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Analysis: The Growing Trust Deficit

Advertisers and agencies have a complicated relationship, and trust makes a key part of it. However, in recent years, there has been a decline in the trust that an advertiser has in its agency partners. Only 10 per cent of advertisers globally trust their agency partners, according to a recent survey by ID Comms

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Trust Levels Between advertisers and their media agency partners have fallen further in the last two years, according to a new research report.

The ID Comms 2018 Global Media Transparen­cy Survey shows that just 10 per cent of advertisers rate levels of trust with their agency partners as high or very high. By contrast, the number of those that believe that trust is low has increased from 29 per cent to 40 per cent, and of those that believe it is average has fallen by 12 per cent.

The findings are disap­pointing considering that the previous media transparency survey was conducted at a time when the Association of National Advertisers (ANA) was in­vestigating media rebates in the US and advertisers’ concerns that agencies were benefiting from un­declared income streams were at their height.

Since then, advertisers have worked hard to im­prove their media knowl­edge and take greater control over how their ad budgets are spent. Many have adjusted contracts with existing suppliers or held pitches that demand greater transparency as a condition of participation.

The research report quoted an advertiser as saying, “Trust has been breached in a profound way between advertisers and media agencies. The concept of an agency as a true agent is extinct for all practical purposes.”

However, the good news is that as a result of these efforts many are positive about the future levels of trust. The report shows a 20 per cent increase in the number of agencies and advertisers that expect trust to increase ‘a little’ or ‘a lot’ over 12 months.

The results are based on 232 responses from advertisers across a diverse range of sectors and geog­raphies that spend more than $25 billion on media around the world. Respon­dents were drawn from a mix of roles across market­ing, media and procure­ment. Agency respondents represented all the major agency holding groups and many independent media agencies.
“The vast majority of both agencies and adver­tisers agree that a close, trusted relationship is likely to lead to better marketing performance but, sadly, right now levels of trust are much lower than they should be. This is reducing the ability of media partners to use their skills and knowledge to help advertisers grow their businesses,” said Susy Pyzer-Knapp, consultant at ID Comms on the find­ings of the research.

The 2018 survey found that transparency is still a critical component in building trust and an in­creased number of agency respondents now agree with this. The number of agency respondents who endorsed the high impact of transparency on trust has tripled in the last two years to 35 per cent.

Among both advertisers and agency respondents, the four most important areas of transparency that drive trust have not changed since 2016. These include how an agency manages rebates/ AVBs, makes money, trades with media vendors and uses group buying/ share deals.  

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magazine 29 september 2018 marketing and advertising