Most people in media advertising are aware that the buy side of the industry receives “perks” from sellers. This may come in the form of a complimentary lunch or dinner, thanks to the expense budgets of the media sellers. Tickets to baseball games, concerts or ski trips are some of the nicer benefits that media agency people can also experience. In this way, media is no different from other industries like finance where client entertaining is an integral part of doing business.
Recently, though, some agencies have begun to put guidelines around the perks that an employee may receive. This is a good idea, especially for younger buyers who may not yet know how to comport themselves. Recently, when I was running a sales team, I was surprised at how aggressive some of the next generation of buyers had become. Demanding perks as a condition of taking a meeting with a potential vendor is both uncouth and wrong.
Another area with room for improvement would be the corporate “swag” that publishers shower upon agency staffers. I worked at a large media agency for almost a decade and most of the logo-emblazoned gifts I received from vendors — duffle bags, martini glasses, lava lamps, etc. — sadly ended up in the trash. This wasteful-gift giving should be cut back wherever possible.
However, it’s important that we not go too far when it comes to regulating the perks of media. Here’s why:
Relationships. Media is a relationship-driven industry, and with good reason. Our technology has become so complex that when things go wrong — as they often do — you need to know and trust the person you are working with on the other side. Given the long hours of working at an agency and servicing clients, lunches and after-work activities are the really the only time we have to get to know one another.
Fairness. The differences in compensation on the buy and sell side are significant, particularly at the entry- to mid-levels. Talented sellers can make anywhere from two to 10 times the salary of an entry-level media planner. Most sellers have their own place to live while junior planners are crammed in small apartments with multiple roommates. A planner who accepts a nice dinner out from a rep may be getting the best meal he will have all week.
Sellers can also receive stock options in exchange for working for a startup company. For example, many Facebook employees will get a financial bump thanks to the forthcoming IPO. In contrast, most agency folks never get to swim in a company option pool. Agencies are owned by a holding company that went public long ago.
Incentives. The U.S. tax code encourages businesses to spend money on legitimate travel and entertainment. Whether it’s for clients or their own employees, companies can write off a significant portion of the expense related to relationship-building. It’s good for business and good for the economy to make this kind of investment.
Anyone who has worked in media for some time can attest that not all perks are created equal. A dinner or baseball game with a tone-deaf seller who aggressively pitches his product or service late into the night can be miserable experience. Likewise, a buyer who accepts an invitation from a seller with absolutely no intention of putting his company on a plan is being disingenuous. All of our time is precious, and we should spend it building relationships with the people and companies we like and respect.
By Matt Straz
Matt Straz was a senior partner at MEC from 2002-2008. He is currently the CEO of Namely.
Courtesy of MediaPost