By David L. Smith, President/Media Director; Mediasmith, Inc.  smith@mediasmithinc.com

While not the sexiest of issues, this is one of those areas that make handling Interactive media incredibly expensive for an agency vs. doing traditional media. For example....

Sequential Liability
Sequential liability has been followed by a number of agencies for years. Version 1.0 of Interactive Insertion Order Terms and Conditions is the first time that the industry has endorsed this procedure on a broad-scale basis. This means that the sites are willing to accept that the client, not the agency has financial responsibility for media payment. And I'm sure that when sales executives sign off on an agency's T's & C's, they mean to keep their part of the agreement. But we have not gotten agreement from the finance and operations people at the sites and networks. The result, for most vendors, is that our agency has a combined account for all clients, even though the clients are responsible for payment. So, when one is late for payment, all are penalized.

Statements
Even with all clients on a single account, some simple practices could be implemented to ease an agency's pain. The biggest of which is sending out statements. Now, to me, it seems amazing that companies who have spent 10's of millions of dollars on targeting and ad serving technology (you know who you are) cannot spend $50-200,000 on a billing program, but this is apparently out of the question. Even QuickBooks can send out billing statements. Why do we need monthly statements after bills are sent out? It will get a site paid more quickly. Lots of things on the agency side can happen to cause a bill to be late. The agency could have forwarded the invoice to the client for payment and not know the status. The agency could have had turnover and the invoice not "logged in" properly. And it is possible that the mail never got there in the first place. These are certainly not a site's fault, but a simple statement would help each of the last situations get escalated for payment consideration in most agencies.

Internal Systems
The sites are not the only ones to blame here. Few sites or agencies have internal order tracking systems. The result, when we do have a discrepancy where the invoice does not agree with the original order, most sites cannot resolve it, as they don't have a system for tracking the agency's original insertion order. Many site systems were built assuming that agencies would sign the site IO. Which now most everyone admits was a mistake, but this problem remains. On the agency side, the biggest housekeeping system, Donavan, has yet to develop an Interactive module for its agencies. As Donavan is the system used to track the majority of agency media business, the agencies are without financial controls too. Few have built their own internal systems and many are still using Word or Excel spreadsheets to mimic the IO process, but with no tie-in to financial controls systems.

Additionally, each side needs operations people dedicated to post-order issues. Someone between finance, sales and technology (tracking) that has all of the information and can resolve discrepancies readily. True, the agencies really don't need this kind of system in place for print, but there is something similar in place for most agency broadcast situations. Few sites have the right operational infrastructure to support advertising after it is sold. The result is that when an invoice is discrepant, whether it is for surface issues such as correct liability recognition or whether it is for more substantial issues such as different dollars or impressions vs. the order, there need to be better systems in place on both sides. Couldn't this be a business if Donavan does not want to get into it? Not as much sizzle as a new targeting engine but something that everyone in the industry needs.

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