year.50!%V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA21|The Acceleration of Principal MediaSixty-two percent have guidelines for the use of principal media.Guidelines for Principal MediaYes62%No38%Guidelines for Principal MediaBase:45*Q.Does your company have guidelines either internal or external with your agencies regarding the use of principal media and/or other forms of non-transparent media?If yes,please tell us a little bit about those guidelines.*Respondents whose companies used principal media in the past year.It is important to note that respondents to this question are with organizations which used principal media in the past year.Its concerning that nearly 40 percent do not have guidelines.Guidelines for the use of principal media are critically important.A later section in this report provides recommended guidelines.V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA22|The Acceleration of Principal MediaForty-one percent of respondents expect to use principal media over the next year.Expected Use of Principal Media:Next YearYes41%No34%Dont know25%Expected Use of Principal Media:Next YearBase:107Q.Over the next year,do you expect principal media(sometimes called inventory media,proprietary media,and/or value-based solutions)or other forms of non-transparent media to be part of your companys media activity?This is directionally consistent with past year use of principal media,where 47 percent have used it,35 percent have not,and 18 percent dont know.Its more likely that larger advertisers(total annual U.S.media budget of$200 million or more)expect to use principal media in the next year(55 percent)than do smaller advertisers (34 percent).V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA23|The Acceleration of Principal MediaThe top benefit of principal media for marketers is reduced cost.That is followed by the benefits of better inventory and access to exclusive inventory not otherwise available.Benefits of Principal Media 29ddy%Improved payment termsAccess to exclusive inventoryBetter inventoryReduced costBenefits of Principal Media(Top-2 Box)Base:89Q.In your opinion,how important are the following benefits of principal media and/or other forms of non-transparent media activity?Rate on a scale of 1 to 5 where 1=Not an important benefit and 5=Very important benefit.There was mixed feedback in our one-on-ones regarding the benefits of better inventory and access to exclusive inventory.One interviewee noted that their company was able to get into the Grammys via principal media(i.e.,access to exclusive inventory not otherwise available).Another felt strongly that there is a loss of quality with principal media,particularly in digital:“You dont always know whats in it.”Multiple interviewees felt that the benefits of better and exclusive inventory were “perceived”and not really the case.One said,“I dont understand how or why its better.”Another said,“I have a hard time believing that.”Another commented on the perceived benefit of exclusive inventory,saying,“That is where the shady underbelly of principal media is on display.”V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA24|The Acceleration of Principal MediaBenefits of Principal Media An auditor felt strongly that principal media,most times,is not“better”or“exclusive,”telling us,“Principal media often includes free space,as part of volume deals between the agency and a media company.And its free for a reason.”Improved payment terms were noted as a benefit(top-2 box)by 29 percent of respondents.Improved terms(that is,longer terms)are sometimes possible in principal media deals,as the agency owns the media outright and often doesnt have the pressure to pay a media vendor.Therefore,the agency can extend the payment terms,if that is important to the marketer.V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA25|The Acceleration of Principal MediaPrincipal Media Case StudiesV.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIACase Study#2Company Y is a marketer of alcoholic beverages.It uses some television in its media plan,acquired via the traditional upfront.But it is not a major TV buyer.Given the need to support a new product,more television was required.The scatter market was tight at the time,so that inventory would carry a CPM premium.Company Ys agency suggested principal media as a solution.Case Study#3The product portfolio for Company X is heavily dependent on a commodity whose price has increased significantly in the past two years.Price increases for the companys core product have already been implemented,but margins continue to be squeezed.Company X is cutting back on overall advertising spending and is now using principal media for the first time in recent memory,given the cost savings.The agency guaranteed a cost savings of approximately 15 percent.Company X is viewing this situation opportunistically.If principal media is able to meet the performance KPIs of its traditional,agent-based media buys,it could become a bigger part of the companys overall spending going forward.26|The Acceleration of Principal MediaPrincipal Media Case StudiesV.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIACase Study#4A pharmaceutical company uses principal media specifically for a division that has been challenged with declining sales and therefore also declining marketing budgets.Those declining budgets have meant that no funds are available for much-needed research support that could help optimize media investments.This company turned to principal media as a solution.The use of principal media has resulted in cost savings of approximately 15 percent,which has been reinvested in research focused on media effectiveness and marketing mix modeling.About 10 percent of the budget has been placed via principal media.For all principal media deals,the client requires that the agency provide a detailed cost/benefit analysis to support the recommen-dation,which includes an option without principal media.The marketer maintains that the principal media must be auditable for quality/performance and placement including IVT,viewability,brand safety,and adherence to inclusion/exclusion lists.The client understands that costs cannot be audited but insists that quality/performance and placement are indeed auditable.The client does not allow the savings generated by principal media to be automatically reinvested into buying more media.The agency is directed to buy to GRP goals and then advise the client on any unspent funds.The client then makes the decision regarding that money:whether to reinvest in more media,allocate the funds to research,or return it to the bottom line.Overall,principal media has been a good solution,given this companys situation.The ANA welcomes additional case studies on principal media.Please email those to .27|The Acceleration of Principal MediaThere are multiple challenges for marketers with principal media.The top ones:Uncertainty if recommended media is in the clients best interest Loss of audit rights Lack of visibility on agency profit Loss of quality in media placement Regarding the top challenge,multiple qualitative interviewees had concerns about conflict of interest,and one specifically told us,“I dont know if my agency is recommending principal media because its the best media for me,or the best media for them.”In addition,Manuel Reyes of Cortex Media feels there is another potential conflict:media companies may accept higher prices from agencies for their traditional agent buys in exchange for lower prices on principal buys.That latter point was noted in the 2016 K2 report.Another method for securing media for principal deals involves the negotiation and use of dual rate cards for the same media.Essentially,an entity within the agency holding Challenges of Principal Media 34Trtvvy%Lack of internal coordinationLoss of rebates/AVBs for media that provide themConcerns that the use of principle media buys could result in an increase in the cost of“regular”buysLoss of delivery guaranteesLoss of quality in media placementLack of visibility on agency profitLoss of audit rightsUncertainty if recommended media is in the clients best interestChallenges of Principal Media(Top-2 Box)Base:82Q.In your opinion,what are the primary challenges of principal media and/or other forms of non-transparent media?Rate on a scale of 1 to 5 where 1=Not an important challenge and 5=Very important challenge.Concerns that the use of principal media buys could result in an increase in the cost of“regular”buysV.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA28|The Acceleration of Principal MediaChallenges of Principal Media company,but not the AOR,will negotiate with the media supplier for two rate cards:(1)an AOR rate and(2)a lower ATD rate.In this scenario,the lower rate negotiated by the agency holding company is utilized for its principal entities,including the ATD.In contrast,the higher rate card is utilized by AORs to sell the media directly to advertisers in the capacity of an agent(as opposed to a principal).Audit rights are also more limited.Notably,marketers cant have access to vendor invoices,so they dont know the price the agency paid(if any)to acquire the media.In most cases,marketers are able to audit performance impressions,viewability,IVT,etc.However,marketers should clearly understand up front before commitments are made if there are specific restrictions regarding auditing,and should never give up the right to understand performance.An auditor told us,“Performance and price are linked,so audits in principal media deals are not as comprehensive.Clients need to go in with their eyes wide open.”With principal media,there is a lack of visibility on agency profit.Marketers dont know how much the media originally cost the agency(or if some media was acquired at no cost)and therefore dont know the agency mark-up/profit.And agencies generally do not agree to a cap on the mark-up.Marketers should consider the impact that principal media has on their overall compensation arrangements with agencies,including implications for any performance-based or incentive-based arrangements.Loss of quality in media placement was another challenge noted by respondents.That point was raised in the 2016 K2 report.generally,with these types of deals,the discounted media would typically not include the media suppliers best available inventory,as media suppliers attempt to include certain barriers in the contract designed to exclude their premium high-value inventory from the discount deal.Therefore,if an advertiser purchases media that stems from this type of deal,premium media may not be available,a fact which may not be disclosed to the advertiser.In our qualitative discussions,there were additional challenges brought up:Loss of access to first-party data:with the deprecation of cookies,first-party data is becoming increasingly important for targeting.But in most cases,marketers give up access rights to first-party data in principal media deals.Brand safety watchouts:the challenge of loss of quality in media placement has also led to brand safety concerns for some.Pricing for principal buys may be provided in aggregate,rather than by the various individual components of the media package.That has implications for business intelligence and marketing mix modelling,as this aggregated data makes it difficult to understand what specifically worked and what didnt.V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA29|The Acceleration of Principal MediaAmong all respondents to this question,14 percent have done an RFP before engaging their current agency where principal media was part of the pitch.But removing those who“Dont know”and who“did not have an RFP before we engaged our current agency”tells a different story.Principal media was part of the pitch for some one-quarter(27 percent)of those that have done an RFP before engaging their current agency.One of our qualitative interviewees told us about firsthand knowledge of a new business pitch where a media agency offered to waive its fee completely as long as the marketer agreed that all media would consist of principal media.Principal Media as Part of an Agency Pitch149%YesNoWe did not have an RFPbefore we engaged ourcurrent agencyDont knowPrincipal Media as Part of an Agency PitchBase:85Q.If you did an RFP before you engaged your current agency,was principal or other non-transparent media part of the pitch by the agency in order to meet pricing or other requirements?V.THE MARKETER PERSPECTIVE ON PRINCIPAL MEDIA30|The Acceleration of Principal MediaVI.WORKING VERSUS NON-WORKING COSTSThe traditional allocation of working(media)and non-working(includes production and agency compensation)cost has become somewhat antiquated.15 The emergence of earned and owned media has blurred the lines with paid media.An increasingly complex and fragmented media environment has led to an increase in production,and additional agency fees may be required to produce more content.Furthermore,the use of data for targeting is also on the rise,and there are costs associated with that.Nonetheless,we have heard on more than one occasion that some marketers are intrigued with principal media,as they see it as an opportunity to reduce non-working expenses(i.e.,agency compensation)in favor of working media investments.According to Joanne Davis,president,Joanne Davis Consulting,Inc.and partner and co-CEO,SCAN International:“Some marketers and procurement managers could not care less that the agency has extra revenue streams as long as they can tell their management that they lowered the agency fee(versus looking at the total cost of transparent and non-transparent).”Digiday16 reported on Brian Wiesers perspective:As Omnicom introduced OMnet and Publicis PMX,he said it became apparent that an increasing number of clients cut down on their so-called“non-working”expenses.This often led to reduced spending on agency services,even though they still required more services,he continued.Shifting a portion of that spending into“working”media,where the agency can generate what it needs to sustain its ability to provide the client with the comprehensive offering they desire,is a relatively graceful solution.The ANA strongly cautions marketers from employing principal media primarily for the perceived benefit of reducing agency compensation fees.Consider principal media only if other benefits most notably lower media costs make sense for your business.15Improve Brand Decisions:Replace Working/Non-Working Ratios with Deploy and Develop Allocations.Bruno Gralpois/Agency Mania Solutions,November 2023.16Digiday,Why media agencies remain the cornerstone of holding group profitability,October 31,202331|The Acceleration of Principal MediaVII.GUIDELINES FOR THE USE OF PRINCIPAL MEDIA1.Marketers should consider having a formal and detailed process for approving or not approving principal media(and other non-transparent services).Marketers should have a cross-functional understanding of the benefits and potential challenges of principal media.Such cross-functional team members could include media,finance,procurement,legal,and brand management,depending on how the company is set up.If the marketer has an internal media expert,that person should lead the cross-functional team.The team should establish clear policies on the companys position on and processes around principal media.2.Ensure that the contract with your agency is up to date with clear language to address principal media.If principal media purchase authorizations include any additional terms and conditions(such as loss of audit rights or loss of or change in data rights)which are not set forth in the contract,such terms and conditions must be provided to the marketer and their legal team for review and approval prior to the marketers agreement to the service.Make sure your contract prevails over any other authorization or PO language that is approved in the course of business.Any change in conditions should only be allowed at the contract level and explicitly forbidden to be implemented through other documents.Ensure that your agency contract explicitly forbids the agency from co-mingling principal buys with agent buys,and require the agency to confirm that no value was transferred between your agent-based and principal media buys.Consider a clause which states that budgets from different buys cant be changed by the agency without marketer authorization.Consider adding language to your contract that makes any principal buy that was not properly approved fully transparent,auditable,and with no markup,and that the marketer will only pay for the amount the agency actually paid for the media/service.Alternatively,expressly set forth another remedy.Any terms deviating from the contract or rights given up with respect to a particular principal media buy(rebates and incentives,data rights,audit rights,etc.)should be identified in each instance.Refer to section 9 of the ANA Master Media Buying Services Agreement Template Version 3.0.That section is provided in its entirety in the appendix here.3.The agency should be required to provide a clear business case detailing why principal media is recommended overall and is consistent with the marketers media strategy,objectives,and buying guidelines,and why it is in the best interest of the marketer.For the specific principal media offering being recommended by the agency,the business case should provide cost and audience delivery comparisons with KPIs between principal media and agent-based buys for the same media.There should always be options presented that do not consist of principal media.Before approving,have your internal media department(or alternatively,a media auditor should there not be an internal media team)evaluate the proposal for reasonableness to see how it compares to historical and/or market pricing and any agreed-upon agency goals and KPIs.32|The Acceleration of Principal Media4.There should be clear visibility into the media outlets being used in principal media deals.Marketers should know who their business partners are.5.Determine if your company is comfortable not having transparency on the cost of media to the agency,not understanding how much the agency is marking up these purchases,and the potential conflicts of interest that may arise from this model.Since most principal buys for digital media also require advertisers to accept that all tech,platform,and data costs will be bundled in the total non-transparent cost,decide if your company is also comfortable with that.6.Have a clear internal approval process for the use of principal media.Final approval should be centralized with a single,senior-level person to coordinate the companys total ongoing investments in principal media.That could be the head of media(if senior enough)or the CMO.Approvals should be done for each purchase in advance via a separate document or process.Blanket approvals or approvals of an overall media plan,PO,or flowchart should not serve as legitimate approval for principal media,even if they contain a footnote or other language stating that principal or inventory media may be included.7.Require that principal media be clearly identified on media flowcharts.Do not accept vague language such as,“Principal media may be included.”Require specifics.In addition to visibility on media flowcharts,principal media(amounts and vendors)should be clearly outlined in monthly media estimate/authorization forms.8.If your company is open to principal media,consider having a cap that is,it will be no more than X percent of the total budget for a specific period of time.9.Keep track of your companys allocation to principal media,both the dollar amount and per-centage of overall media spending.At least quarterly,require the agency to report how much principal media is being purchased.Every new deal should include the percentage of the overall advertiser spending for the current year that has been committed to principal media.10.Except for not disclosing the price the agency paid to acquire the principal media,reporting by the agency should be provided with the same level of granularity as would be expected for agent-based transactions.Proof of performance metrics and access to transaction data should be made available for principal media with the same level of detail expected for agent-based buys.Those could include(but are not limited to)impressions,CPMs,specific outcomes,viewability,and IVT.VII.GUIDELINES FOR THE USE OF PRINCIPAL MEDIA33|The Acceleration of Principal Media11.Auditing of principal media transactions should be allowed in the same way as for regular agent-based transactions.The only difference is that the agency would only provide access to the costs charged by the agency(or its affiliate as applicable)to the advertiser instead of the costs paid to third-party vendors.Agencies should provide audit data in the same format and with the same resolution as they currently do for agent-based transactions.Pricing of principal media should be provided on a detailed basis,not just as an overall total.When acting as a vendor,the agency should be required to have the same level of disclosure and oversight as any other vendor involved in the media buying process.12.Consider whether commissions or fees that would normally be paid to the agency for the management of agent-based transactions should or should not apply to principal media buys.Keep in mind that the agency will be making a profit through markups on these purchases.13.Understand the impact that principal media would have on rebates that otherwise would have been earned under a non-principal media buy.Ask the agency to disclose if this inventory comes from rebates or bonuses that you or other advertisers should have received as part of agent-based buys.With a principal media buy,return of rebates(assuming they were not earned via a previous agency-based buy)by the agency to the advertiser would typically be forfeited.14.Dont allow the savings generated by principal media to be automatically reinvested into buying more media.Ask to buy to goals and set a reserve account with your savings.Have the agency propose how to reinvest any savings.Alternatively,return cash savings to the bottom line,if needed to meet business goals.15.When running media agency pitches,any pricing guarantees provided by the agency should be based only on agent-based transactions.If this is not required explicitly at the time of the pitch,advertisers may later find out that the agency selected will only deliver against guarantees if principal buying is allowed at the agencys discretion,essentially requiring a blanket opt-in from the advertiser.VII.GUIDELINES FOR THE USE OF PRINCIPAL MEDIA34|The Acceleration of Principal MediaVIII.THE MEDIA AUDITOR PERSPECTIVEFor many ANA members,media is the largest line item in the marketing budget.Media auditing has become a regular practice because media has become increasing complex.Media audits help marketers improve efficiencies and effectiveness through increased governance and implementation of best practices.This section provides the opportunity for two media auditors to provide their respective independent perspectives on principal media.35|The Acceleration of Principal MediaVIII.THE MEDIA AUDITOR PERSPECTIVEPerspective from Cortex Media:Reality Check on Inventory MediaSo,how do we really feel about inventory buys(also known as principal media buys)?Let me get it off my chest:we are not fans of the inventory media model.Its fraught with conflicts of interest,the model is not transparent nor fully auditable,and the potential savings may not be there in the long term.So,what should you do if your company decides to engage in inventory buys?Learn how these transactions actually work.Talk to a reputable media auditor and have them explain what happens behind the curtain.Ask your agency where the inventory came from and how its really procured and paid for or not.Follow best practices from approvals through auditing.While these transactions may appear to offer short-term savings,no rational media vendor is going to lose money overall so that agencies can make more.For this to work,it must be a win-win for vendors and agencies.If both make more money,who pays?Also,what is the effect of inventory buying on overall market pricing?Is this model partly responsible for some of the media inflation we have experienced recently?Im unsure about this last point,but it makes me pause.There may be opportunities where a vendor sacrifices pricing for higher volumes or can offer a good deal if the media is prepaid.The reality is that agencies dont have the working capital to prepay more than a small percentage of these buys,and the inventory is mostly purchased and paid for only when its sold to a client.There are some opportunities worth considering in the short term,but advertisers also need to consider the long-term impact(i.e.,possibility of increased pricing).The horse is out of the barn now.Most of our clients engage in inventory buys,even if only on a limited basis.If you go down this path,do it right,and go in with your eyes wide open!Manuel Reyes,Founder,Cortex Media36|The Acceleration of Principal MediaVIII.THE MEDIA AUDITOR PERSPECTIVEPerspective from Media Marketing Compliance:A Point of View on Principal MediaAt Media Marketing Compliance,we believe that it is up to advertisers to decide whether to allow their media agencies to resell media to them at an undisclosed markup.We strongly advocate that advertisers be fully aware of the reality of what they are buying.Too often this is not the case.Our audits routinely show that the client was not completely informed of the terms of the proposed principal-based deal or the agency did not follow the terms of the MSA,leading to ineffective advertising and a reduction in trust.How did we get here?There has been a significant rise in the non-transparent revenues often undisclosed and routinely hidden that media agencies receive as a result of their work for advertisers.Despite much improvement in client/agency MSAs,our data shows that increased obligations do not necessarily result in improved transparency.Non-transparent revenues have changed following studies such as the ANAs Media Transpar-ency report in 2016,as the media agency buying groups identified new ways of generating revenue.Principal-based trading is one of these non-transparent practices,but it is positioned as being transparent because it is declared openly that agencies make a bigger margin by trading on their own accounts.Agencies negotiating better pricing for their own deals is a conflict with their client fiduciary obligations under their client MSA.Agencies buy media at a wholesale price and re-sell it to their clients at a markup(which is undisclosed and not fully auditable).To some advertisers,this may seem attractive.If we can get the media we would have bought anyway at a lower price,why not?And if the agency makes a better margin,were all better off,arent we?And if you dont like the idea of it,thats your choice,but you will lose out on getting the media you want at a better price.Its potentially a compelling argument,but the reality is another matter.Principal-based media is potentially an unlimited source of conflicts of interest.If media agencies truly commit to buy media inventory up front,this media cannot be right for all their clients.Media vendors do not sell premium inventory at a highly discounted rate on this basis.The media inventory involved in bulk buying is likely to be long-tail,lower-value time and space that the media vendors choose to sell in bulk because it is easier to offload.It is unlikely to be media that an advertiser would normally choose to buy,whatever the price.But if the media agencies really have committed to it,they have to resell it to their clients.37|The Acceleration of Principal MediaAgencies are also achieving pitch-price guarantees through delivering principal-based media.They either dont declare this through the pitch process,or if they do disclose the use of principal-based trading,it is often missed by clients in the turmoil of converting the pitch promises into a contractually binding agreement.Sometimes,post-pitch,the agencies will also state a change in strategy is required to deliver the pitch-price guarantees and therefore use principal-based media to hit the price.This also helps the agency achieve the contractual bonus paid by the client.Over the last few years,traditional cash rebates have been replaced by free space given by the vendors to the agency buying groups.This inevitably ends up within the“pot”that is used to deliver proprietary media.Of course,this cannot be confirmed,because the agency requires clients to waive their negotiated MSA audit rights.We regularly find that this lack of transparency is compounded by situations where principal-based media has been used without the appropriate authority and usually without robust justification.It is imperative that clients have clear remedial actions in their contracts if principal-based media has been sold without appropriate authorization.Media agencies are adept at positioning principal media as a benefit,so we strongly recom-mend you ask the tough questions beforehand and require the agency to verify the benefits immediately after a campaign ends.It is only an advantage if the media in question is precisely the same as you would have bought anyway,but at lower cost.That is rarely the case.Stephen Broderick,Managing Partner,Media Marketing ComplianceVIII.THE MEDIA AUDITOR PERSPECTIVEPerspective from Media Marketing Compliance:A Point of View on Principal Media38|The Acceleration of Principal MediaAPPENDIX39|The Acceleration of Principal MediaAPPENDIXANA Master Media Buying Services Template Non-Transparent Services9.Non-Transparent Services.9.1 Non-Transparent Services are not permitted without(i)meeting the requirements of this Section and(ii)obtaining prior written approval from Advertisers Chief Marketing Officer and Head of Marketing Procurement for each specific Non-Transparent Service in each instance.Approval(if any)shall be documented in a mutually agreed formaton the applicable MAF or other method as the Parties may agree to ensure that Advertiser fully understands when,where and how the NonTransparent Services being offered and delivered.9.2 The following proof of performance and other metrics shall be available for all Non-Transparent Services IVT,Viewability Standards,Brand Suitability Standards,other quality metrics,clicks,impressions,Outcomes,etc.9.3 If Non-Transparent Services include any additional terms and conditions(e.g.,license terms,loss of audit rights,loss of or change in data rights,etc.)which are not set forth in this Agree-ment,other than cost or cancellation rights,such terms and conditions must also be provided to Advertisers Legal Department and Head of Marketing Procurement for review and approval prior to Advertiser agreeing to the Non-Transparent Service.9.4 Without limiting any other provision of this Section,the approval request for Non-Transparent Services must meet the following requirements:9.4.1 specifically and clearly identify the Non-Transparent Services as“Non-Transparent Services”or Insert Other Terminology which Agency uses to identify NTS.Use of the names of Agency or its Affiliate or Related Party branded Media suppliers or their products or services alone shall not be permitted;9.4.2 include a description of the nature of the Non-Transparent Service and what it entails (e.g.is it Inventory Media,data,etc.),including whether it operates through an Agency Affiliate or Related Party;9.4.3 include a description of what benefit(s)shall be delivered to Advertiser as a result of the Non-Transparent Services and whether there are Rebates and Incentives that the Advertiser that it would have otherwise earned but would be giving up if it chooses to purchase the Non-Transparent Service;9.4.4 include timing for the authorized Non-Transparent Service spend,aggregate cost,Media type,impressions and other measurements and details and KPIs used for other Media purchases and services or otherwise requested by Advertiser;40|The Acceleration of Principal Media9.4.5 include a clear indication,in each case,of the maximum aggregate cost of the NonTransparent Service to Advertiser as a proportion of each Non-Transparent Services Media type in the aggregate;9.4.6 include a description of what transparent Media Placement options were explored by Agency and whether such purchases would entitle Advertiser to Rebates and Incentives and the rationale for why the Non-Transparent Service is the better option;9.4.7 include the percentage of overall Advertiser spend for the current Year that is currently committed to Non-Transparent Services,if the current proposal is approved by Advertiser;and 9.4.8 include any applicable cancellation charges,data,record access,or other limitations associated with the Non-Transparent Services which might differ from the rights Advertiser has under the Agreement with respect to transparently purchased products or services.9.5 Agency shall deliver a written monthly report no later than fourteen(14)days from the end of the relevant month setting out the total amounts paid by or invoiced to Advertiser for Non-Transparent Services,by Media channel,delivered to or on behalf of Advertiser during the relevant reporting period.9.6 The payment terms for invoices for Non-Transparent Services shall be the same as those set out in Section 17 for Third Party Costs,unless agreed in writing by Advertisers Head of Marketing Procurement.9.7 In the event Non-Transparent Services are purchased without authorization in accordance with this Section,Advertiser(i)shall not be required to pay for such Non-Transparent Services or(ii)such services/purchases shall be treated as all other fully transparent services/purchases are treated under this Agreement and any limitations,including on audit rights,data access,Record limitations,and Rebates and Incentives shall be void and Advertiser shall only pay the lesser of the(a)Net Media Cost for such Non-Transparent Service(as may be confirmed by Advertisers Auditor if it so chooses)or(b)the amount approved by the applicable Non-Transparent Service.9.8 Unless otherwise agreed upon by Advertiser in writing,Non-Transparent Services shall not count towards any Agency KPIs,buying commitment or performance based remuneration.9.9 Agency represents and warrants to Advertiser:(i)its recommendations for Non-Transparent Services,if any,are consistent with Advertisers Media strategy,objectives,Goals and Media buying guidelines and is in the best interest of Advertiser;(ii)any Non-Transparent Services purchases made by any Agency Group member are made in such a manner that there is material risk to Agency or the applicable Agency Group member associated with the transaction and such risk is not materially limited or effectively eliminated by a transaction or series of APPENDIXANA Master Media Buying Services Template Non-Transparent Services41|The Acceleration of Principal MediaAPPENDIXANA Master Media Buying Services Template Non-Transparent Servicestransactions by Agency Group members that rely upon subsequent payments by Advertiser or its Affiliates in excess of the compensation to which Agency or its Affiliate is entitled to receive;and(iii)purchasing Non-Transparent Services shall not cost Advertiser more than Advertiser would have had to incur under a traditional buying or service purchasing scenario that was disclosed,unless the price differential is expressly disclosed and agreed upon by Advertiser.This section is entirely new and replaces concepts from Version 2.0 relating to Principal or Inventory Sale and Principal or Inventory Mark-Up.One complaint that ANA has heard from members about Non-Transparent Services is that they agreed to Non-Transparent Services without realizing what they were agreeing to or that the true nature of the Non-Transparent Service was not understood.The use of Non-Transparent Services are a commercial item which Advertisers may choose to allow or prohibit.Regardless,Advertisers should consider having a detailed process for approving or not approving Non-Transparent Services.While many Advertisers take the position that they do not want the Agency to offer Non-Transparent Services,if the topic is not addressed in the General Terms at all,then it is likely to end up as a line item on a SOW or Media Plan or as part of a separate“opt-in”agreement without those knowledgeable of the practices knowing about it.The full contract template is here.42|The Acceleration of Principal MediaClient/agency contracts are the first place to start to ensure that the parties to the contract are on the same page about relationship expectations.When it comes to principal media(non-transparent services),it is important to understand the type of principal media offered by the agency and address the operational and approval practices in your agency contract,even if your company does not intend to use principal media.Failure to directly address principal media in the contract can lead to clients“opting in”to principal media without really knowing or understanding what they opted in to or the potential business ramifications of doing so.For instance,the client could sign a media authorization form with small print that says that the media may contain principal media,thereby giving the agency the ability to decide on its own when principal media would be best to purchase which is likely when it also benefits the agency the most without consulting the client.While the ANA Master Media Buying Services Agreement Template Version 3.0 provides some sample language to address principal media,this section should be bespoked to fit your organizational needs,risk tolerances,type of contract(i.e.,territory-specific or global),and ways of operating,as should be the approach when using any contract template.Once the contract terms are agreed upon,the approval process needs to be operationalized on both sides and audited for compliance(either internally or with an outside auditor)on an annual basis.Failure to comply with the process should have express pre-identified contractual remedies.It is important to note that one size does not fit all for principal media.Every agency holding company offers different principal media services and markets them with a different name and different benefits,and the offering are constantly evolving.Dont let yourself get confused by the different offerings.Clients should have someone at their company who is knowledgeable about principal media services(or consult with an outside resource,whether legal,auditing,or an industry consultant)and who knows the types of questions to ask to ensure the business really understands the risks and rewards of using principal media and how the agency was able to secure such an offering.Finally,all too often principal media comes into play as part of agency pitches,especially when clients are asking for pricing guarantees.Although the MSA being negotiated at the time of the pitch may clearly provide for an approval process for authorizing principal media,the commercial aspects of the pitch are not always tied closely to the contract terms.It is not unusual to have commercial teams choose an agency that included a principal media requirement in their pitch proposal to meet pricing commitments without realizing what that requirement meant,and by the time the team realizes it,it is too late.Clients should ask to understand the agencys principal media offerings as part of the pitch process and ensure that principal media is not included as part of pricing proposals and commitments.Keri Bruce,Partner,Reed Smith,LLPAPPENDIXPerspective from Reed Smith:Client/Agency ContractsANA Master Media Buying Services Template Non-Transparent Services43|The Acceleration of Principal MediaAPPENDIXAbout the Survey Respondents2#E%5%0%Associate or assistant managerBrand or product managerDirectorEVP,SVP,VPCMOCEO/PresidentJob LevelBase:83Q.What is your job level?(Please select the best fit.)4%6%6%5%5%3%5%Dont know/Not sure$1 billion or more$500 million to$1 billion$200 million to$500 million$100 million to$200 million$50 million to$100 million$30 million to$50 million$15 million to$30 million$5 million to$15 million$1 million to$5 million$1 millionU.S.Media BudgetBase:81Q.Which of the following best describes your organizations 2023 total annual U.S.media budget?44|The Acceleration of Principal MediaAPPENDIXAbout the Survey RespondentsB-to-B8%B-to-C64%Both28%Type of BusinessBase:84Q.Is your primary business B-to-B or B-to-C?45|The Acceleration of Principal MediaAPPENDIXAcknowledgementsThe ANA would like to acknowledge the following contributors to this report.ANA Media&Measurement Leadership Council MembersWe appreciate the input from members of the ANA Media&Measurement Leadership Council(MMLC).The MMLC is an activist group of brand advertisers chief media and research officers,who are ultimately responsible for the effective deployment of media expenditures as well as the measurement and analytics to support those investments.The MMLC is grounded in the advancement of outcomes,bringing together the collective voice,muscle,and will of the advertisers media and measurement communities to address industry barriers and shared issues that inhibit business and brand growth.The mission of the MMLC is to set the industry media agenda by identifying and solving pressing and important initiatives that unlock increased value for advertisers to accelerate business and brand growth.Legal Keri Bruce,Partner,Reed Smith,LLPAuditing Stephen Broderick,Managing Partner,Media Marketing Compliance Rick Gonzalez,Media and Advertising Assurance Services Leader,PwC US Manuel Reyes,Founder,Cortex MediaANA Bill Duggan,Group EVP Jason Trubowicz,SVP Amy Zeng,Manager,Creative Services46|The Acceleration of Principal MediaThe mission of the ANA(Association of National Advertisers)is to drive growth for marketing professionals,brands and businesses,the industry,and humanity.The ANA serves the marketing needs of 20,000 brands by leveraging the 12-point ANA Growth Agenda,which has been endorsed by the Global CMO Growth Council.The ANAs membership consists of U.S.and international companies,including client-side marketers,nonprofits,fundraisers,and marketing solutions providers(data science and technology companies,ad agencies,publishers,media companies,suppliers,and vendors).The ANA creates Marketing Growth Champions by serving,educating,and advocating for more than 50,000 industry members that collectively invest more than$400 billion in marketing and advertising annually.ABOUT THE ANA47|The Acceleration of Principal MediaWhat Marketers Need to KnowMAY 2024The Acceleration of Principal M
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State of Product MarketingPerspectives from practitioners at various stages of their product marketing journey2024 Report2024 Report2State of Product MarketingWelcome to the sixth-yes,you heard that right,sixth-edition of the State of Product Marketing Report.As always,were digging far beyond the surface to unearth the deep,gritty secrets that drive success at every level from fledgling startups finding their footing to established titans steering the corporate ship.Through a blend of qualitative anecdotes and quantitative data,were bringing you the voices of those who live and breathe product marketing.From the passionate Associate Product Marketing Managers eager to make their mark,to the visionary VPs of Product Marketing who have weathered every storm,this expos promises to be an eye-opening exploration of the diverse journeys within our industry.Introduction2024 Report3State of Product Marketing4514162227313642Key findingsWho took partHow has product marketing changed since 2023Roles,responsibilities,team infrastructureCompany focus and external collaborationKPIs and budgetingProduct marketing highlights and challengesProduct marketing skills,tools,and career aspirations#1 product marketing top tipsContents2024 Report|State of Product MarketingKey findingsDont have time to read the whole thing?Dont worry,weve got you covered.Nearly 80%of PMMs come from smaller teams(1-5 people).20%of PMMs work at companies with a 1:3 product marketing to product management ratio.Product positioning and messaging continues to hold its position as the top product marketing responsibility.11.9%of product marketers dont track KPIs within their role.A staggering 35.6%of participants dont have a dedicated product marketing budget.65.6%of product marketers are invited to leadership meetings,and only 66.3el supported by their leadership team.5.9%of product marketers wish to change their career and company entirely.2024 Report5State of Product MarketingTo really get a handle on the product marketing arena,we went straight to the source-tapping into the collective wisdom of industry experts from all corners of the globe.Our survey captured insights from professionals wearing different hats and working the full spectrum of sectors.From burgeoning startups to corporate juggernauts,our respondents brought a diverse range of perspectives to the tableWho took part62024 Report|State of Product MarketingJob titleWe wanted a wide range of perspectives from the entire product marketing hierarchy and we werent disappointed.We gained insights from Heads of Product Marketing(4.3%),Directors of Product Marketing(11.6%),and Senior Product Marketing Specialists(7.2%).Naturally,our Product Marketing Managers took the lead at 44%,with Senior PMMs taking second place at 17.3%.VP of Product MarketingHead of Product MarketingSenior Director of Product MarketingDirector of Product MarketingSenior Product Marketing ManagerProduct Marketing ManagerSenior Product Marketing SpecialistAssociate Product Marketing ManagerMarketing Manager1.1%4.3%1.1.6.3D%7.2%1.8%1.1%The rest of our respondents were titled under different product marketing/marketing roles.Its safe to say that we cast a wide net over the marketing industry,pulling insights from titles such as:Technical Product Manager Product Marketing ExecutiveChief Marketing OfficerTrade Marketing ManagerStrategic Software Marketing ManagerSenior Technical Marketing EngineerSenior Product Marketing AnalystProduct Growth ManagerInternational Product Marketing EngineerGrowth MarketerGo-to-Market Manager72024 Report|State of Product MarketingLocationOur respondents were based all around the world,but the majority were in the following top 10 countries.United States47.8nada5.8%UnitedKingdom4%France3.6%Spain1.5%India4%Singapore1.5%Germany3.3%Poland1.1%Netherlands2.5024 Report|State of Product MarketingBreaking it down further,we found that our US majority took the lead over our top cities London10.6%New York4.7%Atlanta2.6nver2.2%Vancouver1.8%Seattle1.8%San Francisco2.2%Austin2.9%Boston3.6%Paris2.2%Amsterdam1.8024 Report|State of Product MarketingAnd,of course,we couldnt not add in our top states California13.6%Texas10.6%New York9.9%Washington6.1%Colorado5.3%Illinois3.8%Pennsylvania3.3%Washington DC2.3%Virginia2.3%Massachusetts 8.3%Georgia 6.12024 Report|State of Product MarketingCustomer typesWe wanted to understand what types of customers product marketers are serving at their companies.The majority of people we spoke with said they market to a B2B customer base(75.6%),with 17.8%indicating that they cater to both B2B and B2C audiences,while 4.4%only cater to B2C.In only 1.5%of cases,respondents worked in B2D.Customer typeB2B75.6B&B2C17.8C4.4D1.5%Other0.7%How do you,as a product marketer,directly engage and communicate with customers?“Engaging with customers is an integral part of product marketing.Understanding customer pain points and how the product can solve them is the only way to develop messaging that resonates.One of my favorite ways to get this information is through win/loss interviews.“Document the process and get the sales team in the habit of asking customers to speak with you right after a deal closes.These interviews taught me valuable insights about competitors and why they chose our product.“Other ways to engage with customers include participating in beta trials to gather product feedback,writing and sharing product updates in marketing emails,and meeting face-to-face at events.Staying on the same page as customers helps drive feature adoption and improve the sales process.Plus,building relationships with your customers makes it easier to ask for their participation in marketing projects later.”Aphrodite Brinsmead,Director of Product Marketing at Duro112024 Report|State of Product MarketingProduct typesOur survey explored the types of products that the participants marketed.The majority,representing 79.1%,focused on Software as a Service(SaaS)or other digital products.A smaller segment,6.6%,exclusively marketed physical products.Notably,12.5%of the respondents dealt with both physical and digital offerings.The remaining 1.8ll into the“Other”category,suggesting they marketed products or services beyond the specified options.These could be a number of possibilities,including subscriptions,creative works,events/experiences,and so on.IndustryOur findings this year revealed a diverse array of industries employing product marketing professionals.Leading the pack was the Computer Software industry,engaging nearly a quarter(23.7%)of the respondents.Closely following suit were those in the Information Technology&Services sector,representing 16.7%of the product marketers surveyed.N.B.As our collection of industries was so diverse,we have only selected the top 10 industries chosen by our participants.SaaS/digital productsBothPhysical productsOtherComputer SoftwareInformation Technology&ServicesFinancial ServicesMarketing&AdvertisingHospital&Health CareTelecommunicationsHuman ResourcesLogistics&Supply ChainMarket ResearchInternet79.1.5%6.6%1.8#.7.7%6.7%3.7%3.3%2.2%2.2%1.9%1.5%1.52024 Report|State of Product MarketingEarly pre-product market fit6.6 23202417.91.8%.8.9%6.9.3).9.60.3rly post-product market fitMid-growth with established go-to-market teamLate growth/scale upWell established/market-leaderState of growthOur dive into the growth stage of the participants companies revealed that a sizable 30.3%were associated with well-established market leaders.This figure marked a notable increase from last years 17.9%,suggesting a growing representation of product marketers at mature organizations.Closely trailing this group were those employed by mid-growth companies with an established go-to-market team,accounting for 29.9%of the respondents.132024 Report|State of Product MarketingCompany cultureWhile sales-first and product-first companies continue to lead the pack,our findings show a slight decline in their representation compared to last years results.However,we witnessed an uptick in respondents hailing from customer-first and marketing-first organizations,with respective increases of 6.4%and 3.6%.Total experience as a product marketerOur research benefited from a large sample size,comprising product marketers with various levels of experience within the field.Nearly half of the respondents,47.7%,have honed their craft as product marketers for a span of 2 to 5 years,representing a significant group of mid-career professionals.The remaining participants were distributed across the spectrum,with 9.8ing relatively new to the profession,having a year or less under their belts.Remarkably,a seasoned 3.6%have accumulated an impressive tenure exceeding two decades in product marketing!Company culture20242023 /-Sales first37.07.1%0.1%Product first31.26.4%5.26%Customer first25.6.2%6.44%Marketing first6.2%2.6%3.63%OtherN/A4.7%N/A00.7%9.5.2.2.9%7.6%4.7%6.1%1.6%9%0.4%0.4%0.4%0.4%3.6%0.7%3.3%1.8%2.5%8%03456789101112131415161718 20 Years of Experience142024 Report|State of Product MarketingWhile were diving into the hard numbers and comparing this years data to last years,we also wanted to get into the more subjective,human perspectives.We asked our product marketing folks to share their personal take on any changes theyve seen happening in the industry.Heres what they had to say.“Over the past year,product marketing has undergone significant transformations,primarily driven by the advent of generative AI(GenAI)technology.This innovation has greatly enhanced the productivity of product marketers by streamlining many of their routine tasks.“While the fundamental aspects of product marketing such as conducting thorough research,engaging with customers,and developing a deep understanding of the product remain crucial,GenAI has revolutionized how these tasks are performed.“For instance,it assists in efficiently conducting secondary research by summarizing extensive reports and enriching content based on core messaging,thus facilitating quicker article editing.“This shift has allowed product marketers to allocate more time to the core elements of their role:deeply understanding the market,crafting compelling narratives,and developing and executing impactful go-to-market(GTM)strategies.”“I think were finally seeing the merger of brand and product in marketing campaigns.Especially in freemium models,where competition is huge,brands are going to take a key role in helping PMM achieve their targets.“The times where you could have a brand in social and a completely different brand in ads or in-app are finally coming to an end,and were seeing some major powerbrands,like Notion,doing OOH in a way that they wouldnt have a couple of years ago.Also,everyone should check out NotCo and what theyre doing in terms of marketing,even though its a DTC(direct to consumer)brand.”Steffi Li,Director of Product Marketing at ZillizIgnacio Duarte,Head of Marketing at SimpliRouteHow has product marketing changed since 2023?152024 Report|State of Product Marketing“The advent of Large Language Models(LLMs)brought a wave of“AI-powered innovation”into most markets,which in turn meant companies started announcing the same new capabilities over and over again.“In 2024 it feels like you cant have a product without AI,yet most AI features look the same to the competition.Wheres the strategy,wheres the differentiation between competitors?“Im not saying you should not launch something useful just because your competition already has it.But companies with great product marketing need to step up and take risks.Foster cross-functional collaboration among teams to develop something truly useful for your customers,taking advantage of both market and technology knowledge working in unison to identify the right niche and use case to leap forward and ensure you become the one getting copied.”“The B2B SaaS recession of the 2022/2023 changed how companies buy software.If youre not seen as a must-have product,growth will be much more difficult compared to pre-covid times when businesses were more likely to take a chance on nice-to-have products.As product marketers,were iterating on our positioning more often than ever to be in the must-have camp.”Christopher Greco,Product Marketing Lead at TolokaBrian Dreyer,VP of Product Management at SightCall162024 Report|State of Product MarketingRoles,responsibilities,team infrastructureWho do product marketers report to?In terms of product marketing reporting structures,its a bit of a mixed bag.The Director of Product Marketing takes the lead as the most common boss,with 19.5%of our respondents reporting to them.Then comes the VP of Product Marketing at 10.5%,showing that many companies have their own dedicated product marketing teams and hierarchies.However,about 9.8%of respondents report directly to the Chief Marketing Officer,hinting that product marketing sometimes falls under the broader marketing umbrella.And heres where it gets interesting:9.4%report to the VP of Marketing,while 7.2%report to the Head of Marketing,emphasizing how closely tied product marketing can be to the overall marketing function in certain setups.5.8%of product marketers are reporting directly to the CEO.This could be more common in startups or smaller companies where product marketing plays a major strategic role.And lets not forget the 2.5%who report to the Chief Product Officer(CPO),showing that collaboration between product marketing and product management is happening in some cases.Essentially,these varied reporting lines paint a picture of the multifaceted nature of product marketing.It seems that its all about seamlessly blending with marketing,product management,and executive leadership across different company structures and priorities.172024 Report|State of Product Marketing10.5%-VP of Product Marketing2.5%-CPO7.6%-Product Marketing Manager19.5%-Director of Product Marketing2.5%-Senior VP of Marketing7.2%-Head of Marketing5.8%-CEO9.4%-VP of Marketing1.1%-Myself1.1%-CCO4.3%-Head of Product Marketing9.8%-Chief Marketing Officer1.4%-Director of Marketing1.1%-General Manager5.1%-Sr.Director of Product MarketingOthers stated they directly report to:Marketing ManagerGo-to-MarketCROCOOVP,Product ManagementVP of Customer ExperienceSVP of MarketingSenior Product Marketing ManagerSenior Marketing ManagerWho do product marketers directly report to?182024 Report|State of Product MarketingProduct marketing team sizeWe then wanted to learn more about team sizes.The prevalence of small teams(1-2 members)and moderate teams(3-5 members),accounting for nearly 80%of the responses,suggests that many companies may still be in the early stages of building out their product marketing capabilities.However,the existence of larger teams indicates that some organizations have recognized the strategic value of robust product marketing efforts and have invested accordingly.As companies continue to prioritize go-to-market(GTM)strategies,product differentiation,and customer engagement,the demand for larger and more specialized product marketing teams could increase in the coming years.1-2 People-47.5%3-5 People-31.2%6-10 People-12.6 People-8.7%How many people are part of each product marketing team?192024 Report|State of Product MarketingProduct marketing team structureWhich teams do product marketers work with the most?Our data shows that PMMs work most closely with the product team(19.4%)and the marketing team(18.4%),reflecting the core responsibilities of product marketing in bridging the gap between product development and go-to-market strategies.PMMs also work extensively with the sales team(16.3%)and the customer success team(10.8%),highlighting their crucial role in enabling and supporting these customer-facing functions.This all underscores the pivotal purpose of product marketing in bridging various teams and functions within an organization.“Im really surprised that more PMMs arent working closely with sales enablement.Thats a missed opportunity to partner with another equally important key stakeholder,especially considering the need to enable internal staff,customers and the market on what value the business and solution provides.”Sarah Spinosa,Senior Product Marketing Manager at Higher LogicWhich teams do product marketing work with most?2024Product19.4%Marketing18.4%Sales16.3%Leadership10.8%Customer success10.7%Sales enablement9.4%Business development8.1%Engineering6%Other0.9 2024 Report|State of Product MarketingPMM:PM ratioWe then wanted to understand what companies prioritize when it comes to product marketing versus product management.The most common ratio we found is one Product Marketing Manager for every three Product Managers,with 20%of respondents reporting this ratio.It seems that in many companies,product marketing teams are relatively lean compared to product management teams,potentially due to resource constraints or organizational priorities.Interestingly,1.2%of respondents stated that they were both a product manager and product marketer at their company.Being two separate functions with different responsibilities,it raises the question again about a lack of resources.As product marketing continues to gain recognition as a strategic function,organizations may reevaluate these ratios to ensure they have the right balance of resources to support both product development and effective go-to-market execution.1:02.3.9.1 .1.8%4.2%3.5%2.3%4.2%2.7%1.2%1:11:21:31:41:51:61:71:81:103:1I am bothOther(10.7%)ratios include:2:44:23:63:53:102:52:202:212:41:100Current Product Marketing Manager to Product Manager ratio212024 Report|State of Product MarketingMain product marketing responsibilitiesAs we dug into the main responsibilities of our product marketing participants,some intriguing patterns surfaced.Product positioning and messaging continued to hold its position as the top responsibility,standing firm at 90.6%in 2024,showing a slight increase from 90.1%in 2023.This steady demand reaffirms its enduring importance in product marketing.However,there were noticeable shifts elsewhere.Managing product launches experienced a decline from 86.8%in 2023 to 78.7%in 2024,hinting at a potential shift towards more continuous product updates or a heightened focus on alternative aspects of the role.Similarly,the tasks of creating sales collateral and updating internal documents witnessed a decrease from 80.8%in 2023 to 75.5%in 2024.This adjustment could reflect efforts to streamline processes or leverage technology for more efficient content management practices.N.B.Participants could select more than one option for this question.Managing product launchesProduct roadmap planningSales enablementProduct positioning and messagingReporting on product marketing successStorytellingCompetitive intelligenceCustomer and market researchOnboarding customers(e.g.onboarding emails,webinars,etc.)Customer segmentationOtherContent marketing(e.g.blog posts,articles,eBooks,reports,webinars,etc.)Creating sales collateral and updating internal documentsBuilding personasCustomer marketing and advocacyManaging the website and customer-facing documents2023202490.1.8.8f.9X.9X.3S.6U .5d.2.56.4C.6.6x.7u.5%N/A64.3VP.5I.8B.3#.1X.2.12.5C.9h.2d.6U.32024 Report|State of Product MarketingCompany focus and external collaborationAre companies more product-focused or sales-focused?We wanted to see where the company focus was for our participants.We found that a significant portion of respondents(37.2%)view their organizations as equally prioritizing both product and sales efforts.However,a slightly higher percentage(36.8%)consider their companies to be more product-focused,while 26%perceive a greater emphasis on sales initiatives.This distribution suggests that many organizations strive to strike a balance between product development and sales execution,but theres also a slight trend toward product-centric approaches,potentially driven by factors like innovation,customer experience,and differentiation in competitive markets.SalesProductBoth266.87.2#2024 Report|State of Product MarketingHow many products do product marketers support?A significant portion(23.9%)of our product marketers support a single product,which could indicate a focused approach or a smaller product portfolio.However,27.6%support six or more products,highlighting the need for effective product marketing strategies across extensive product lines.We also found that a considerable number of teams supported two(18.3%),three(12.9%),and four(11.8%)products,suggesting that managing multiple products is a common scenario amongst our product marketers.Essentially,the distribution of product support responsibilities pinpoints the wide range of challenges that product marketing teams are currently facing.While some teams can concentrate their efforts on a single product,others must navigate the complexities of managing messaging,positioning,and go-to-market strategies for multiple offerings simultaneously.This highlights the significance of scalable product marketing processes,efficient resource allocation,and cross-functional collaboration to effectively support varying product portfolios.Number of products product marketers support23.98.3!2.911.8E.5R7.6%6 “I had to look twice at the data!I was surprised to see a similar percentage of product marketers supporting just one product and then supporting 6 products.Theres a significant difference in the scope of work to support 1 versus 6 products,yet we see a similar percentage of product marketers on each side.“This tells me that a fair number of organizations are getting it incredibly right(allowing product marketers to focus on and grow a single product)or potentially,incredibly wrong(stretching a product marketers bandwidth across so many products they cant fully support each one at a deep level).“That being said,a product marketers ability to support a certain amount of products is in some way driven by the product marketing charter within that organization,and also the product life cycle.So to put it simply,its nuanced.”Hannah Pickering,Senior Product Marketing Manager at HealthEquity242024 Report|State of Product Marketing“We have two very important leadership groups:PMM and Enablement.“Our PMM Leadership group is made up of Our VP of Product,VP of Marketing,Director of UX,and myself(Senior PMM.)We discuss as a group anything related to product strategy,GTM strategy,and overall vision and direction.It enables us to make decisions as a group and ensure that were aligned about what is happening and why.“We meet on a weekly basis,so were always communicating!I also work individually with each of the product managers and get involved early and often,and we discuss progress on their own streams on a continuous basis.“Our Enablement team is made up of our Sr.Solutions Manager,our Senior Enablement Manager,and myself.Like our PMM leadership group,we make sure were aligned and share thoughts and insights,and have also set up a monthly commercial check-in with all AEs to make sure they have everything they need to do their jobs and close those deals!“In general,I try to make sure I involve team members early and often,including our members of our Science team,Support team,and CS teams as well.Nobody likes to get caught by surprise!”“I partner with client marketing,product,and service to set up programs for client feedback on new product concepts or prototypes.I also reach out to account managers to set up persona interviews to hear directly from the client about what their pain points are and how our solution can solve those pain points.“When possible,I also attend user groups and tradeshows to chat with clients in person.Partnering with clients on case studies or presentations is also a great way to learn about client use cases and success stories.Getting first-hand knowledge of clients problems and potential solutions helps make you an internal subject matter expert,develop a strong go-to-market strategy,and create compelling messaging and positioning.”Andrea Saez,Senior Product Marketing Manager at UnmindEmily Wengel,Senior Product Marketing Manager at Origami RiskCollaboration with non-product marketersHow do you,as a product marketer,effectively work together with teams like sales and product development?252024 Report|State of Product Marketing“Regular communication,shared goals and projects,and two-way feedback all help to make cross-functional relationships thrive.“First off,make sure you have regular check-ins.I like to schedule weekly meetings with sales and monthly calls with customer success or product teams.Of course,its better to meet face-to-face to get to know each other,but video conversations work when thats not possible.“Use these sessions to understand your colleagues challenges and successes and provide training on customers,competitor intel,new market developments or product announcements.Collaborating on a big project,such as a product launch or an important sales presentation,is an excellent way to showcase your skills and establish the value of product marketing.“Moreover,having shared goals around revenue generation or feature adoption helps keep everyone aligned.“And finally,feedback is essential.Even if you think you have a fantastic new deck with differentiated messaging,it wont be beneficial if the sales team doesnt want to use it.So,listen to what they say,try testing the messaging with a couple of helpful people before rolling it out across the company,and find a way to meet in the middle.Progress is more important than perfection.”“Soon after starting and basically reviving the PMM function here I instituted what I called quarterly product marketing tours,where each quarter I selected one(different)individual contributor from customer-facing departments(CSMs,sales,sales engineers,etc.)to hear from them what theyre hearing.“This has served as a way to develop product feedback,validate what I hear from the market,and identify sales enablement holes among other great nuggets of information Ive collected.“Another tactic I implemented was competitive intel conversations held casually the first Friday of each month with key sales leadership stakeholders which was my opportunity to show the gaps in the Salesforce reporting(where reps werent populating who the competitors were in a deal or who we lost to)and also watch trends for emerging competitors.“This also gave them a place to share with me what they were hearing on calls.These two programs ultimately contributed to reducing lost deals to competitors by 16%and status quo by 61%YOY in 2023.”Aphrodite Brinsmead,Director of Product Marketing at DuroSarah Spinosa,Senior Product Marketing Manager at Higher Logic262024 Report|State of Product Marketing“Its easy for product marketing to become an order taking function for sales and product.One day sales asks you to“create a one-pager and a battlecard for an important prospect”and the next day,product asks you to“write a quick blog post”to announce a new feature.Pretty soon,your days are filled with one-off requests that arent actually moving the needle.“The best way to get ahead of this is for product marketing to proactively align with sales and product on shared priorities and objectives for the quarter.While product marketing will still need to carve out time for high-impact opportunities that come up throughout the quarter,this ensures product marketing is working on whats most important for the business overall.”“To work effectively with sales and product development,I think its important to prioritize communication,mutual trust,and broad-mindedness.“As a former salesperson,I have genuine empathy for the sales team-the challenges they face are often underappreciated.Salespeople have valuable insights into why customers opt for our product over competitors-those insights are worth their weight in gold!Actively listening to their perspectives and integrating their feedback into our product positioning is a productive use of their knowledge and fosters mutual trust.“Similarly,when partnering with product management teams during a new commercialization,curiosity is essential.Collaborating with the product team with an open mind and asking thoughtful questions is the most direct path to uncovering the products authentic positioning.Frequent communication is also vital,as the technology landscape changes quickly and frequently.“Lastly,expressing appreciation for the challenges and efforts of both teams reinforces a culture of mutual respect and collaboration.Building and selling products in a crowded landscape is challenging,and everyone appreciates when thats acknowledged.”Andy Schumeister,Head of Product Marketing at MutinyCasey OhashiSenior Product Marketing Manager at TripleLift272024 Report|State of Product MarketingKey performance indicators and budgetingProduct marketing KPIsWe then wanted to understand how key performance indicators(KPIs)had changed in the last year in product marketing.Generating new revenue remained a top KPI for our product marketing respondents,with a slight increase of 1.2%from 49.7%in 2023 to 50.9%in 2024 reinforcing product marketings important contribution to revenue growth.The emphasis on go-to-market strategy witnessed a significant decrease,dropping from 60.9%in 2023 to 50.2%in 2024.This shift could signify a move toward focusing on more established products or heightened attention on alternative areas of the marketing mix.Interestingly,a fresh KPI emerged in 2024:Increased web traffic.Approximately 22%of respondents now track this metric,indicating the growing importance of digital channels and online presence in product marketing endeavors.N.B.Participants could select more than one option for this question.Company culture20232024Generate new revenue49.7P.9%Go-to-market strategy60.9P.2%Increased marketing qualified leads35.1A.9%Increased sales qualified leads25.84.7%Customer retention29.82.5%Increased win rate35.8(.1%Up-sell customers37.1.4%Cross-sell customers35.1#.8%Increased web trafficN/A22tive users24.5.9%Customer satisfaction score19.2.1%Sales confidence31.1.8%Asset utilization22.5.3%Increased trial signups17.2.4%We dont have KPIs17.2.9%Time taken to complete actions7.9%7.9%Other6.6%8.3(2024 Report|State of Product MarketingBudgetsA striking finding from our survey was that a proportion of respondents(35.6%)indicated the absence of a dedicated product marketing budget.This observation raises the possibility that product marketing activities either rely on funding from other departmental budgets or arent deemed a priority within those organizations.A considerable number of respondents have relatively small annual product marketing budgets(21.5%),ranging from$0 to$50K,with the largest group(8.2%)being in the$26K to$50K range.These smaller budgets may be more common in smaller companies or those with limited product offerings.What are the current annual product marketing budgets?$0-$10K10%$101K-$125K2.6%$11K-$25K3.3%$126K-$150K1.5%$151K-$200K2.6%$201K-$250K2.6%$251K-$500K5.3%$26K-$50K8.2%$501K-$1M4.1%$51K-$75K3.3%$76K-$100K6.7%I dont have a product marketing budget35.6%Other14.2)2024 Report|State of Product MarketingHow have product marketing budgets changed since 2023?Many respondents noted little to no change in their product marketing budgets,signaling a sustained level of investment and prioritization for these initiatives within organizations.Interestingly,close to a quarter of participants reported an increase in their product marketing budgets.This pattern implies that some companies are recognizing the strategic value of product marketing and are allocating additional resources to support endeavors.Conversely,a smaller yet noteworthy proportion mentioned a reduction in their product marketing budgets compared to the previous year.These decreases could be attributed to cost-saving measures,shifts in organizational focus,adjustments in product portfolios,or prevailing economic circumstances.Its remained the sameYes,its decreasedYes,its increased57.5.1$.402024 Report|State of Product MarketingWhere is the PMM budget spent?We then wanted to understand where these budgets were being spent.Many product marketing budgets are dedicated to software and tools(15.8%),reflecting the importance of technology in supporting product marketing efforts this year.Video creation and editing(13.7%)and conferences and networking events(13.5%)also occupy prominent positions,reinforcing the value of compelling visual content and industry presence.Paid advertising(12.2%)and written content(9.8%)are also prioritized,enabling effective outreach and engagement with target audiences.Budget also accounts for critical research initiatives,including customer research(9.3%),design resources(9.1%),and competitive analysis(7.6%),ensuring a deep understanding of market dynamics and a strong visual identity.This multi-faceted distribution of resources highlights the comprehensive approach product marketing teams take to support their campaigns,leveraging various channels,mediums,and data-driven insights to drive success.Where are the majority of product marketing budgets spent?Software and tools15.8%Video creation/editing13.7%Conferences and networking events13.5%Paid advertising12.2%Written content9.8%Customer research9.3sign9.1%Competitive research7.6%Hiring and recruitment4.1%Training/professional development2.4%Other2.612024 Report|State of Product MarketingProduct marketing challenges and leadership supportProduct marketing challengesWhat are the biggest persistent challenges PMMs still struggle with?“One of the biggest difficulties in product marketing is actually getting other stakeholders to understand what product marketing is and the value you can add.Its very important to internally educate groups on what you do as well as how you can work together.This requires proactive communication and relationship building across product,sales,and other teams.”“To me,its still getting internal marketing right.Theres a lot of pressure to get to the KPIs we need in terms of acquisition,so our main focus is always there,but internal marketing keeps coming back as something we should be very proficient at,and were not.“This is something that we as PMMs need to address as we would with an external campaign.Who is my internal audience,what does my calendar look like,do I need to have some internal influencers to help me out,what kind of content is best for this audience,etc.I still see a lot of PMMs that think that just by sending a Slack message,everything is going to be okay.”Emily Wengel,Senior Product Marketing Manager at Origami RiskIgnacio Duarte,Head of Marketing at SimpliRoute322024 Report|State of Product Marketing“A common internal communications challenge stems from being the advocate for sales,product,customers,professional services and marketing.When goals or opinions for some of these groups clash,it becomes a challenge to establish priorities for limited resources.“Product marketing needs to take multiple perspectives(and personalities)into account and consider the best short and long term interests of the business including risks and implications of their position.When a resolution is made,whether decided by consensus or mandate,all groups must accept it as the path forward.With product marketings influence across groups,departments and teams,its important to visibly show support for resolutions to bring everyone forward.”“Identifying metrics that can be owned solely by product marketing has always been a challenge.Product marketing is a cross-functional role and depending on team structure will work alongside marketing channel owners who will own the activity performance.“Uplift and optimisation is one way PMMs can show impact.How has a change in messaging increased email conversion?How has sales confidence in their product knowledge increased?Are the leads generated through a GTM campaign better quality or have a greater retention?“Measuring these uplifts or even better,attributing a revenue figure to them,helps to demonstrate the value that product marketing can bring to an organization through results that would resonate with a leadership team.”Alexander deLong,Director of Product Marketing at IsometrixCharlotte Hall,Product Marketing Manager at Pion332024 Report|State of Product Marketing“Theres a laundry list of deliverables a typical PMM is responsible for producing,including ads(digital and print),blog posts,case studies,ebooks,presentations,videos,white papers,etc.“Each of these deliverables can be touched by many people during their production lifecycle,and those touchpoints can be scattered across multiple teams,within marketing and other departments,as well as with outside vendors.Tracking a deliverables progress,ensuring each step of its development lifecycle is properly executed,and confirming handoffs between teams and individuals occurs in a timely manner is still one of the biggest persistent challenges for PMMs.“The more deliverables PMMs are expected to produce,the more daunting that challenge becomes.When you multiply each deliverables production touchpoints by the number of deliverables PMMs are committed to producing,its easy to see how things can fall through the cracks.”Guy Nadivi,Director of Marketing Excellence at ReversingLabs342024 Report|State of Product MarketingAre product marketers invited to leadership meetings?How often are our product marketers included in leadership meetings?Well,we found that a majority of product marketing teams or individuals(65.6%)are invited to participate in leadership meetings within their organizations.This suggests that product marketing is recognized as a strategic function and is given a seat at the table during important decision-making.Being invited to leadership meetings can bring several benefits including cross-functional alignment,go-to-market strategy input,building a bridge between the customer and organization,and facilitation of collaboration and communication between departments.On the other hand,the data also shows that 34.4%of product marketing teams or individuals are not invited to leadership meetings.This could be due to various reasons,such as organizational structure,company culture,or a lack of recognition for the strategic value of product marketing.“The percentage who said yes-65.6%-was encouraging.Given the cross-functional role of the Product Marketer,with our deep understanding of the industry,our customers,our products,and how they all intersect,we truly are strategic assets and bring immense value to leadership meetings.Id love to see future surveying of how effective our voices are in those meetings!Its one thing to have a seat at the table.Its another to seize the opportunity and add value.”Hannah Pickering,Senior Product Marketing Manager at HealthEquityYesNo65.64.452024 Report|State of Product MarketingYesNo65.64.4%Is there strong leadership support for product marketers?Organizations that recognize the value of product marketing,and provide strong leadership support,are better positioned to leverage PM potential in driving customer acquisition,revenue growth,and overall business success.We found that a majority(66.3%)of respondents have strong leadership support for product marketing initiatives at their companies.This is an encouraging sign,as leadership support is often crucial for the success and effectiveness of product marketing efforts.However,the data also shows that 33.7%of respondents do not receive strong leadership support at their companies.This lack of support can pose significant challenges,such as limited resources,siloed operations,and a diminished ability to drive strategic initiatives.362024 Report|State of Product MarketingProduct marketing skills,tools,and career aspirationsPMM skillsWhat skills are most valuable for PMMs to develop?“Work on your writing.All the time.PMMs do so much communicating:within our team,to other teams,with agencies,and,of course,directly with customers.Keep tightening your message,trying new ways of describing things,omitting needless words,and using the wide variety of tools that are out there for real-time feedback.(My favorites are Grammarly and Hemingway.)If budget affords,take classes,but theres still no substitute for putting in the work.”“Empathy:for your customers pain points and your sales team paint points you have the ability to greatly impact both of them!Cross collaboration skills:Any successful PMM must be able to bridge the(sometimes siloed)teams across the business and also with customers.”Jesse Friedman,Product and Brand Strategy FreelancerSarah Spinosa,Senior Product Marketing Manager at Higher Logic372024 Report|State of Product Marketing“Many companies layer PLG on top of their existing SLG go-to-market(GTM)motion.A valuable skill would be to make sure both motions are in sync with each other.You must step out of a myopic view of product marketing deliverables and look at your prospect-to-customer journey at the confluence of PLG and SLG.”Bryan Elanko,Senior Product Marketing Manager for CloudBees“You can learn hard skills related to GTM,the buyer journey,etc.But I teach my team that there are three even more important things.1.“We improve the outcomes of our colleagues,and so is the focus and scope of our work.We understand what is good enough for others to increase their performance.2.“We connect the dots and aggregate,95%of all info is available in the organization.You have to build the relationship to find and unlock it.3.“We make marketing scalable,software is scalable,so is our work.By creating best practice playbooks and templates we educate our stakeholders and elevate overall performance.”Bob.M HendriksProduct Marketing Director at Puzzel382024 Report|State of Product MarketingProduct marketing career aspirationsBut where do our product marketers want to be in their careers?40.4%aspire to stay with their current employer but move up the product marketing career ladder.Additionally,25.2%aim to change employers while remaining in the same product marketing role,potentially seeking better opportunities,work environments,or compensation packages within the field.While the majority of respondents seek growth or stability within the product marketing discipline,a smaller segment of 5.9%expressed a desire to change both their employer and role.“A whopping 40.4%of product marketers are interested in staying with the same employer,but move up the product marketing career ladder.This is encouraging for employers(youre retaining valuable talent)but it also indicates that employers must provide growth opportunities and clear career progression so that product marketers who want to move up the career ladder feel motivated to stay rather than leave in order to proceed to the next level.”Hannah Pickering,Senior Product Marketing Manager at HealthEquityStay with the same employer,but move up the product marketing career ladderChange employer,but stay within the same roleStay with the same employer,in the same rolePrefer not to sayChange employer,and change roleStay with the same employer,but move to a different department40.4%.2.3%7.8%5.9%1.592024 Report|State of Product MarketingWhat kind of tools do product marketers regularly use?We wanted to then understand what kind of tools our product marketing participants regularly use within their role.Collaboration tools are used less,seeing a significant decrease from 70.2%in 2023 to 46.5%in 2024,suggesting a potential shift towards more specialized tools or a change in collaboration strategies.Reporting,analytics,and measurement tools remained a top investment area,with a slight decrease from 63.6%in 2023 to 60.3%in 2024,highlighting the ongoing importance of data-driven decision-making.Email marketing,messaging and onboarding tools,and customer experience and engagement tools all increased in 2024.These trends suggest a growing focus on customer onboarding,retention,and overall experience management.Email marketingKnowledge baseCollaborationReporting,analytics,and measurementDesignMessaging and onboardingCustomer and market researchCRMVideo marketingRoadmappingCompetitive enablementCompetitive intelligenceProject managementCustomer experience and engagementContent opps and marketingSales enablement63.6R.3c.6d.2p.2CUI7.17.7(.5.4).86.4.9.3R.3H.4F.5CA.58.36.12.50.7.1.4 .6%3.6A.7F.9C.3 232024402024 Report|State of Product MarketingDo you use AI in your role?If so,how are you using artificial intelligence to enhance your strategies?“Integrating Generative AI into our workflows has been a game-changer,significantly boosting productivity as if weve added an expert team member.“Working in a remote environment,I often use Large Language Models(LLMs)for brainstorming and overcoming creative blocks,enhancing my efficiency without stopping the work of my colleagues-whom I still rely upon,but for higher-value conversations.“AI is also invaluable in quickly summarizing extensive content,keeping me well-informed without needing to wade through lengthy documents or meetings.Additionally,AIs capability to instantly generate complex Excel or Google Sheets formulas,which usually require specialized skills,allows the team to operate more efficiently and securely.This strategic use of AI not only drives innovation but also maximizes productivity across a team.”“I use it for long form content production assistance.Not writing everything,but creating SEO friendly outlines and FAQ research.Also,marrating videos with text to speech(GCP has some good AI voice models).”Christopher Greco,Product Marketing Lead at TolokaBrian Dreyer,VP of Product Management at SightCall412024 Report|State of Product Marketing“As a sole product marketer,I need agility and Ive used AI to speed up data analysis and summarization.Tools like Senja and Ignition are my favorites for keeping battlecards and other competitive intel assets up-to-date.”“I dont write like Shakespeare(yet!),but internal AI tools assist me in generating content drafts.They help finesse existing copy,create new content based on brand guidelines,and even craft visuals.Pretty neat,right?“I also team up with agencies that leverage AI to adapt and optimize creative assets.This AI magic helps us work faster and keeps costs in check.“Finally,product recommendation engines are my secret weapon for delivering the right content to the right user at the perfect time.Its all about maximizing user engagement,and AI makes it possible.PMMs work on strategy,content and prioritization.”Daniel Viana,Senior Product Marketing Manager at UberflipPete Nuchanatanon,Head of Product Marketing at Grab422024 Report|State of Product Marketing#1 product marketing top tipWhat is your#1 tip for PMMs to be more effective?“Be visible.Product Marketing isnt meant to work its own.We act as that intersection between most of the teams within a company to the point that if youre doing your job right most people wont be sure which team youre on.So you need to attend other teams calls,join customer calls,build relationships with individuals,lead update calls,and build in public.”Mitch Comstock,Senior Product Marketing Manager at MedBridge“Stop trying to do everything and instead focus on what really moves the needle.“AI can indeed enable us to accomplish more,but its crucial to prioritize tasks based on their expected ROI.Define the MVP for your tasks once prioritized,and focus your efforts there.Anything beyond that is a bonus but not essential if more pressing issues exist.“Treat your work like a dynamic product roadmap:deliver one MVP,then move on to the next,continually iterating on the one that delivers the most value to your organization.Implement a rotation of tasks rather than concentrating solely on specific issues.This approach not only yields significant advancements but also rejuvenates your creativity by exposing you to various challenges,allowing for fresh insights and ideas upon revisiting tasks.”Christopher Greco,Product Marketing Lead at Toloka432024 Report|State of Product Marketing“Get exposed to as many mental models and problem-solving frameworks as possible,not just those specific to product marketing.As PMMs,were often thrust into uncharted situations,needing to navigate unstructured data points and influence diverse personalities across multiple teams.“By immersing yourself in a range of models,youll have a toolbelt of ammos to tackle greenfield challenges,iterate your approach,and rally stakeholders to your cause.Ive found books and podcasts on integrated thinking,problem reframing,and business strategies particularly valuable for this purpose.”“One of the best attributes any product marketer can bring to the role is being empathic.To see the world from your customers point of view and understand the“why”behind what they care about;their motivations,challenges and what they want to achieve personally and professionally.“Also being empathetic when you are working with your product,marketing and sales partners to understand their roles and how you can help make their jobs easier.The better you can understand your team dynamics and the shared goals and vision,the more effective you can be to make an impact as a product marketer.“How can you do this?Keep digging to get to the root cause of the problem or situation.Keep asking why.”Rita Chan,Director of Product Marketing at ShiftboardChloe Nicholls,Senior Product Marketing and Go-To-Market Strategist442024 Report|State of Product Marketing“This might sound simple,but its the golden rule for PMMs:crystallize the problem were solving.Being spread thin can lead to generic PMM initiatives that lack punch.Heres the key:dont get lost in the weeds!“Think of PMMs as specialists within a general field.If we dont laser focus on the specific problem that needs solving,our efforts can become scattered.By staying centered on the core issue,we can effectively leverage the many tools at our disposal product research,marketing strategies,creative copywriting,and more to ensure the resulting product is truly the best solution for users.“Its not about dictating the exact solution,but rather defining the problems boundaries and scope.Understanding what users are willing to accept and trade-off empowers product and engineering teams to develop a product with the highest chance of success.“By becoming masters of pinpointing the core problem,PMMs become invaluable assets,ensuring products are user-centric and drive business growth.Remember,a PMM with laser focus is a PMM who can truly make a difference!”“Read often.Stay updated with industry newsletters,read books by industry experts like April Dunford,and review competitor case studies.Read and subscribe to newsletters and new books by your favorite author or journalist,or read about your hobbies.Youll develop a strong point of view within your industry,sharpen your writing and storytelling ability,and ultimately become a better product marketer.And reading is fun when the subject matter is interesting to you!”Casey OhashiSenior Product Marketing Manager at TripleLiftPete Nuchanatanon,Head of Product Marketing at Grab452024 Report|State of Product Marketing“Think outside the box.Maximize the doors that are open to you to think creatively about your product,about your customers,about their pain points,and identify opportunities to better position,message,and drive product adoption.Connect your suggestions back to your organizations goals and KPIs.Invest in relationships across the org and seniority levels so you can turn colleagues into strategic partners.Once youve done that,advocate,advocate,advocate.Back up your ideas and suggestions with data and most importantly,ground it in the voice of your customers.”“Know your companys(and your boss)priorities.As a Product Marketer,you operate in a broad function and must keep tabs on what matters to solve organizational challenges.In times of doing more with less,you need to do less better.”Daniel Viana,Senior Product Marketing Manager at UberflipHannah Pickering,Senior Product Marketing Manager at HealthEquity2024 Report46State of Product MarketingConclusionThanks for reading the State of Product Marketing 2024 Report-and a huge thank you to our amazing contributors!This comprehensive insight into the product marketing landscape revealed a heavy focus on B2B customer bases(75.6%)and SaaS products(79.1%),with smaller product marketing teams(1-5 people)being predominant(nearly 80%).Concerningly,over 10%of product marketers do not track KPIs,indicating potential gaps in performance evaluation.Financial constraints emerge as a significant challenge,with 35.6%lacking a dedicated product marketing budget,potentially impeding innovation.While 65.6%are invited to leadership meetings,only 66.3el adequately supported by leadership,highlighting a need for improved support structures.Notably,5.9%express a desire to change both career path and company,emphasizing the importance of talent retention and organizational culture improvement.Overall,this report has revealed the potential need for more strategic alignment,resource optimization,and enhanced support to navigate challenges and capitalize on opportunities in the marketplace.What did you think of the findings?Be sure to let us know!Join our Slack community2024 Report|State of Product MarketingMeet the teamCharley Gale Copywriter and Content LeadCharley is the Content Lead here at Product Marketing Alliance.She has a passion for writing and creating new content for the community.She is always open to new ideas,so would love to hear from you with your feedback!Richard King Founder of Product Marketing AllianceRich is the Founder of Product Marketing Alliance and is at the helm of our voyage to elevate the PMM role worldwide.Hes responsible for what happens next with the community,so if youd like to have your say,dont hesitate to get in touch-Rich is always open to invaluable feedback and ideas.Lucy Sproule Senior Graphic DesignerLucy is our talented Graphic Designer who specializes in fulfilling all our design needs.Shes in charge of creating the layout and incorporating visual elements in this report and is always eager to hear your thoughts on her designs!LinkedInLinkedInLinkedIn2024 Report|State of Product Marketing
2024-12-31
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2024 OutlookA Snapshot into Ad Spend,Opportunities,and Strategies for Growth November 2023TABLE OF CONTENTSOBJECTIVES 3KEY INSIGHTS 42024 AD SPEND OUTLOOK 5CHALLENGES&GROWTH STRATEGIES 10PLANNING TIMEFRAMES 16AD SUPPLY CHAIN SUSTAINABILITY 20APPENDIX 23 METHODOLOGY&RESPONDENT PROFILE ABOUT IAB2ObjectivesPurpose:2024 Outlook:A Snapshot into Ad Spend,Opportunities,and Strategies for Growth was conducted by IAB to provide the digital ad-supported ecosystem with a forward-looking view into the 2024 ad spending marketplace(including both spend levels and strategies)being projected by buy-side ad investment decision-makers,primarily at brands and agencies.Whats Included:A view into overall ad spend as well as at the channel levelA perspective on industry challenges and growth strategiesInsights into planning timeframes and ad supply chain sustainability practicesHow to Use the Results:Plan for the year aheadBenchmark competitive positioning/strategy in the marketplaceIdentify white space,channels,and opportunities,brainstorm ideas for launching new products and services,finding new targets,and growing ROI34Key Insights4012024 AD SPEND OUTLOOKBuyers project to increase their ad spend 9.5%in 2024 vs.2023.All digital channels are expected to post ad spend growth in 2024,led by CTV,Social,and Search.02CHALLENGES&GROWTH STRATEGIESBuyers top goals for 2024 span the purchase funnel:customer acquisition,brand equity,and media efficiency,while their top challenges are economic and measurement/data-driven.03PLANNING TIMEFRAMESBuyers are now planning media with multiple iterations:70%are planning their buys quarterly or more frequently.63%are also reforecasting more often due to market dynamism.04AD CAMPAIGN SUSTAINABILITY Only 1-in-5 buyers are currently requiring partners to meet ad campaign sustainability requirements.Buyers are largely undecided about if and how partner ad sustainability policies will impact their ad spending.HEADER2024 AD SPENDOUTLOOK156 9.5%Change2024 vs.2023:HEADERBuyers project to increase their ad spend 9.5%in 2024 vs.2023n=203Q:Provide your best estimate for the following:budget percent /-for projected 2024 total media ad spend vs.actual 2023 total media ad spend.7-1.4%-0.5%5.1%5.1%6.0%8.1%8.6%9.6.1.4.5%CTVSocial MediaPaid Search(SEM)PodcastsDigital Video(excl.CTV)Digital Out-of-Home(DOOH)Digital Audio(excl.Podcasts)GamingDigital DisplayLinear TV(Broadcast and Cable)Other Traditional Media(Radio,Print,OOH,Direct Mail)%CHANGE AD SPEND 2024 vs.2023,BY CHANNELHEADERAll digital channels are expected to post ad spend growth in 2024,led by CTV,Social,and Searchn=floating baseQ:Provide your best estimate for the following:budget percent /-for projected 2024 total media spend vs actual 2023 total media ad spend by CHANNEL.8HEADERDigital video(incl.CTV)will capture the greatest%share of ad spend in 2024Digital Video(incl.CTV)Paid Search(SEM)Social MediaDigital DisplayPodcastsDigital Out-of-Home(DOOH)Digital Audio(excl.Podcasts)GamingLinear TV(Broadcast and Cable)Other Traditional Media%SHARE 2024 AD SPEND BY CHANNEL(Radio,Print,OOH,Direct Mail)6.2.4%1.3%3.6%3.8%3.8.6.3.5.6 24n=203Q:Provide your best estimate for your budget PERCENT SHARE by CHANNEL for projected 2024 media ad spend.9IABs Retail Media 2023 study found that brand buyers are reallocating funds to increase Retail Media dollars from across digital platforms(incl.social,search,digital video/CTV),traditional media(incl.linear TV,print,OOH),and“below-the-line”shopper/trade marketing.n=77,Among Retail Media buyers(primarily CPG/Beauty)Q:Provide your best estimate for the following:budget percent /-for projected 2024 total media ad spend vs.actual 2023 total media ad spend.Retail Media ad buyers(primarily CPG/beauty)project to increase their ad spend in the channel 21.8%in 2024 vs.2023 21.8%Retail Media%Change2024 vs.2023:HEADERCHALLENGES&GROWTH STRATEGIES210111107BItermine use cases for/leverage Generative AIImprove marketing mix modeling(MMM)resultsIncrease share of voiceDrive repeat purchases among existing customersExplore new advertising KPIsOptimize reach and frequencyLeverage our data to drive precision and effectivenessImprove media efficiencyIncrease brand equityAcquire new customersTOP 3 GOALS FOR MEDIA INVESTMENTS IN 2024HEADERBuyers top goals for 2024 span the purchase funnel:customer acquisition,brand equity,and media efficiencyn=203;Answer choices below 10%not shownQ:What are your top three goals for your 2024 media investments?Select up to 3.1256&%Significantly/Somewhat MorePerformance AdvertisingNo changeSignificantly/Somewhat MoreBrand Advertising2024 SHARE OF SPEND ON PERFORMANCE VS.BRAND ADVERTISINGHEADERTo achieve their goals,more than half(56%)of buyers are increasing performance advertising in 2024n=203 Q:In 2024,how will your share of spend on performance advertising change compared to brand advertising?In 2024,I will spend1312#%(467DI%Pervasiveness of Made for Advertising(MFA)sitesEnsuring privacy complianceLack of impact understanding:ongoing state privacy lawsHaving the ability to increase ad spend in emerging channelsEnsuring brand safety and suitabilityUnderstanding evolving consumer habitsHaving budget/creative capabilities to increase CTV ad spendUnderstanding Gen AI and/or navigating its potential threatsLack of impact understanding:3P cookie loss/platform changesMitigating ad fraudLack of standard currency for TV/CTV/Digital VideoMedia inflationManaging reach and frequency across screens and channelsHaving enough 1P data for targeting,activation,etc.Executing cross-channel media measurementSlowing U.S.economyGREATEST CONCERNS FOR MEDIA INVESTMENTS IN 2024HEADERBuyers top challenges for 2024 are economic and measurement/data-drivenn=203;Answer choices below 10%not shownQ:What are your greatest concerns and/or challenges regarding media investment in 2024?Select all that apply.Large media spenders(spending$50M annually)are more likely to note this as a concern:35%.1476pfVSG9520%723%1%2%2%3%3%4%5%8%5%9288%Cross-platform measurementFirst-party data acquisition/partnershipsAttribution modelingGenerative AIMarketing mix modeling(MMM)Attention metricsData clean roomsDEI(diversity,equity,and inclusion)Ad supply chain sustainabilityWeb3(including metaverse,NFTs,etc.)Significantly/Somewhat MoreSameSignificantly/Somewhat LessN/ATOPICS/SOLUTIONS:LEVEL OF FOCUS IN 2024n=203Q:Do you expect to FOCUS more,less,or the same amount of time and/or resources in 2024(vs.2023)on the following?As a result,buyers will be highly focused on measurement and targeting,including cross-platform,first-party data,and modelingLarge media spenders(spending$50M annually)are more likely to be focusing more on data clean rooms in 2024:59%.1560QE41#)!2$%9%4%5%7!95SS16b placements with publishers with 1P dataCreator/influencer ads and partnershipsBehavioral adsShoppable adsCohort-based adsIn-game adsAugmented Reality(AR)adsAds adjacent to local news contentAds adjacent to national news contentPolitical adsSignificantly/Somewhat MoreSameSignificantly/Somewhat LessN/AAD TYPES:LEVEL OF FOCUS IN 2024n=203Q:Do you expect to FOCUS more,less,or the same amount of time and/or resources in 2024(vs.2023)on the following?And ad placements with publishers that have first-party data are by far buyers top ad focus in 2024Large media spenders(spending$50M annually)are more likely to be focusing more on creator/influencer ads and partnerships and cohort-based ads:62%and 44%,respectively.HEADERPLANNING TIMEFRAMES3161730(%3%OngoingMonthlyQuarterlyBiannuallyAnnuallyTIMEFRAME USED TO PLAN MEDIA BUYSHEADERBuyers are planning media with multiple iterations:70%are doing so quarterly or more frequentlyn=203 Q:What timeframe do you use to plan your media buys?18%APPROACHING 2024 MEDIA PLANNING DIFFERENTLY DUE TO MARKETPLACE DYNAMISM HEADERAgility is key:Budgets are being evaluated more frequently in times of economic uncertainty27c%No,things are being handled as normalYes,we are no longer budgeting for thelong termYes,we now have a contingency planYes,we are evaluating and reforecastingmore frequentlyn=203Q:Given the marketplace dynamism,are you approaching 2024 media ad spend planning differently than you normally would?Select all that apply.193D4%2%1ilyWeeklyMonthlyQuarterlyBiannuallyAnnuallyFREQUENCY OF ADJUSTING 2024 MEDIA PLANSAmong those evaluating and reforecasting 2024 media ad spend more frequently as a result of changing marketplace dynamicsHEADEROf those reforecasting more frequently,63%are doing so monthly or more oftenn=128,Among those evaluating and reforecasting 2024 media ad spend more frequently as a result of changing marketplace dynamicsQ:You indicated that you are evaluating and reforecasting 2024 media ad spend more frequently as a result of changing marketplace dynamics.How frequently are you adjusting your plans?HEADERAD SUPPLY CHAIN SUSTAINABILITY4202119W$%YesNoDont knowHEADEROnly 1-in-5 buyers are currently requiring partners to meet ad campaign sustainability requirementsn=203Q:Do you require your ad partners to meet minimum requirements for ad supply chain sustainability in RFPs and I/Os(requests for proposals and insertion orders)?WHETHER BUYERS REQUIRE THEIR PARTNERS TO MEET AD CAMPAIGN SUSTAINABILITY REQUIREMENTS22AD CAMPAIGN SUSTAINABILITY POLICIESHEADERBuyers are largely undecided about if and how partner ad sustainability policies will impact their ad spending 3441PQTeW1 partner sustainability policies do notimpact decisions regarding RFPsAd supply chain sustainability policies donot impact my ad budgetIm more likely to use ad partners withsustainability policiesI spend more with ad partners that havesustainability policiesI will not spend with ad partners that donot meet my minimum sustainabilityrequirementsStrongly/Somewhat AgreeNeitherStrongly/Somewhat Disagreen=203Q:To what extent do you agree or disagree with the following about an ad partners ad supply chain sustainability policies?Thank You!For further information:Jack Koch()Chris Bruderle()Meredith Guiness()24Methodology&Respondent Profile32Y%9%COMPANY TYPEBrandsAgenciesOther(e.g.,Marcomm,Consultancies)Email survey sent to buy-side ad investment decision-makers,primarily at brands and agencies Field dates:10/20/23-11/9/23n=20379%2%JOB TITLEDirector (e.g.,C-level,SVP,VP,etc.)Manager(e.g.,Planner,Buyer,Strategist,etc.)Junior(e.g,Analyst,Planning Assistant,etc.)25About IABThe Interactive Advertising Bureau empowers the media and marketing industries to thrive in the digital economy.Its membership comprises more than 700 leading media companies,brands,agencies,and the technology firms responsible for selling,delivering,and optimizing digital ad marketing campaigns.The trade group fields critical research on interactive advertising,while also educating brands,agencies,and the wider business community on the importance of digital marketing.In affiliation with the IAB Tech Lab,IAB develops technical standards 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