IOAA mandates members, affiliate associations to root out ‘reverse auctions’

Indian Outdoor Advertising Association (IOAA) in a circular sent to members and affiliate associations has strongly urged the media owners / aggregators and specialist agencies not to be part of any reverse auctions and bids as the outcomes of such practices are extremely detrimental to the interests of the Indian OOH industry as a whole. In the circular, IOAA has stated that “in addition to the Standard Operating Process (S-O-P) that is being implemented from September 01, 2017, it is strongly felt by the entire member community that practise of conducting "Reverse Auctions" or inviting "Reverse Bids" by some advertisers need to be strongly discouraged and opposed as being totally unethical and highly damaging and detrimental to the business.”

Some advertisers are seen to invite specialist agencies and media aggregators to bid with the least costs at which each can deliver an identified set of sites or just a number of sites that the advertiser intends to use for a specific duration. In the process, agencies and aggregators that do not own any sites participate in the auction and quote aggressively low prices, without any reference to or participation and consent of the media company, “which is not only totally unethical and but amounts to misrepresentation and cheating”, states the circular.

IOAA maintains that this practice leads to various malpractices that are resorted to in order to meet the unrealistically low-cost commitments, both to the advertisers and internally. Also, those advertisers do not see the campaigns executed in the way they have been planned, and media companies too end up with unviable rates or lose the business altogether. The agencies / aggregators engaged in such practices are seen to focus on meeting cost targets rather than delivering the campaign with desired audience response.

“Advertisers who indulge in this - either of their own accord or as advised by their agencies - do not gain from OOH medium because of the basically unethical way of conducting their transaction and ultimately loses trust in the medium itself because campaigns do not deliver desired response,” the circular states.

In view of this issue, IOAA has urged the members and all Affiliated Associations to deny sites to any agency or aggregator or advertiser that requests for sites on basis of any "reverse auction" or "reverse bid" and not participate in any such transaction that is only aimed at lowering values of the media.

IOAA has informed the members (direct or through affiliated associations) that any entity found to be participating in any such "reverse transaction" shall have memberships cancelled permanently and any transactions they may have with other Members shall be actively discouraged.