Jared Belsky needs your help.
He’d like someone to please explain to him why media arbitrage isn’t a form of stealing, he says on this week’s episode of AdExchanger talks.
As the former CEO of Dentsu agency 360i and the current chief and co-founder of a new indie agency called Acadia, Belsky has spent a lot of time thinking about the nature (and dysfunction) of the agency/client relationship.
His conclusion, he says, is that much of the “perpetual friction” between agencies and brands is “self-inflicted” because of the way agencies have treated their clients for the past 20 years.
Belsky points to the “trading desk fiasco” as a clear example of how a lack of transparency breeds mistrust. “We were regularly making 40, 50, 60, 70% margin,” he says. “Brands didn’t understand what was going on.”
But brands should make it their business to understand what’s going on with their ad dollars.
Which is why Belsky has made it his mission to educate advertisers about the ills of principal-based buying, which is when agencies buy inventory in bulk and resell it back to clients at a higher rate to make a profit.
He even recently launched a website called saynotoprincipalmediabuying.com to help buyers get more informed, and he ran an ad campaign on Ad Age and across LinkedIn to promote it.
In Belsky’s view, agencies should act as thoughtful and transparent fiduciaries for every dollar of a brand’s budget, and clients should pay their agency a fee that both sides agree is reasonable for a job well done.
And that’s it.
“If we can get a $15 CPM for our clients, and that’s the lowest we can get, why shouldn’t we give that to them? That’s the agency’s job,” Belsky says. “Either you’re an agency or you’re a middleman. Like, are we Whole Foods? Are we buying bananas for $1 and selling them for $2?”
Also in this episode: Bringing radical candor to the agency/client relationship – even if that means having to fire a toxic client; the coffee shop conversation (and back-of-the-napkin sketch) that later became Acadia; and chaperoning the Fantanas as a Coca-Coca associate brand manager during spring break in Panama City Beach in the early 2000s.
For more articles featuring Jared Belsky, click here.
