Media Agencies: HIGH STAKES, BIG JACKPOT

Battle tested overseas, optimizers have hit U.S. shores. Will media buying ever be the same?By Cristina MerrillNobody will say exactly what 'it' is, but if you want to come across as a cutting-edge, techno-driven, cost-efficient media buying operation, you'd better say you have one.What is it? An optimizer. Like account planning--an agency discipline imported from England to the U.S. on a large scale in the late '80s and early '90s by many agencies but initially understood by few--the optimizer is another European import. While media executives probably see the optimizeras a tool that will strengthen their hands in the head-to-head media poker game played with the competition, the descriptions of these optimizers are general and vague, much like how account planning used to be described.Unlike flesh-and-blood account planners, the optimizer is a software program that will make U.S. media buying and planning more effective, efficient and economical, claim the agencies that will be spending millions to develop or to license it. Available in Europe since the early '90s and recently exported to Asia, this tool is just now being implemented in the U.S. Like many agency initiatives, it is client-driven.'Unilever and Procter & Gamble are demanding that their agencies have optimizers,' says consultant Steve Perry, the pioneer of optimizers, who is now the owner of London-based SP Consultants. 'It's a fundamental tool for which there is no substitute. In fact, it's a big disadvantage if you don't have it.'Simply put, optimizers are sophisticated computer-based programs that manipulate real-time audience measurement data to sharpen planning and buying of television time. These strategic planning tools, which advise how to best spread media dollars in order to maximize coverage, are slowly making their way to the U.S.Crucial to the workings of the optimizer is the real time--or raw or 'single-source'--data from A.C. Nielsen, which in this country is tracked by both Nielsen Media Research and A.C. Nielsen, formerly part of the same company. Typically, planners in the U.S. use formulaic and now outdated reach-and-frequency Nielsen Media Research models from 1989.In Europe, the data is easily made available and, given the smaller size of the market, easier to get. '(Europe's) media landscape is so much simpler than here,' says Page Thompson, U.S. media director at DDB Needham, New York. 'It's a lot easier to do (overseas).'So easy, in fact, that Europeans have made use of optimizers since 1989, when Perry was called by Lintas to help develop a computer-based TV audience analysis system for Unilever. Since then, Perry has perfected the system, which is now widely known as X*Pert and used in 33 countries. Major users even include media companies in Turkey and Hungary. Lately, X*Pert has gotten some competition from another product called Super Midas (backed by WPP agencies J. Walter Thompson and Ogilvy & Mather) and most recently, from Spot On, developed in Australia, which has already won rave reviews.'It looks like you're in the cockpit of a Concorde with this thing,' says Kevin Malloy, global client media director at MediaVest, Darcy Masius Benton & Bowles' global branded media network, who described the tool at a recent media conference. 'It draws graphs, it's got a clock that tells you (how quickly) it can analyze 80,000 schedule combinations a minute.'Because Procter has been a major optimizer user elsewhere in the world, sources say there is a huge incentive for its roster shops or any others vying for its business, to get familiar with the gadget. That's most imperative now, since the global company is pondering an upcoming $1 billion television media buying review.As a result, a handful of agencies--Procter shops like Grey, DMB&B and Leo Burnett, and others like Saatchi's media arm Zenith Media, J. Walter Thompson, DDB Needham and McCann-Erickson Worldwide with multinational clients--are rushing to research, buy or develop their own systems in this country.Perry says most of those agencies have called him asking for exclusive rights to X*Pert. Although Perry himself declines to discuss it, sources say Zenith Media has procured exclusive rights to X*Pert in this country through December of 1997. Signaling its commitment to the new software, Zenith is also branding its optimizers under the name of Zoom (Zenith Optimization of Media), a fact that the company is touting in its upcoming 1996 annual report.Sources say Grey also uses X*Pert in most parts of the world, while WPP's agencies have first-time exclusivity to Super Midas products and Leo Burnett has looked at Spot On.McCann-Erickson is also in the process of introducing its U.S. version of optimizer, McOpt, to clients. McCann's is a broadcast TV daypart optimizer that calibrates proprietary reach curves within close range of Nielsen's and churns out 20,000 schedule combinations in a matter of minutes. It does not use Nielsen's raw data.'Smart planning can save as much or more than tough negotiation,' says Mark Stewart, senior vice president and media director at McCann.DDB's recently unbundled Optimum Media, named after its optimization focus, recently developed a custom software tool that measures viewer loyalty. OnCore, as the optimizer is known, uses actual Nielsen minute-by-minute TV ratings information to determine the core audience for individual programs on national television for 18 different demographic targets. Owing to OnCore or not, Optimum has recently won several pieces of business, including most of Mobil Corp.'s $60 million media account.Agencies swear by these optimizers. Jim Bell, managing director of MediaCom Worldwide, Grey Advertising's media international subsidiary, says the first year his company used the tool in China, MediaCom reached the same audience with 40 percent less money. Typically, optimizers save a lot less overall, but when dealing with billion-dollar budgets, that translates into huge savings.But even ardent fans of the optimizer warn against over-reliance on it. Paul Woolmington, executive vice president and worldwide media director at Ammirati Puris Lintas, stresses the need for consumer, or qualitative, studies that help the planner and buyer understand the audience. That direct contact with consumers will preserve that 'gut feeling' every good media executive needs when making decisions.'Technology is good if it's an enabler,' says Steve Heyer, president, worldwide sales, marketing, distribution and international networks at Turner Broadcasting. 'At the end of the day, there is an emotional attachment between what we produce and the audience. How you put that into a machine is an interesting question.'And optimizers don't come cheap. Agencies spend in the millions to develop or purchase the rights to their own systems. DDB's Thompson is quick to add that getting Nielsen's raw data here is the 'toughest thing' about getting one's optimizers in place: It takes time and it is expensive--Nielsen charges an estimated $150,000 a year for the data.Many agency media directors say they didn't realize the Nielsen data is even available or complain it's a hassle to obtain. Industry insiders are at loss in explaining why Nielsen is proving so difficult at releasing data that's already widely available in Europe. Some explain it by saying that, until recently, there has been no real need for current data, even though some rough TV optimizers existed in this country a couple of decades ago and print optimizers are widely used; others call it a Nielsen conspiracy.'Nielsen probably wouldn't want to release too much data,' says SP Consultants' Perry. 'It used to be worldwide policy for a long time not to let anyone get near their data.' (Nielsen representatives did not return phone calls for this article.)With or without Nielsen's help, media research is already marching on at a brisk pace and typically coming from abroad. 'I don't think our research is as consumer-focused as in Europe,' says DDB's Thompson. European companies like London-based Carat--which devotes millions to media research every year, sources say--have developed sophisticated, 'upstream' systems that combine research, awareness data and traditional ratings and sales information to analyze and predict advertising's effect. Moreover, Carat North America recently acquired the leading such company in the U.S., Wilton, Conn.-based Media Marketing Assessment. MMA has been using analytical consulting services to evaluate marketing and media campaigns for such packaged-goods heavy hitters as Kraft Foods, Campbell Soup Co. and Kellogg USA.'In our business, we're looking narrowly at advertising,' says Stig Karlsen, president of Carat North America. 'An advertiser needs the best in creative and in media. A dinosaur can't offer that,' he quips, referring to full-service agencies.But whether they want to or not, agencies are going to have to take a look at the newest technologies and then decide for themselves. 'It would be foolish for any agency that's part of a network not to see if it works here,' Grey's Bell says, although he warns against betting an agency's fortunes on it.Copyright ASM Communications, Inc. (1997) ALL RIGHTS RESERVED National

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Media Agencies: HIGH STAKES, BIG JACKPOT

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