At least four in 10 marketers lengthened payment terms for at least some marketing services in the past year, according to a report today by the Association of National Advertisers.
In all, 43% of the 98 marketer respondents in the survey extended at least some payment terms for marketing services and media suppliers in the past year, though 17% had actually shortened terms in some cases. Across-the-board shifts are still relatively rare, as 90% said they made no changes in payments for at least some of their services during the year ended April 30, 2013.How Marketers Are Changing Payment Practices
|Type of Service||Lengthened Payment Terms||Kept Terms Same||Shortened Terms|
|Network Broadcast Media||23%||74%||3%|
|Local Broadcast Media||22%||74%||4%|
|Source: 2013 ANA Payment Terms Survey Report. For year ended April 30, 2013.|
Though the ANA represents marketers, the group warned of risks in extending payment terms. Its survey responses noted strained relationships with suppliers, higher prices and reduced supplier choice among reasons some marketers have actually backtracked and shortened payment terms in the past year.
Extending terms puts the livelihoods of smaller agencies, production and editorial companies and media outlets in jeopardy, the ANA said. The report cited a policy statement from the Association of Independent Creative Editors that said extended payment terms "could cripple many post-production companies" and "put them out of business."
"Client-side marketers need to consider what is fair and how they would want to be treated," the ANA report said. "If the payment terms they are suggesting to their suppliers would not be acceptable to them as suppliers, a re-think might be in order."