NEWS: Study reveals conditional selling

Media owners are abusing their power by conditionally selling across their portfolio of press titles or TV channels, advertisers have warned.

Media owners are abusing their power by conditionally selling across

their portfolio of press titles or TV channels, advertisers have warned.



Two thirds of advertisers admit that they have been subjected to

conditional selling in the past 12 months, according to an extensive

survey of advertisers’ attitudes conducted by Media Audits.



The survey found that the majority of advertisers have been involved in

media deals where the channel or title they wanted to use was only

available at a reasonable price if they also used a sister title or

channel.



John Storey, the managing director of Media Audits, said: ‘Press and TV

were the worst offenders, with 27 per cent claiming to have been

conditionally sold press titles and 24 per cent experiencing conditional

selling in TV.’



In TV this is thought to be a result of the concentration of TV sales houses, with more than eight out of ten advertisers believing that this

has reduced the level of competition in TV sales.



At the same time, 70 per cent of advertisers firmly believe that

conditional selling is not in their interests.



The survey, which questioned 82 leading companies with a combined

advertising spend of pounds 664 million, also canvassed advertisers on

their favoured method of remuneration for their media companies.



Performance-related pay is increasingly attractive to advertisers, with

more than two thirds already using this method or examining the

possibility of introducing it.



Media commissions of between 2 and 3.5 per cent are the most common,

with more than half of advertisers falling into this band. Of those with

budgets of up to pounds 5 million, 40 per cent paid commission of 3 per

cent or less. Seventy per cent of advertisers with budgets of more than

pounds 5 million paid 3 per cent or less.



As for media spend, budgets for 1996 are expected to be 3 per cent up on

1995. Almost a third of advertisers claim to have changed their

investment in ITV as a result of the inflation last year. The majority

of these say that they have reduced spend on ITV.



More than half of advertisers plan to increase their spend on outdoor

this year, while Channel 5 hopes to attract an average 5 per cent of

advertisers’ 1997 budgets.



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Digital marketing executives oversee the online marketing strategy for their organisation. They plan and execute digital (including email) marketing campaigns and design, maintain and supply content for the organisation's website(s).