Monday, April 27, 2009

Here comes a user network comp model

Wow! What a revolutionary idea. Not. Share the risk. Get an upside if you perform. Minimum risk if you don't. Just common sense. On the other hand, maybe common sense is a revolutionary idea.
Coke Pushes Value-Based Agency Compensation Model
- @ Advertising Age
"Urges Industry to Let Shops Profit Only if They Hit Established Targets By Jeremy Mullman and Natalie Zmuda
Published: April 27, 2009

CHICAGO ( -- Coca-Cola Co. is trying to start an industrywide movement toward a 'value-based' compensation model like one it's adopted that promises agencies nothing more than recouped costs if they don't perform -- but profit margins as high as 30% if their work hits top targets.

Usually tight-lipped Coke disclosed its plans at the Association of National Advertisers Financial Management Conference in Phoenix on April 20, saying it wanted to nudge the industry into adopting value-based models as a standard practice."

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