Short-term deals are norm in media

22 September 2004
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23 September 2004 | David Arminas

About 42 per cent of media and creative contracts are assigned for less than two years, according to a new survey.

The report, from advertising agency Abbott Mead Vickers BBDO and sponsored by CIPS, also found that 42 per cent of purchasers were involved in the contracts all year round.

The downside is that the short-term two-year contracts do not allow the development of long-term relationships, said Emma Nussey, commercial director at the agency.

"This sort of contract ignores all of the time and money both purchasers and agencies have put into the initial contract," added Nussey, who spent four years at procurement consultancy QP Group and nine years in procurement with BA.

"Most of the agencies are small companies so constant re-tendering is damaging financially."

But she told delegates at CIPS's annual marketing and purchasing seminar that the high percentage of purchasers involved in agency contracts all year round means that in many cases someone is watching the relationship, which is good for procurement and for the agency.

Satisfaction remains highest among purchasers of media contracts, for which 65 per cent said they got value for money and 35 per cent said not.

The figures are reversed for buyers of creative services, where the majority, 56 per cent, said they were not getting value. Forty-four per cent felt they were receiving good value.

The survey also found that just over half of respondents had less than two years' experience buying marketing services.

SMsep2004

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