K2 Rebate Collection Report Highlights Need for Better Agency Production and Financial Platforms

Posted by Chris Hering, Vertical Marketing Lead for Advertising, Media and Publishing, NetSuite

The recent report from the Association of National Advertisers, which found that rebates, including "cash rebates," and "other non-transparent practices" are pervasive in the U.S. media buying ecosystem, stirred up more than just specific worries on media, it hurt the relationship between brands and agencies. It's a relationship that is often strained in the face of discount-oriented procurement officers and margin-owning client finance agency resources. Inevitably, the report will raise more questions of how to manage the balance between building relationships and margins or profitability.

When we meet agencies tracking client work on old systems with manual overrides and on-premise limitations, I wonder if they’re tempting fate by hoping the brand won’t actually see the controls in place. Lots of 1990’s- and 2000’s-era time tracking software are sitting out there that are disconnected from client profitability and resource utilization. It's a lot of unnecessary risk to the business. These systems lead to budgets that are busted before PM’s or RM’s know it and the creation of unsound incentives to shuffle work around. This opens up a box of worry for any audits that may emerge.

Investment in a central system to proactively alert account leads and project manager BEFORE an overage becomes a substantial issue is a far better approach. NetSuite’s real-time Project Center Dashboard updates the right team on where planned vs. actual burn sits and where out-of-pockets are against their budgets. This means PM’s can have intelligent conversations with their clients about the impact of their change requests and also manage their internal teams to budgets effectively. Internal transparency isn’t created equally, which means that different roles need to have different access at different times.

Building trusting relationships with clients and brands is hard. Balancing your margins with the right level of attention with your customers is easier when expectations on deliverables are aligned and your internal teams know their own goal posts before they hit them. Creativity is hard enough without metrics being a guessing game as well. NetSuite’s in place at leading agencies helping to maintain that balance.

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