We’ve all heard the stories countless times about big box retailers pushing out local merchants because of massive advantages in purchasing power. It’s basic economics; the greater volume of purchases allows for stronger negotiations and, ultimately, lower prices for consumers. We recently asked the question, is this same dynamic true for digital media buying? What role does size play in the savings recognized by the end customer? Our findings offered mixed results… continue
In some instances where purchases were made directly from a publisher, media buyers could leverage the overall spend to recognize certain cost savings. However, in a programmatic environment where each impression is bid on individually, the leverage of larger companies evaporates. In fact, the advantage clearly goes to the buying boutiques. With smaller and nimbler teams, the overhead associated in managing campaigns is significantly less compared to behemoth agencies or media companies. This allows for profit at lower sale prices to the end consumer.
In the end, the bigger the company does not guarantee cost savings that are passed through to the end user. Our advice is to select a partner that is transparent and will walk you through the rapidly changing media landscape.