Oz Media Buyers Pioneer Alliance Package Deals

24 November 2006

SYDNEY: There's safety in numbers, as all vulnerable lifeforms instinctively understand - not least the species notogaea media specialitas. Hence the present trend Down Under for media buying groups to form alliances and strike package deals with cross-platform media owners

The trend, pioneered by the A$1 billion (US$775.8m; €600.1m; £405.2m) buying alliance of Mitchell & Partners and Initiative Media, is set to be followed by Australian Media Exchange, a $1.1 billion buying power enterprise by Publicis Group that incorporates its various Australian media-buying assets.

The Mitchell/Initiative axis has already committed clients' pooled advertising funds for next year to a smaller number of media owners with multiple assets, and AME is reportedly poised to do likewise. It will brief media companies next week on its plans.

According to Seven Network sales director James Warburton, the commercial TV networks will receive "around A$250 million" in revenues this year from integrated ad packages, with another A$50 million going to group siblings in magazines, the internet and mobile marketing.

Peter Wiltshire, sales director at Channel Nine agrees, reckoning that multiplatform deals will account for "about 10% of industry revenues across TV, magazines and online.

He added: "You're probably talking about $300m at the moment and it's only going to escalate. Satisfying the appetite is the challenge for all of us."

Although the trend has triggered much debate within the antipodean agency and media worlds, the majority of clients have yet to come off the fence.

Lexus' local divisional manager Scott Grant said he remained open-minded about the Mitchell/Initiative multimedia package projects. "It's just another twist and turn in the complexity of the world of media and marketing. It's something different and we'll see how it pans out."

Data sourced from Sydney Morning Herald; additional content by WARC staff