How can barter add value to your media budget?

Barter is an attractive option for all types of advertisers these days, two experts say - and not just in times of economic hardship.

Graham Duff, MD UK & Europe, Miroma
Graham Duff, MD UK & Europe, Miroma


- Corporate barter can seem confusing. Explain how it works in simple terms.

Barter provides a straightforward way for brand owners to create value by using their own products or services to maximise their adspend. The role of specialists such as Miroma is to make it happen and to manage the process.

- How can corporate barter add value to advertisers?

First, it gives brand owners the ability to pay for media more cost-effectively. By part-paying for media using their own inventory, brand owners are releasing capital tied up in their own products or services, without reducing their market value. Because brand owners can transfer their margins on these goods and services to the media they are buying, it costs them less to buy media than if they were paying for it all in cash. In effect, this means that they are likely to be able to spend more overall on advertising. Barter can also create opportunities for brands to trial new media channels. Miroma works closely with agencies to ensure these fit with agreed media strategies. Finally, barter companies should be experts in product distribution, opening up new channels according to strict, prearranged criteria that the brand's sales and distribution teams will stipulate. Barter companies are placing an increased emphasis on using their expertise in product distribution as a way of adding value.

- Is corporate barter more suited to certain types of advertisers than others?

All brand owners can benefit from corporate barter, from utilities companies to financial services brands.

At Miroma, our clients include a high-street retailer, an events and entertainment company and a well-known car manufacturer. The key question for advertisers is: do you have capital tied up in unsold goods and services that could be used to part-pay for advertising?

- How can advertisers get the most out of a corporate barter deal?

The way a corporate barter deal is managed is critical to its success. It's vital to make sure you get buy-in from everyone involved in the process. This means talking to colleagues in procurement and sales to decide which products or services can be used to support future media campaigns. Your media agency is integral to the process, so involve them early on. The process of planning and buying media remains the same as it would do without barter. Once the media plans are agreed, get the barter company to review them and explain how much of your media spend could be traded and how much value they can offer.

- Is barter just a phenomenon borne out of recession or is it here to stay?

Barter is fast becoming a more integral part of the marketing and sales mix because agencies and brands recognise the additional value that it can deliver. Is barter here to stay? The evidence suggests it is; after all, companies such as Miroma and Astus have been around for nearly ten years. There's no doubt the economic slump has prompted companies to re-examine all aspects of their business, but it's also clear that corporate barter will continue to grow because it offers a proven way of making ad budgets work even harder.


- Corporate barter can seem confusing. Explain how it works in simple terms.

It's actually very simple in principle. Put simply, in addition to cash, advertisers can pay for some of their media with products or services to boost their marketing budgets. I think it's fair to say that, in the past, the overuse of jargon and some misconceptions around the business model clouded this simple concept.

- How can corporate barter add value to advertisers?

Previously, barter was an outlet for advertisers to gain media value in exchange for product over-runs, used machinery, short-dated stock and widgets. It now has a broader scope that covers first-line stock to financial services. It also facilitates innovative product solutions such as testing new markets, sampling, research and generating a guaranteed return on investment from media spend. Essentially, there are many ways in which a client can use barter to boost marketing budgets.

- Is corporate barter more suited to certain types of advertisers than others?

Not any more. There are more and more ways of using barter that can suit any client looking to reach consumers using media. No two barter deals are exactly the same, which is why having an in-house barter specialist ensures our clients have full knowledge of the solutions available. Crucially, we give impartial advice on whether barter is a suitable solution for a client on a case-by-case basis.

- How can advertisers get the most out of a corporate barter deal?

Remaining true to the communication objectives has to be the primary focus. As long as advertisers have a media agency in place with that philosophy, then clients will continue to enjoy the best returns from barter deals.

It must never be forgotten that what barter can offer is commercial enhancement of the best possible media solution. Commercial trade benefits are not an end in themselves, so the role of in-house agency barter specialists is to maximise the benefits, but to do so without compromising the communication objectives in any way.

- Is barter just a phenomenon borne out of recession or is it here to stay?

Any business will explore every possible avenue to maximise return versus investment, and our clients are no different. Many advertisers recognise the value opportunities in using products and services to boost their media spend, and we play the pivotal role in driving that value in line with the marketing and business objectives of our clients. And let's not forget that there are benefits in this for media owners as well. They can generate incremental revenue or cover costs such as travel, entertaining and media. With new, innovative ways to use products and services being developed all the time, it is clear that the benefits for advertisers and media owners alike will ensure that barter is here to stay.


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