Did the pitching landscape undergo a seismic shift in 2023?

Delving into the intricacies of the pitching process, 2023 emerges as a transformative chapter in the annals of the advertising and marketing industry. In a remarkable turn of events, industry titans such as ISA, IBDF, and AAAI collectively ventured into a realm that had long been marred by persistent challenges. Unlike previous years, characterized by prolonged grievances and passive discontent, 2023 witnessed a paradigm shift. Industry leaders decided it was time to cast aside the shackles of routine complaints and proactively initiate change in the way pitches are conducted and decided.

As we bid farewell to the year, we bring to you three significant developments of 2023 that are poised to reshape the media landscape, redirecting attention from pricing towards the core elements of talent and service excellence.

ISA's Bold Move: Unveiling a Transformative Media Charter in 2023

In August 2023, the Indian Society of Advertisers (ISA) set the stage for industry-wide reform by introducing a comprehensive media charter. This strategic initiative, while causing ripples of surprise across the sector, was more than just a set of guidelines—it was a direct challenge to advertising agencies, urging them to embrace heightened transparency in their operations.

Among its various stipulations, the ISA's charter made a resounding call for "Contractual Clarity," emphasizing the importance of signing contracts before the commencement of any collaborative venture. This was not merely a bureaucratic formality but a declaration akin to saying, "Let's maintain transparency and clarity from the get-go; after all, we're all allies in this endeavour." The charter also insisted on comprehensive documentation, leaving no room for ambiguity and ensuring that all aspects of the collaboration were explicitly detailed.

However, the centrepiece of the charter was the demand for financial compliance, echoing the need for regular audits to ensure fair play in the financial landscape of the industry. The call for transparency resonated in the quest to reduce ad fraud and elevate brand safety standards, addressing critical issues that had long been a thorn in the industry's side.

The unexpected jolt from ISA's charter caught many stakeholders off guard, sparking a crucial conversation within the industry. Seizing this moment to air their grievances, the Indian Broadcasting Foundation (IBDF) promptly entered the fray, urging agencies to reform their practices during the pitch process.

IBDF's Tough Stand

Come September 2023, IBDF stood up for itself, sending a clear message to the agencies that it had had enough of them playing with TV channel rates during pitches. It was time to lay down some ground rules. A notification was sent out asking for a declaration for agencies to sign during pitches, ensuring rates are not committed on behalf of the broadcasters during the pitch process.

Before this development, industry experts asserted that agencies often slashed the rates charged by broadcasters in an attempt to win over brands. Insiders have confirmed that the directive was meticulously adhered to in all pitches held after September. At present, a few pitches are on and the directive was followed religiously by all the agencies.

Wake-up call for Agency ecosystem

Back-to-back messages from two leading industry bodies finally shook up the agency ecosystem, which, in a first, came together and finally consented to make certain rules for themselves to ensure brands do not exploit them and push them into reducing the rates further to win the business. Over the years, the agencies suffered a lot in terms of reducing their commissions just to win businesses.

In a rare occurrence this year, when a big brand called for a pitch, two big agencies refused to participate as they found the pitch to be driven by price and not service quality. Feeling the winds of change, the agencies finally united to take a stand for themselves. In a first, they have drafted guidelines putting a cap on agencies dropping rates below a certain threshold during pitches. The cutoff for the minimum rate is based on the size of the account.

Anticipating the Impact in 2024: Lights, Camera, Action!

The move can be a game-changer for the industry. These reforms are expected to put talent and service quality back into the spotlight. Minimum thresholds for rates are the new guardrails, ensuring fair compensation for agencies and fostering an environment of sustainability.

As the curtains fall on 2023, everyone's eyes are on the sequel – 2024. Will agencies and brands stick to the script, or will they improvise? The industry's ability to resist short-term gains and prioritize long-term sustainability and excellence will define the plot. The advertising industry stands at the edge of meaningful change, and as it steps into 2024, the spotlight is on. Will it play by the new rules, or will it be left behind in the dust of change? The stage is set, and the advertising juggernaut is on the brink of a new era. Let the show begin!