Media houses deepen roots in market
Formerly, ad agencies here were a one-stop shop, supplying a range of client services from creating and producing ads to buying media and planning ad and direct marketing campaigns.
But in recent years, advertising agencies have started separating their media planning and buying operations from the rest of the company, said Al Harris, managing director with stand-alone media house Media Group.
Six years ago there were no media houses in Poland - most were only formed three or four years ago. "Since then, it has been pretty stable," Harris said. Right now, there are about seven full-fledged media houses in Poland. And ad agencies will likely continue the trend of splitting off their media departments into separate operations.
"That's probably from where the growth will come," he said, adding that any increase in large-scale, independent media houses would be minimal. But the possibility exists for the formation smaller, Polish media houses serving niche clients, Harris said.
The cost and time associated with research and ad campaign planning divisions already sets media departments apart from the creative and production work of ad agencies, Harris said. Thus, the current trend is a natural spin-off and a matter of simple economics.
"Media departments are splitting from ad agencies in order to attract more work," Harris said. While in-house media departments can access an international agency's local and global client base, small ad agencies outsource media planning and buying services. And that spells opportunity for media houses. At independent start-up Media, the sharper focus on buying and planning has translated into billings growth of up to 60% a year during the past several years, Harris said. Last year, billings came to zl. 80 million ($22.8 million) and are projected at zl. 120 million ($30.7 million) this year, he said.
Initiative Media spun off from ad agency Ammirati Puras Lintas in summer 1998 and is projecting billings of zl. 250 million ($64.1 million) this year, said Rupert Slade, the company's media planning director. "What a media planning person does is decide what is the best medium for advertising," Slade said. "We're not just buying spots." Those decisions focus on specialized research for a product, determining its niche and what medium to use, and even what the best times of the day or year are to run an ad.
"Good media people understand targeting," Slade said, adding that although Initiative serves some Ammirati Puras Lintas' clients, the ad agency does not direct its operations. "They don't tell us what to do."
Not all large agencies are splitting off their media departments as completely separate operations. Last year, media house Zenith was created when Saatchi & Saatchi and advertising agency Bates broke apart, said Charles Sampson, chief executive officer with Saatchi & Saatchi
Zenith is considered a dependent media house, jointly owned by Saatchi & Saatchi and holding company Cordiant, and automatically gets business from Saatchi & Saatchi as well as pitching for its own business.
"Clearly the trend is toward separation," Sampson said of media houses.
But separation is not without perils, agencies said. The further you move media planning and buying away from the creative and production process, serving clients becomes more difficult, Sampson said. "At the end of the day, it's basically clients who determine what way the media will go."
Perception is another problem facing the emerging media house sector. Polish advertising agencies may hesitate to go to media planners because they are perceived as companies that only do the buying, Slade said. In fact, the best way for a project to be effective is if the creative agency, media house and client all work as one team.
But in recent years, advertising agencies have started separating their media planning and buying operations from the rest of the company, said Al Harris, managing director with stand-alone media house Media Group.
Six years ago there were no media houses in Poland - most were only formed three or four years ago. "Since then, it has been pretty stable," Harris said. Right now, there are about seven full-fledged media houses in Poland. And ad agencies will likely continue the trend of splitting off their media departments into separate operations.
"That's probably from where the growth will come," he said, adding that any increase in large-scale, independent media houses would be minimal. But the possibility exists for the formation smaller, Polish media houses serving niche clients, Harris said.
The cost and time associated with research and ad campaign planning divisions already sets media departments apart from the creative and production work of ad agencies, Harris said. Thus, the current trend is a natural spin-off and a matter of simple economics.
"Media departments are splitting from ad agencies in order to attract more work," Harris said. While in-house media departments can access an international agency's local and global client base, small ad agencies outsource media planning and buying services. And that spells opportunity for media houses. At independent start-up Media, the sharper focus on buying and planning has translated into billings growth of up to 60% a year during the past several years, Harris said. Last year, billings came to zl. 80 million ($22.8 million) and are projected at zl. 120 million ($30.7 million) this year, he said.
Initiative Media spun off from ad agency Ammirati Puras Lintas in summer 1998 and is projecting billings of zl. 250 million ($64.1 million) this year, said Rupert Slade, the company's media planning director. "What a media planning person does is decide what is the best medium for advertising," Slade said. "We're not just buying spots." Those decisions focus on specialized research for a product, determining its niche and what medium to use, and even what the best times of the day or year are to run an ad.
"Good media people understand targeting," Slade said, adding that although Initiative serves some Ammirati Puras Lintas' clients, the ad agency does not direct its operations. "They don't tell us what to do."
Not all large agencies are splitting off their media departments as completely separate operations. Last year, media house Zenith was created when Saatchi & Saatchi and advertising agency Bates broke apart, said Charles Sampson, chief executive officer with Saatchi & Saatchi
Zenith is considered a dependent media house, jointly owned by Saatchi & Saatchi and holding company Cordiant, and automatically gets business from Saatchi & Saatchi as well as pitching for its own business.
"Clearly the trend is toward separation," Sampson said of media houses.
But separation is not without perils, agencies said. The further you move media planning and buying away from the creative and production process, serving clients becomes more difficult, Sampson said. "At the end of the day, it's basically clients who determine what way the media will go."
Perception is another problem facing the emerging media house sector. Polish advertising agencies may hesitate to go to media planners because they are perceived as companies that only do the buying, Slade said. In fact, the best way for a project to be effective is if the creative agency, media house and client all work as one team.
