Pay-for-Performance Starts to Gain Steam

©IDG Communications, Inc. Photo contributed by Matthew Mikaelian.

Ad Age 

Sophisticated Measurement Tools Help Model Become Reality at Media Shops Such as Interpublic’s UM.
Last year, Interpublic Group of Cos.’ media agency, UM, hired consulting giant McKinsey to analyze how other industries are compensated. The objective was to change the antiquated agency-fee model to a riskier but more profitable pay-for-performance one. What resulted was a revamped system that more closely aligns the firm’s goals with those of clients. It is tied to key indicators such as sales or market share.

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