Steve Goodman and Peter Thomson, two former UK media agency leaders, have set up The Press Business as a specialist agency for press planning and buying.
Goodman, former managing director of print trading at Group M, and Thomson, founder of now-defunct Omnicom shop M2M, said they see a gap for a press specialist "in the way the radio and outdoor industry has been served for so long".
The value of newspaper and magazine media has been "overlooked" as money has flowed online, according to Goodman, who claimed The Press Business is "the UK’s first press agency" for the digital age.
In an interview with Campaign, the duo said they want to "promote the value of the medium", that they "care about how the medium is used" and they will look to "develop new opportunities" such as potentially using Pamco audience data as a trading currency.
Goodman and Thomson hope their new agency can "de-commoditise press buying" and "eradicate dubious practices".
Thomson painted a picture where press has become "unrewarding" for some bigger agencies, which can make better margins from investing in digital, and "uneconomic" for some smaller shops, which do not have the staff to look after press and regard it as a niche.
The Press Business will offer press planning and buying to agencies that want to outsource that function and save costs.
'Our positioning is transparency'
Goodman and Thomson said they "will aim to deliver best value to each client by shunning agency deals".
They will negotiate prices on a "line by line" basis and want their agency to be "fairly remunerated".
Goodman said: "Our positioning is transparency."
Thomson explained that advertisers have had some good reasons for investing in data-driven, online advertising and big platforms such as Google and Facebook, but the shift in investment away from press has also suited the financial interests of some agency groups.
"Because press wasn’t making as much money for the agencies, they were under-planning it," he said.
Thomson was scathing about what he called "a fundamental decline of trust" and cited a number of "opaque" ways that agencies generate income, including receiving rebates in cash and free ad space from media owners in return for certain volumes of spend.
He said: "If we get given free space or a cash rebate, we will give it back to the client."
Thomson went on: "Some of the practices that have been going on of late sadden me. I used to be proud to go down the pub and say I worked in advertising. Some of the things that are happening now make me ashamed of being in advertising."
Some of the big agency groups need to behave "less like football agents", he added.
Goodman, who departed Group M earlier in the autumn, said he would not comment.
A growing role for specialists?
The Press Business has taken temporary space in the offices of independent agency AMS in King’s Cross, but has not yet announced any clients.
Thomson said structural change across the advertising industry, including brands taking digital marketing services in-house, meant there was a growing role for specialist agencies.
"There’s going to be a wave of nimble specialists" as clients "increasingly go a la carte", Thomson predicted.
When it comes to newspaper and magazine media, in particular, it is "now really difficult" to find a "good press buyer" in some agencies, because a lot of young talent only wants "to be involved in digital", Goodman added.
Thomson praised out-of-home specialists for their "admirable" and "detailed" knowledge of the sector and said that showed there was room for a press specialist.
He acknowledged that rebates are prevalent in OOH and admitted: "What I don’t want to do is replicate the less transparent practices that they’ve fallen into."
Goodman and Thomson estimated that the UK newspaper and magazine display advertising market is worth in the region of £1bn a year – divided roughly equally between the big six agency groups and independents – and The Press Business hopes to win a 10% share of the independent sector.
That could hypothetically be a £50m opportunity for Goodman and Thomson’s agency, which will plan and buy across print and online.
Newspapers and magazines generated £7bn in ad sales, including regionals and classifieds, at their peak in 2004, when they still represented more than 50% of UK media expenditure, according to an estimate by Warc.
Spend on press slumped to £1.7bn, including classifieds, or only 8% of the market, by 2018 – with only some of that loss being offset by online ad sales growth.
Recent consolidation such as Future’s planned acquisition of TI Media and the newspaper industry’s efforts to pool digital display ad inventory with The Ozone Project are helping to simplify the market and should make it easier for advertisers, Goodman and Thomson said.
Wave of start-ups
The Press Business has taken inspiration for its name from Goodman’s old employer, The Media Business, which became part of MediaCom and Group M.
Goodman and Thomson have known each other for three decades.
Goodman, 58, spent more than 35 years at Group M and its subsidiaries, where he became one of the UK’s top press buyers.
Thomson, 53, founded M2M in 2003, with an ethos that it would offer a "measure-to-measure" service for clients within Omnicom. He left in 2011.
The launch of The Press Business comes after Simon Davis, former chief executive of Blue 449, founded Walk-In Media, with backing from MSQ Partners.
Walk-In Media has talked about "tackling the inflexibility, trust and transparency issues often related to holding companies" in a similar manner to The Press Business.
Other recent media-focused agency start-ups include Bountiful Cow, Craft Media and Love Sugar Science, which were all founded by former network agency executives.
Thomson said: "The world has changed and the networks have not adapted to the change."
Goodman added that he was optimistic that "newspapers and magazines are going to be around for a very long time".
Tracy De Groose, executive chair Newsworks, welcomed the launch of The Press Business because Goodman and Thomson "understand the value of news media".
Many advertisers "are not planning the right levels of investment" and it is vital to tackle "the absurdity of treating all digital as the same", De Groose added.
"Championing change to address this and deliver more engaged audiences for advertisers has got to be a good thing," she said.