Outdoor Advertisers Seek More Clarity Over Commissions

16 March 2006

The Incorporated Society of British Advertisers has welcomed moves by specialist outdoor ad agency Gen Outdoor to work on a fee basis, rather than the traditional - and frequently complex - commission structure.

ISBA director of media Bob Wootton is calling for more clarity in the commission system which, he claims, can be "murky".

Current practice is that all outdoor advertising expenditure channelled through a media buying agency entitles that agency to a commission of 15%.

However, if a specialist outdoor agency is employed, an additional 5% is levied from the site owner; while at the year end specialist shops also collect a further 5%-8% according to the volume of space bought.

While the 15% media agency commission tends to be returned to clients, what happens to the other commissions varies widely.

Gen Outdoor is offering major advertisers a saving of up to 20% on their outdoor budget each year by reinvesting money that would normally be returned as commission.

Comments Wootton: "The arrival of new competitors is welcome, and the arrival of a new competitor with a different business model is particularly welcome, because it will give advertisers more choice not only on who they place their business with, but the terms on which they have their outdoor done."

Data sourced from Media Week (UK); additional content by WARC staff