Media Forum: Is ad sales practice a worry?

Is conditional selling an issue in the current soft market?

Curiouser and curiouser. The legal department of the IPA is currently considering a complaint lodged by a media agency that a large media owner, believed to be News International, is acting in an anti-competitive manner.

The allegation claims that said media owner is indulging in the practice of "conditional selling" - in other words, not allowing an advertiser to buy space in publications "a" and "b" unless it also agrees to embrace publication "c" as well.

If true, this will soon be a matter for the Office of Fair Trading. And then everyone will be sorry. Especially as there are said to be similar resentments building as regards the way ITV1 is being sold in the context of the network's family of digital-only channels.

But this is, on the face of it, a somewhat bizarre story. Surely, we've entered the most pronounced buyer's market in living memory. And even before the credit crunch began pitching into a full-blown recession, there was evidence that media owners - and publishers especially - were prioritising market share over yield.

So it's surely a rather feeble media agency that feels it's being so badly pistol-whipped by a media owner that it has to go running to the OFT.

And, of course, yes, it's true that both News International and Associated Newspapers have moved to hub structures where all sales teams are charged with selling all the company's properties - so broader types of conversations can certainly be envisaged these days.

But still. Conditional selling surely isn't a problem in today's market. Is it? Dominic Williams, Carat's press director, reckons not. He says: "If a media owner can package things up for us in a way that will ultimately benefit our clients, then great. Advertisers are open to any suggestion that will help them in terms of reaching an audience. But we will not stand for any nonsense if it's not right for our clients."

It's not always as simple as that, Andy Jones, the chief executive of Universal McCann, responds. He says: "We've not seen any problems ourselves - but, regardless of the state of the overall market, if your planning objectives on specific campaigns are being compromised, then it's clearly an issue. And any agency encountering these sorts of problems has a right to complain."

But Chris Locke, the trading director of VivaKi Trading UK, argues that the new hub structure now favoured by some publishers can work both ways. Yes, when The Sun and News of the World are on a schedule, NI's sales people may make polite inquiries as to whether or not thelondonpaper might be added to that schedule. Equally, though, an astute negotiator might ask whether NI might care to walk an extra mile for an agency's clients.

But he can also see how pressures may build, even in a slow market. The plaintiff agency in this instance may have won a piece of business on ludicrous claims it made on rates it could achieve - and is now piqued at being unable to deliver.

Locke adds: "Sales teams aren't there to give stuff away. There are always robust conversations where a strong product such as The Sun is concerned - and it might be the case with some agencies that if there are conversations on behalf of ten clients, there will be a falling out as regards two of those conversations."

Mark Jarvis, a partner at the7stars, reckons it's the biggest buying points, operating group deals, that may struggle to deliver the finesse needed to manage individual client needs in negotiations with larger media owners.

He concludes: "It's inevitable that media owners will use all their available inventory - and strong-arm tactics if relevant - to maximise their income. But only if buyers allow this to happen. In these straitened times, I'm not entirely convinced that media owners really have an appetite to start a war on this front. My experience is that they much prefer to work with buyers to deliver meaningful campaigns, using the relevant parts of their inventory."

NO - Dominic Williams, press director, Carat

"Some media owners will try every trick in the book - but they know they can't push advertisers too far. We will not stand for any nonsense if it's not right for our clients. That will always be the case, no matter what the business climate is."

YES - Andy Jones, chief executive, Universal McCann

"It's well known that there have been problems in the TV market in recent years. If it happens in the press market, it's even more problematical because there isn't a regulator specifically to look at this sort of thing."

MAYBE - Chris Locke, trading director, VivaKi Trading UK

"There are retail advertisers that have to be in, say, The Sun. If an advertiser in that situation can't get the deal it wants, then you might find that its agency will blame the media owner rather than itself."

MAYBE - Mark Jarvis, partner, the7stars

"Leveraged trading will happen if buyers allow it to happen. And it may also be true that conditional deals are something that big networks struggle to square off against the fundamentals of managing their huge and unwieldy group deals."

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