Magna’s Local Focus

Magna, one of the first attempts to amass buying power across several agencies, is directing that clout into radio and local TV. The IPG-owned unit that offers research and marketplace intelligence tapping the collective buying power of Initiative, Universal McCann and ID Media recently wrapped its first network radio and spot TV deals. Using a collaborative process it calls “flexible scale,” Magna placed $100 million in network radio and $150 million in spot TV. Though Magna declined to name participating clients, its shops represent advertisers including Chrysler, BMW, Home Depot, Quiznos and Johnson & Johnson. Not all clients agreed to participate in the first deals.

Magna set up two councils—one for local TV and the other for national radio—both representing buyers and media directors from each of the three media agencies. Magna president Elizabeth Herbst-Brady and Janice Finkel-Greene, executive vp and director of buying analytics at Initiative, also participate in the council deliberations. Based on marketplace intel, each shop’s local buying footprint and the individual needs and desires of each client, the council negotiates a group deal. The deals are then executed by the individual media units.

The process, adapted from Magna’s TV model, addresses the more complex requirements of planning and buying for regional and local campaigns and the footprints of the agencies themselves. “We have been working to find the right configuration,” said Herbst-Brady.

All the major media agency conglomerates have sought new ways to more efficiently buy local media, and leverage combined budgets to secure the best deal possible for clients.

GroupM restructured its local broadcast buys into two groups and more recently combined its three network radio buying units into a single organization to create the largest network radio buying shop in North America with billings of $200 million. Publicis Groupe created a buying platform called SMGX that pools applications and marketplace intel. Omnicom Media Group set up OPera, a media buying process to handle negotiations across TV, radio and other media.

Resisting the temptation to consolidate, Herbst-Brady explained that Magna’s process takes advantage of the combined budgets of each of the media shops while maintaining the confidentiality and customized buying and planning strategies that clients want. “The idea that every decision should be made at the top and then applied back down to the client brands is challenged,” said Herbst-Brady, who was brought in in 2008 to develop new ways to aggregate dollars to get better deals for clients. “It’s not a one-size-fits-all approach. It takes a bit more work, but it’s time well spent.”