Global Brands Shift Away From Labour-Based Agency Fee Models
· 3h ago · Originally reported by VideoWeek
A recent study by the WFA highlights a trend among global brands moving away from traditional agency fee structures based on labor hours or full-time equivalents. This shift reflects concerns that such models do not accurately represent the value agencies deliver in today's advertising landscape.
Why it matters
Understanding how agencies are compensated is important because it affects the quality and type of work brands receive, and signals broader changes in the ad industry’s business models.
Explain it like I’m new here
It's like paying a babysitter by the hour, but now parents want to pay based on how well the kids are cared for instead.
Read the original at VideoWeek
Terms in this story
Advertiser
An advertiser is the company, organisation or person that pays to place ads in order to sell products, build a brand, recruit, or spread a message.
Agency
An agency is a company that plans, buys, creates or manages advertising on behalf of advertisers, in exchange for fees, commissions or a margin on the media it buys.
WFA (World Federation of Advertisers)
The WFA (World Federation of Advertisers) is the global association of advertisers and national advertiser associations, based in Brussels, that represents brand owners on marketing, media and policy issues.
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