What’s New in the Media Industry for 2024 

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CHRIS ELMORE

Hi, my name is Chris Elmore. I am Avid Exchange’s Chief Evangelist and I’m the host of the Net30 podcast. On the Net30 podcast, we meet with industry leaders to unpack problems and solutions and talk about innovations that are impacting financial professionals. The best part about this, we’re going to do it all within 30 minutes.  

So let’s get into it. 2024 is going to mark a pivotal year in media. And because of the Olympics and because of the election, it’s anticipated that dollars spent for streaming media is going to hit a record high. And digitization will fuel innovation, efficiencies, and even help advertisers target markets using data analytics. 

And our good friend, AI, it’s going to shape the way that advertising is going to be more and more personalized. So today we’re talking about media. I’m joined with Teresa Contario. She is the VP Business Line Executive of Media. Teresa, how are you?  

01:17
THERESA CONTARIO

Oh, great. Thanks for having me.  

01:19
CHRIS ELMORE

Now, before we get started, can you tell folks a little bit about you?

01:23
THERESA CONTARIO

My history in advertising and media goes back to being an intern. Right outside of Capitol Hill, um, helping to figure out what Google and Facebook was for advertisers, right? So, I was kind of entered, entered into the media space when all that, all that social media was just on the cusp of, of rising. Is this even necessary for our brand? 

I’ve been on the media buying side. And for the better part of my career, and then that’s really what’s helped me, you know, inform and helped me to, um, educate media agencies about how to better their, their internal processes. Cause I sat on both sides of the table.  

02:08
CHRIS ELMORE

All right. So what trends are you seeing in media for 2024? 

02:13
THERESA CONTARIO

Yeah, look, 2024 is, is, uh, gonna be, again, cause we do this every single time we have an election, it’s gonna be the record setting election. Right. Uh, thanks Citizens United, right? Um, so it is gonna be record setting spending happening. Uh, we also have the Olympics coming in full swing. So it’s gonna be a really interesting year, um, on the advertising side. 

02:38
CHRIS ELMORE

Absolutely. Now, we’ve identified three things that I wanted to talk about today. So we’re going to talk about advertisers shift to digital. We’re going to also talk about data and how it’s becoming more critical. And then lastly, talk about something, you know, near and dear to our collective hearts. We’re going to talk a little bit about, you know, how to manage and deal with requests for extended payment terms.  

So we’re going to start with. With advertisers shifting to digital, so it’s true that traditional broadcast advertising dollars are, have slowly been shifting over to more streaming, more digital. They think that in 2024, it’s the, the common notion because of the Olympics and the election, it’s going to be a big year for, for streaming. 

Walk us through a little bit about where the media industry is as it pertains to digital advertising.  

03:30
THERESA CONTARIO

It’s been a decade now that digital has sort of been trying to, to make its form, uh, within the advertising industry. And now it’s a, it’s absolutely a, a necessary part of every single media plan, but it wasn’t like that always. 

And similarly, like. You know, what do they say in sort of the more the more formal business world? You’re never going to get fired for hiring PwC, right? Like, you’re never going to get fired for for choosing something safe, right? And so I think that’s why it’s taken the industry a really long time to move money where the viewers and the eyeballs are. But I actually have a quick stat according to Ad Impact, 53 percent of all political spend went to broadcast linear. I think that’s still true, that a majority of the ad spending in the political space is still going. To linear broadcast, even though the eyeballs have definitely shifted to streaming, definitely shifted to digital linear broadcast. 

04:31
CHRIS ELMORE

Is that not where the candidates think their target market is?  

04:35
THERESA CONTARIO

Well, it’s where they can see themselves. So that’s, that’s a safe bet, right? Sometimes it can also be those, those where we just saw in, um, 2020, uh, what was it, Bloomberg and Trump bought Superbowl ads. Right? Nobody buys national ads for political. 

They’re all buying very locally focused, right? And so we’re finding that, you know, I think there’s some more infiltration, call it, of these larger standard holding company advertising. companies who are getting a hold of some of these political campaigns and trying some new things out, uh, making it more like a brand advertising mission versus a candidate advertising mission. 

05:20
CHRIS ELMORE

So you said digital is where the eyeballs are. Are there, are there other factors that are pulling ad dollars towards more digital?  

05:28
THERESA CONTARIO

Most of these campaigns spend a lot of time and money trying to figure out where their swing voters are. So data can lead you to the exact person that not only you, that’s where their eyeballs are, but we also know that they’re more likely or, or could be likely to vote for your candidate. 

05:47
CHRIS ELMORE

So how are agencies having to deal with this?  

05:50
THERESA CONTARIO

Basically, I think you’re gonna layer on data to any digital Advertising campaign, and I’m going to leave. I’m going to leave targeting and I’m going to leave creating the perfect ad plan to the agencies, right? That’s their expertise. But I want to say that data in general, or data hygiene in general should be more of the agency’s mission at this point in time, right? 

It should be something that an agency understands. They should have an in house analytics team or. Find someone they trust that has an analytics team data. As we know, even from, from our business line, right? Not just, not just focused in advertising, but focused in, in finance data is king. Data is the most important thing you can have in order to find efficiencies and, and find where you can. 

Focus on to make more money as a company and a business.  

06:47
CHRIS ELMORE

What do you mean by data hygiene? That’s a, that’s an interesting term. 

06:49
THERESA CONTARIO

I remember the days where it was Excel files of lists, right? Of, of people that’s, and I, and sometimes it still is Excel documents of data that we’re looking at and that, and that’s fine. 

Excel is a whiz and I love it, right? Like I couldn’t survive without Excel, but let’s layer on. Uh, analytics on top of it. Let’s layer on programs on top of it to read and sift through the data in a way that a human can’t. And that’s going to spit out insights to us that, you know, I don’t think it necessarily needs to take a team of people to do. Here’s what I say to the agencies, you know, again, leaving the media planning and buying to them. That’s what they do best. I formally did that, of course, but like that, that isn’t where I’m, I’m focused today. So I’m going to leave them, you know, that, that piece to do, but they’re so focused. Every agency is out there saying we have the best in class, newest, latest, shiny thing. 

We’re innovating. You’ll look at the back of the house. Are they innovating at the back of the house? Are they innovating within the organization? So all this shiny, flashy RFPs saying they do the latest and greatest, but if you look at the back office, if it’s not clean and pristine and they’re not using automation, right, there’s something to be thought about there. 

08:16
CHRIS ELMORE

So let’s talk about the back of the house.  

08:18
THERESA CONTARIO  

Back office function, right? It’s, it’s efficiency. It’s automation. It’s using platforms to ingest your invoices, right? Or read your payments instructions to better facilitate maximizing how those payments get sent out. We want as many things to be electronic as possible. 

It’s possible to upload a hundred thousand line payment file and have that sent out. To all of your suppliers within four minutes. Why aren’t you taking advantage of something like that? Why are you hiring people to do that job at this point? Right? So those are just little examples of things that agencies could be doing to improve the workflow of the back, the back  office. 

09:02
CHRIS ELMORE

Teresa, you’re suggesting a brand new RFP, you know, go look at the back office and if they’re truly innovative.  

09:08
THERESA CONTARIO

We do have a number of consultants within that can manage brand reviews, right? So when, when a brand is looking for a new agency of record, some of our consultants have said they’re starting to look at operational efficiency of the entire agency. 

Billing is a major piece of this, right? So major brands, you know, can’t spend time Looking through a matching line items of whether or not what they decided they gave approval for, for an ad buy, did it run right? So a lot of that stuff has to be automated at this point to make sure that, you know, the company is at the standards that the brand is running  at. 

09:50
CHRIS ELMORE

What do you think is stopping people from, because it’s. Clearly, you and I are on this automation thing, so it makes sense to us, but not everyone’s on board yet. And do you have a sense about how many groups are and how many groups aren’t, and why do you think they’re not?

10:05
THERESA CONTARIO

Well, I will tell you, I run a sales team and we are very busy, so we’re busy because people aren’t doing it yet. 

I think it’s tradition. People generally get into a rhythm of how they’re comfortable performing their day to day operation and, and job, frankly, and they aren’t looking around for, if I automated This task, right? I don’t like if they did or they took 20 seconds to Google it They’d find solutions, but I think people are just heads down trying to get their work done, right? 

I’m crunching to the end of q4 or our books are closing now They’re their mind is less about how can I automate this for the next audit process, right? Or you know that it so I think it’s tradition and I and I think it’s just a lack of knowing that it it is Available to them. So the thought is A lot of things are moving to digital. 

11:01
CHRIS ELMORE

We anticipate a big year in the digital space. That’s right. And so that just means more data. With all of the information, and because of analytics and our good friend AI, this whole notion of, Hey, I have your size right now and it’s only 25 if you want to get it now, is becoming more and more of a reality. 

The question is In, in what ways are media companies using data to, to collect information to improve their business?

11:34
THERESA CONTARIO

It’s a broad question that I think we could probably talk about for another whole 20 minutes, but in what ways, I mean, exactly what you just described, right? You know, your buying behavior, your search behavior, um, all of that is being compiled into a profile. 

Look, I, I reject the notion that. Somebody is looking at Chris Elmore’s exact profile and targeting you directly, and that’s what I think gets everybody’s, you know, uh, right, uh, uh, goosebumps standing up about, right? That, that’s real creepy, but there’s technology doing that, right? It’s, it’s, if, then statements, um, again. 

Within, within programming, that’s helping to serve up ads and most relevant ads to those customers and to voters. So I, I think it’s just making it so that the content is more relevant for a user and you see it. Every day, when you’re searching, right? And we’re watching whatever it is that you are watching. 

You see ads that you just spoke about 20 minutes ago, right? You see some of that happening. No, it’s true.

12:48
CHRIS ELMORE

Personally, I don’t care about that. That doesn’t bother me. If someone wants to target me specifically, I’m actually okay with that. The question I really want to ask is, There’s more and more data, but are these media companies, are they thirsty for the data? 

Are they, are they wanting more types? Or are they just reacting to what everyone else is doing and, and just trying to Hang on to the fat of the day.  

13:19
THERESA CONTARIO

I think that every person is gonna react differently depending on the mood that they’re in or the content that they’re viewing at the time So these quote unquote companies right who are doing this as you’re as you’re sort of describing them I mean, I think Everybody’s trying to figure out what the unique, you know, sequence is per customer, per consumer, to, to elicit a reaction from that person. 

That’s what everybody’s trying to do is to get more and more targeted, you know, to try to, to try to rise in a reaction. It makes sense.

14:02
CHRIS ELMORE

All right. Let’s talk about like financial data. So what tools are folks using to maybe collect more financial data? Yeah. Yeah.

14:09
THERESA CONTARIO

The data that, that, you know, we, we have on our side, um, is, is payments policy data. 

Suppliers have different policies from which they will decide whether or not they will take a certain payment method, because on their end, it might cost them something. to take various forms. So an ACH costs them a certain amount, or a check goes to a lockbox, the lockbox costs them money, or do they take a credit card, it costs them a certain amount of merchant fees. 

Based on that, they put different conditions against payments. And so Some of the, uh, information that can be collected and that some of the information that we collect and our, our customers can take advantage of is payment policy information to better inform how we route those payments to their suppliers and, and we manage that. 

The other, uh, information that is relevant to these. agencies or to our, our customers is the number of times you send a payment to a supplier, or the remittance information that can be sent to various folks at a supplier to make sure that everybody along the food chain is informed that a payment has been made or a payment is on its way. 

We have actually in the, the political space, it tends to be cash in advance. So there’s a whole different political workflow, um, for those payments where everybody needs to receive cash in hand before an ad is run. So the types of data exchanges that is happening there is, is, you know, everything from how does a supplier want to get paid to forwarding or being responsible for distributing remittance details and data to those end suppliers. 

16:03
CHRIS ELMORE

I assume that people in, in agencies or, or just in media in general, you know, have folks that are working on these tasks and then you now have the ability to collect it in a more meaningful way. Are people running towards that solution or is it taking them time to kind of figure this thing out?  

16:21
THERESA CONTARIO

It’s hard to explain the value of something like that, because again, people have been doing it one way for a really long time, right? 

So, until you start seeing the engine at, at work, and you, you kind of test it, then you, you understand its value a little bit more. But once our customers tend to use it, they, they’re stuck. It’s really an efficient method and it, it takes, in my opinion, an unnecessary task off of someone’s day. And they can focus on the big picture things. 

16:58
CHRIS ELMORE

So let’s talk a little bit about managing requests. So the exact, the exact quote is managing requests for extended payment terms. Apparently, you’ve, you’ve schooled me on this thing, but apparently, the standard’s 30 days, but there are some organizations that are, are putting pressure on folks to go 60 days, 90 days, 120 days before they get paid. 

So just lay the groundwork with this thing and then Talk about the way that you see all this payment term extension.  

17:30
THERESA CONTARIO

So in the advertising space, there is a concept of sequential liability, sequence of liability. So an agent sits in the middle. They contract with the supplier on behalf of a brand. The brand, when they contract with the agency, is asking for their own payment terms. 

So 30, 60, 90. In recent year, we’ve seen an RFP go out, um, that was requesting an agency take on 365 day terms. Then, the sequential liability then basically says, until I get paid. My clock doesn’t start with you, supplier. So suppliers who have entered the advertising ecosystem, if they’re older players in the advertising space, they understand this. 

If they’re newer, talk about innovation and talk about stifling innovation, they may not understand this completely. They have negotiated a contract with an agency and they believe they’re to be paid So the four A’s recently came up, came out with, um, an opinion, a white paper on the topic of extended payment terms and the ripple effect of these extended payment terms that it has on our industry and our business. 

18:50
CHRIS ELMORE

The thing about any any big financial change is the ripples that I’m, I’m, I’m glad that we’ve got a white paper on the ripple effect.  

18:59
THERESA CONTARIO 

Ripple effect. That’s right. We actually sort of surveyed all of the industries that we have and media on average, our days outstanding, our days of invoice, uh, from invoice to pay is 86 days. 

Whereas most other industries are below. 50 days, 40 days. They’re in the 30 day range because that makes sense. That’s what they’ve contracted for. So the media space is very unique. It has this huge, if you see a bar graph, it has this huge, uh, upswing when it, when it shows your media, um, line, right. Which is, which I just find really interesting. We’re in a really interesting ecosystem here. So I want to read a quote, if you’ll let me, from the white paper, which like I love reading it cause it gets me really fired up because I, I actually, a couple, maybe it was like, Just over a month ago, I was at, I was at an event in front of a number of CEOs of agencies and in, and just to get their attention, I just screamed, you are not a bank. 

And all of them kind of stopped and they were like, I believe that is true. Yes, I am in, I am an agency, but it resonates, right? Because they all are being asked to take on financial liability far beyond their means. So let me read this. “There is nothing standard about a 120 day term for an industry that relies on the important task of balancing payments to media suppliers, production companies, and meeting their own business requirements. 

Anything beyond a normal 30 day cycle is incompatible with the typical agency commercial model and particularly destructive with zero, with respect to zero margin pass through billing, forcing agencies to act as banks. to their usually better capitalized and profitable clients.” I just think that’s it, summarizes it.

20:57
CHRIS ELMORE

Just so folks listening can understand the connection between you telling folks that they’re not a bank and extended payment terms, can you connect those two dots for us?  

21:07
THERESA CONTARIO

If they’re asking for extended payment terms, who’s going to pay the suppliers on time? The agency. Yeah. And if you’re, if you’re floating money to a supplier, that makes you a bank. 

There’s actually a pretty large industry just focused on that, right? It’s called banking. It’s called finance, right?  

21:29
CHRIS ELMORE

I have my own hypothesis on this. These extended payment terms are because I think because they can do it. What’s the reality? 

21:40
THERESA CONTARIO
That’s untrue. They can’t do it. They can’t do it so they’re, they’re taking from another place and funding it. 

They’re, they’re being squeezed or worse, they’re squeezing the suppliers. And you know who can do it? The big holding companies or the big broadcasters, right? The, the big guys can sort of manage not getting paid on time. Who can’t handle it are the smaller, independent, minority owned shops, the smaller, independent, minority owned, uh, radio stations, et cetera, right? 

They, they don’t have the capital to support this. So it, again, again, I go back, we’re this industry. that strives for innovation for the most creative creative. We’re the ones who are out here talking about how to maximize targeting your, your audiences. And again, as you follow the chain all the way back, there’s some, some pretty interesting business practices being managed and no other industry. Is acting this way? Uh, why is that?  

22:49
CHRIS ELMORE

Any idea?  

22:50
THERESA CONTARIO

I think that media, because some of it is intangible, ends up being commoditized. I think that’s, that’s the best, you know, answer I can come up with for this. Because even the same brand who’s asking for this from their agency, they’re not paying their rent late. Or the utilities. 

They’re not paying, you know, for office supplies late. They’re paying in advance for a number of these things, right? But, but for media, we’ve like set a precedent that you can pay after the, the media has run or that the, the deliverable has been given to the, to the customer. And sometimes in a media plan, it takes months or a year for the full media plan to run. 

Right? And so I think we’ve kind of set this precedent that. Wait until we see how your campaign performed and then you kind of owe us the money. It’s still marketing and advertising at the end of the day should be paid as you would pay for any other service.

23:48
CHRIS ELMORE

Do you suggest that they push back? And if so, how would you do that? 

23:52
THERESA CONTARIO

They lose the business. That’s if they question it, right? They, they lose the opportunity at the business. I mean, even the big holding companies are, are they, the brand looks for an agency of record. Who’s going to support. their 2024 brand campaign. They’re looking for the coolest, newest way to, um, target, target their audiences or to increase sales at, at the, at the end of the day, when you’re sitting there going through the RFPs brand, they say, you know, what would really help is if we didn’t have to pay this advert for all this budget right out. 

Right out, uh, of our pocket. If we could wait a little while, that would help us make our decision. And they’re choosing an agency based on whether or not the business terms are right. Not because of the quality of the good they’re buying.  

24:44
CHRIS ELMORE

Is there anything that they can do about it, or do you have suggestions on pushing back? 

24:48
THERESA CONTARIO

The 4A says, just don’t accept any other payment terms outside of 30 days. Easy to say. Exactly. And it’s, and it’s easy to say and it’s easy to say depending on the brand you’re trying to win. If somebody else, if your next door neighbor’s gonna do it, you lose the business. So the entire industry has to just decide today. 

That’s how we’re going to get paid as an industry, but there’s already a precedent set to, so to change that will be, will be pretty tough. It comes from the holding companies. If the holding companies stop doing this and stop demanding this, then the bigger brands can’t get away with it. Are there any other options? 

Yeah, you just don’t take that business either as an agency, right? That’s why I screamed into the audience, you’re not a bank. So also it’s your fault if you take on a customer or a brand who doesn’t fit the, your internal business model, right? You, you are going to have to deal with that as well. So if they don’t respect what you’re doing enough to pay you. 

On time for it, then I would probably pass on that business anyway. You’re going to be just fine. Teresa.  

25:58
CHRIS ELMORE

Thanks for all your wisdom. I completely agree with you. 2024. It’s going to be a very interesting year for many reasons. To kind of close us out today, if there’s one thing that you could tell listeners, what is that? 

26:14
THERESA CONTARIO

Listen, the advice that I want to give to agencies is bring the innovation that you’re putting forward in your pitches, your new business pitches, bring that all the way through the agency, even to your billing process.  

26:28
CHRIS ELMORE

That’s great advice. Teresa, thanks so much for joining the show.  

26:31
THERESA CONTARIO

Yeah, thanks for having me. 

It was a pleasure.  

26:34
CHRIS ELMORE

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