Transformation Insights: The Co-seller model

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During the recent update of the transformation office, we briefly talked about the co-seller model. We spoke to Frank Litewka, Senior Director Strategy & M&A, about the idea behind it, the roadmap, and the impact for everyone involved.  

Q1: Franck, we all are familiar with the agent model, earning commission. Why was there a need for change? And for which business is this offer?  

Franck: First, the agent model will not disappear in 2024 – especially not for TV & print – but will also continue to be available for a part of our digital business.  

For tax & legal reasons, we have to transform the way we work with RTL companies, that is why we start our first switch off with the AdAlliance Germany by January 2024. 

At RTL AdAlliance, digital campaigns for AdAlliance DE are already set-up via our ad server (smartx). Thanks to this, we can issue our own deal ID (programmatic deals). The co-selling switch is only a natural improvement to fit better to the digital business by being also fully allowed to invoice & collect money on the behalf of our main media partners, what our agent status does not allow us to do now. 

Long time before the merger, smartclip implemented the co-seller model with its 3rd party publishers and it has worked well ever since.

Q2: How will co-selling help us on a day-to-day basis? 

Franck: Our main motivation to switch to co-selling is to have a better governance of our direct digital business. This co-selling activity will bring us more flexibility to bundle our inventories (e.g. 6play + RTL AdAlliance’s 3rd party inventory in France) and create one single deal or IO (Insertion Order) for the buyer.  

It will allow us to improve our negotiation power with clients thanks to a better control of the price.  

Cherry on the top: it will also allow us to create our digital deals faster with a better tracking of our campaigns (e.g. live performances). Today, with the existing agent model, this is not possible. You are stuck with the price, campaign performances or inventory packages the partner/publisher provides.

Q3: What impact does it have on different stakeholders?     

Franck: For sales, this shift will not directly affect their daily business. They will brief the AdOps as they are used to.  

Effects will be seen more during the negotiation process: if the client wants a single invoice, instead of having multiple invoices coming from each media partner (publisher) in the agent model. If the client wants a better discount, we will also be more agile & responsive to that kind of demand as we will not have to check each time with our partners, like today.  

Of course, advantages come alongside with responsibility, sales will also have to pay more attention to the negotiation, as each % will come from our own margin.  

It is a new mindset.  

For the time being, both models will co-exist as the switch to co-seller requires change of contracts and the integration of inventory on our smartx ad server.

Q4: Why is the co-selling model an improvement also regarding future activities?

Franck: As an example, all co-selling direct campaigns sold on an IO (Insertion Order) will be invoiced centrally by our Finance team. 

Sales will be able to sell multi-market campaigns and send only one IO & one invoice (only possible for RTL AdAlliance’s 3rd party inventory now, by January 2024 also for AdAlliance Germany) 

For the future, new technical & financial integration with smartclip technology will enable additional improvements – like agency deals, new products, new targeting options… 

Regarding the product set-up, our product team is already working on new advanced digital products, either with better targeting options or better packages of inventory.

Q5: And which partner are you integrating next? 

Franck: Our roadmap is quite clear, we start with RTL companies first, and among them, AdAlliance DE is priority number 1.   

We hope to be fully up & running by beginning of January 2024. Next step will be then M6 and RTL Netherlands in 2024. We also start to investigate with our other non-group partners, but no roadmap has been defined so far yet.