In 1993, the French government introduced a new anti-corruption law, the Loi Sapin, designed to introduce transparency into media buying.
It required rate card prices to be published and invoices sent to the advertiser, even if payment was made by the agency. Media agencies also lost their status as central media buyers with the right to buy in bulk and resell to
In January 2015, the French government proposed that the phrase ‘any medium whatsoever’ should be added to the regulation, extending its application to cover online transactions.This is likely to become formally ratified in law this summer. Gaelle Simon-Drocourt, Digital Manager at Ebiquity France, considers the arguments for and against.
The French digital advertising market was worth €2.9bn in 2014, a quarter of total advertising spend. Display represents €813m, a quarter of which is bought programmatically. This means €10-15m was received by intermediaries in the programmatic chain,
a figure which will grow as digital grows. Moreover, programmatic already covers display, mobile, and so-called ‘private deals,’ and will soon incorporate traditional media too. The proposal to apply the Loi Sapin to all forms of digital media buying has split the industry down the middle in terms of how the law will be applied and to whom, centered on the issue of real-time bidding (RTB).
“In January 2015, the government proposed that the phrase ‘any medium whatsoever’ should be added to the regulation, extending its application to cover online transactions.”
On one side are the media agencies, represented by their trade body, UDECAM. They believe that media agencies are already sufficiently transparent, and argue that RTB – which includes additional services that transform the advertising space, including injecting audience targeting – should not be subject to the same regulations as other media. This new buying mode is also sold by retargeters, ad networks, and independent trading desks, none of which are subject to the Loi Sapin. Hence, the agencies claim, RTB
should have a different status: a status created and technically defined by UDECAM as “space transformer” (transformateur d’espaces).
And on the other side are the advertisers, led by the UDA (the French affiliate of the World Federation of Advertisers (WFA)), who make it a priority to ensure maximum possible transparency; advertisers want to know where spend goes within the transaction funnel. They reject UDECAM’s claims of special status, arguing that RTB transactions include advertising space, and so the Loi Sapin should apply.
Compromise appears unlikely, especially as advertisers are looking to secure substantial savings across all market segments, including retargeting and programmatic. Advertisers are not willing to pay the requested 20-30 percent agency commission, particularly because of the almost total lack of transparency. To enhance transparency, the UDA is encouraging detailed reporting to measure actual performance and quality of media buying, as well as detailed human and technology costs.
In order to improve transparency for RTB, it is recommended that advertisers ensure that the following clauses, rights, and abilities are included in agency contracts:
- Check all invoices at all stages of the chain
- Have access to a consultative account management platform and not just theclient interface
- Split the budget dedicated to media buying with the purchase of third-party data, costof tools, and trading desk fees
- Distinguish budgets for acquisition and those for retargeting and their respective results
- Monitor campaign results by network, site, or ad exchange
- Institute systematic implementation of a brand safety/fraud tool to check the broadcast environment for all campaigns
- Apply a visibility tool routinely for branding campaigns, to check the quality of theinventory