The Death of the Insertion Order
By David Paynter
When I first started out in
online advertising back in 1998 at a company called
Bla-Bla.com, the insertion order was as good as money in the
bank. I remember getting off the phone with an advertiser
and waiting by the fax machine for an insertion order to
come through with a promise to pay $30,000 from some other
dot com. That was exciting, and as soon as I saw that fax come
through I knew my commission check for that month was going
to pay off student loans or finance a vacation. In that
golden boom period in online marketing, Bla-Bla.com would
even pay commission checks before the money was even
collected! Because the IO was an iron-clad agreement in
those days, it meant that what was included in the agreement
would be carried out (swiftly) along with supplying me with
a nice commission check.
Paying commission checks to
account managers on incoming insertion orders today is
unheard of and even laughable. It seems that now, the IO is
just a step in the process of getting a campaign live. It’s
just one of those things that you do because of the standard
protocol that has become ritualized in the industry. Does
it mean that you will actually generate the revenue that is
stipulated in the IO? Not always. Does it mean that even
if you do generate the revenue stipulated in the IO that you
would get paid? Not always. Does having an IO help you to
collect that cash when a campaign is done? Through the
years I have had several IO’s from “reputable” companies
that ended up just being a piece of fax paper when it came
down to it.
An IO is basically a contract,
and in order to enforce a contract you have to bring in
lawyers and courts, and most importantly, money to pay the
lawyers and the courts. In fact, many IO’s that come across
my desk today aren’t even enforceable through legal means
and contain so much meaningless verbiage that they are
rendered useless. In our industry, IO’s have certainly lost
their basic meaning, teeth and iron-clad nature.
In instances where collection
of money based on an agreed-upon IO, it has been my
experience that the fees involved in enforcing an IO would
cost more than the dollar amount I am trying to collect.
I can’t even count the amount
of times where someone said to me,
“Do you want to use my IO or
yours?”
Whenever I hear this, I think
to myself,
“Why bother?!”
If I am going to get paid from
an advertiser, it is not going to be because I have a signed
IO from them outlining the campaign complete with
descriptions and expectations of what will happen. Instead,
I find myself only working with companies that I have a long
standing relationship with, or I know has a history of good
payment. It seems that the industry is trending more
towards a model actually based on past-relationships where a
written contractual agreement like an IO is meaningless
compared to a phone or IM conversation. This can serve our
industry well if we all know each other and have good
reputations. However, trying to create new business
development relationships in such a climate is maddening.
On countless occasions, I have
been on the phone or on the IM with one of my affiliates, or
even advertisers, and they will say “I see you are working
with Company X. Watch out! They took us last month for
almost $100,0000.00!” Now you know that Company X signed an
IO with your contact, but is it the signature on the fax
that is going to get payment? More times than not it is the
countless phone calls to accounts payable, CFO’s, and
presidents that end up getting you on some kind of payment
plan, or getting $0.20 on the dollar.
So, why
do we still sign the almighty IO? Is it that we are hoping
maybe this time it will mean something? Or is it just
another measure to help you keep track of whom you are doing
what with. I am not saying that the IO does not serve a
purpose, because it most certainly does, and it should mean
more, but why does an IO mean less in online advertising
then it does in print or television?
