AICE, the marketing communications post production industry association, has issued an important policy statement that addresses head-on a list of current business practices that, when taken together, threatens the health and vitality of its members’ businesses.
The move is an effort to confront a number of trends emanating from advertisers and agencies that AICE members view as generally devaluing the contribution of post production to the success of marketing communications campaigns.
The document, titled “It’s Time to Re-think Current Ad Industry Post Production Business Practices,” summarizes the prevailing marketplace conditions that most post production companies that primarily handle advertising assignments for agencies and brands are laboring under.
To review the full document, see the attached file or CLICK HERE.
In addition to the release of this policy statement – which has been distributed to all member and associate member companies of the association and will be shared with industry groups on both the ad agency and marketer sides of the business – AICE has also formed a standing Business Affairs Committee.
This new committee includes representatives from every major AICE Chapter in North America and is headed by a veteran post production executive with broad experience. It has been tasked with creating a forum where issues and concerns can be shared with their business affairs and production management counterparts on the agency and client sides.
Members of the Business Affairs Committee include Gail Butler, Executive Producer, Hybrid Edit, Los Angeles; Craig Duncan, Executive Producer, Cutters, Chicago; Ray Forzley, COO/CFO, Section 8, Inc., Toronto; and Kristin Redman, Executive Producer, Hudson Editorial, Detroit. It’s chaired by Dee Tagert, Managing Director and Partner, jumP, New York.
As the statement notes, “the post production industry has been under serious financial pressure to deliver the same quality work and level of service agencies and clients have been accustomed to, with significantly reduced budgets and shortened schedules.”
It cites six areas of particular concern, ranging from competition from in-house agency facilities to the establishment of preferred vendor lists to the pressures brought on by sequential liability clauses that drag out payment terms.
It’s against the backdrop of these factors that certain larger marketers such as Procter & Gamble, Mondelez, AB InBev, Johnson & Johnson and others have begun to propose extending payment terms beyond 30 to 60 days norms to as much as 120 days or more. The statement addresses this issue as well.
“The imposition of extended payment terms could cripple many post production companies, drive them out of business and deprive advertisers and their agencies of such valued and important resources,” the statement asserts. It lists several key actions that AICE members might consider taking to counter such practices, including withholding delivery of key elements pending final payment, demanding greater percentages of bids before commencing work, declining to bid on jobs from marketers who are deemed to be slow payers and others.
The statement urges greater education on all parts to better define the pivotal role post production companies play in the advertising creation process and to illuminate how current business practices are undercutting the industry’s ability to continue to deliver what’s demanded by clients.
In addition, the statement calls for “advertisers, agencies, production companies and the post production industry to work together to develop a mutually-beneficial solution to this increasingly untenable economic situation.”
Both the adoption of the policy statement and the establishment of the Business Affairs Committee portend a more activist role for AICE in the ongoing dialogue over issues like fees, comp
