Sponsor (Nov 1947-Oct 1948)

''Isn'l a <*<'iilral <*l<*ariii*; house of some kind lor sj)ot hroadoast a<Iv«'rtisiiig billing l>otli <l<'sirahle and IVasihIe?" Cr n I Adyertiiing manager ■ ^ "^OSSfS I Fred W. Amend Co., Chicago, III. Tho I*i4*k<'«l l*aiiol 31 1*. IKo^u^cr^: On the basis of my experience here at the Katz Agency, I do not think that the idea of a "clearing house" for spot broadcast advertising billing is applicable to radio. For one thing, it would inevitably disclose the quality and quantity of the business done in specific markets by certain advertisers who for competitive business reasons do not want this information made public. Also, the setting up of such an organization to clear all billings between stations and agencies would be a terrifically complex job. The Katz Agency, as a radio station representative, does handle billing in such a manner — but we handle it only for our list. An>' spot broadcasting clearing house handling billing for all radio stations and agencies would require a tremendous number of trained and efficient employees. The overhead for such a staff would undoubtedly be charged to the advertiser — and the cost would be considerable. The Katz Agency makes no charge for such a service. In addition we provide the duplicate function of protecting our stations' interests by protecting them on short rates and by advising all Katz salesmen of the trends in spot broadcasting, while giving automatic rebates to advertising agencies and their clients on all earned frequency discounts. In other words, if billings for spot radio arc to be cleared through one channel, that channel can best be the station representative. There is, however, a definite need in radio for a companion organization to a clearing house. Such an organization would be a checking service to keep records on spot business, much as Media Records and P. I. B. do for printed media. It is obvious that there are many difficulties in setting up such a service, due principally to the reluctance of some spot users to release expenditure figures, but this sort of service would, in my opinion, be a more practical contribution to the business of broadcast advertising. Morris J. Beck Treasurer The Katz Agency, Inc. It seems to me that such a clearing house would only complicate matters more than the\ are at pres~|^ ent. Since station ~ representatives -^ thrive solely on spot radio, it's their function and responsibility as sales-service organizations to know and handle all phases of the business, including the many variables that enter into each piece of spot billing. As it stands now, station invoices and affidavits go directly to the agency. When a problem arises, the agency takes it up with the rep who, in turn, straightens it out promptly with the station. What will be gained by having anybody else in the act? Under the proposed plan, agencies would check their billing problems, I assume, with the clearing house. The latter, in order to iron out the problem, would necessarily have to check with the rep or the station, probably both. This would require that the station or the rep report all details of the deal, all omissions, make-goods, and other schedule changes affecting invoices and affidavits to the clearing house, as well as to the agencies. Assuming that stations and reps would be willing to cooperate with the project and release such confidential, detailed information on all their business deals (a ver>' unlikely assumption), the system itself would only tend to further complicate an already overly-complicated business. There would be overlapping of effort, additional confusion, additional paper work, a slowing down in procedure, a new bottleneck. If agencies, stations, and reps are looking for a way to simplify and reduce the work involved in spot billing procedure, they should urge the adoption of a standard, combination invoice-affidavit form by all broadcasters. Such a form, carefully tested, is available. N. Charles Rorabaugh President N. C. Rorabaugh Co., N. Y. In my opinion this clearing-house idea would make impossible a prompt and accurate relationship between advertising agency and station for the following reasons : 1. To notify an outside source of all the details of the spot campaign — what is bought, length of contract, cancellation terms, appropriate rate card or special rates worked out, would take agenc> time better devoted to the purchase and improvement of the spots themselves. 48 SPONSOR