Media Management

Three key reports every marketer should review

Breaking New Ground

“Every project is an opportunity to learn, to figure out problems and challenges, to invent and reinvent” – David Rockwell

The process around initiating advertising creative/production jobs and media campaigns is typically sound. Plans are reviewed and approved, statements of work prepared and executed, purchase orders issued, agency invoicing is generated, and work commences. 

Unfortunately, the process for tracking jobs once work has begun is less well-defined in most organizations. This can pose challenges in an industry that relies primarily on estimated billing and has become accustomed to elongated job/campaign closing timelines that often run 120+ days following the cessation of activity.

To address this situation, it is incumbent upon marketers and their agency partners to closely and regularly monitor spend levels and pacing vis-à-vis approved budgets. In our experience, there are three key reports that every marketer should ask their agency partners to generate on a monthly basis for review and discussion between stakeholders within each organization.

1) Job Cost Detail Report

For each job or campaign initiated, require the agency to summarize progress from both a fee and expense perspective relative to estimated costs. These reports should identify approved funds by category and project-to-date progress compared to the actual time and cost incurred. 

2) Fee Burn Report

Tracking agency time-of-staff investment and fees earned at both a retainer and project level provides a clear indicator of resource utilization. Understanding agency staff utilization relative to the percent completion rate for an annual retainer or individual job is critical if marketers and their agency partners are to effectively manage performance in this area.

Importantly, if hours are running higher than anticipated, both parties can make the necessary adjustments to mitigate the potential for time or fee overages.

Similarly, if projects are proceeding smoothly and the potential exists for coming in under budget, marketers can either redirect agency time to other projects or identify potential credits that could be due back upon job closing.

As well, this type of tracking often becomes the basis for estimating future work, especially if job types are recurring.

3) Unbilled Media Report

It is imperative for advertisers to track the cost difference between media funds approved and prepaid for relative to the amounts billed by the media seller and paid by the agency for media placement activity. Unbilled media occurs across media types but can be most acute in digital and can run in excess of 12% of total media spend.

Most client/agency agreements contain language regarding this area and guidelines around the timing of media cost reconciliations, the return of unspent media funds to the advertiser and the indemnification of the agency as it relates to latent media seller invoicing.  

While generating and reviewing these reports is helpful, scheduling recurring monthly meetings with each agency partner helps expedite job/campaign closings and reconciliations and significantly mitigates the risk of budget overruns or unused funds not being returned to the advertiser in a timely manner. In the words of American architect David Rockwell:

“Every project is an opportunity to learn, to figure out problems and challenges, to invent and reinvent.”

About the author

Cliff Campeau is Principal at AARM | Advertising Audit & Risk Management