How to create an ABC in your country?

An ABC stands for trust. The trust of an ABC is driven by the following values and principles:

• Transparency
• Industry ownership
• The industry standard
• Self-regulation
• Non-for-profit organization
• Equidistance from the market players
• Professionalism

The fundamental product of an ABC is its credible data. It acts as the foundation for building and maintaining trust. All of an ABC’s structures, decisions, operations, services, and communications must be derived from this foundation.

It is essential to understand that trust must be at the core of an ABC from the very beginning of its construction. There is no way one can build a trustworthy organization “later on.”

This trust acts as the catalyst for all other aspects of an ABC. Trust builds synergy.

An ABC must be an open process. It must be built on a volunteering membership, where each member submits to the bylaws of the ABC for the greater goal of providing credible circulation information to foster more advertising sales and a stronger footing in financial viability.

This submission must be taken into consideration when writing and discussing the bylaws of an ABC.

Another feature of transparency is its open communications, both within the membership and to its public – information seekers to advertisers to media agencies. Many ABCs make public their membership list, the audited titles list, the audited figures, and all rules and regulations.

The internal work of the ABC must be verifiable by the members. As long as trust is an ABC’s foundation, it is counterproductive to be secretive, or to create the impression of hiding information.

Another feature of an ABC is its industry membership. Regardless of the legal frame of your country, it should be possible to create an organization where members (owners) are representative of the industry. This basis of membership creates the sense of ownership for the success of the ABC.

The most diverse structure of an ABC can be seen in countries where its members are advertisers, advertising agencies, as well as media owners. In some cases, there is an imbalance when an ABC is owned and operated only by advertisers or only by media owners. The key principle to consider is whether an ABC’s membership and ownership is representative of the media industry.

A representative ABC makes it possible for all sectors of the advertising industry to have a say in the creation and operating of an ABC. This quality will empower the audit service to become the standard for its market. It will early on and for the long term enhance the market’s acceptance and trust in the ABC and its services. This is another way of building trust.

An ABC with a diverse, representative membership will become the common denominator in working among its three key publics of media, advertisers, and advertising agenices.

An ABC must aim to become (and actually it is) the organization that sets the standards for a given market. The ABC works to standardize data and thereby become the authoritative voice in its market.

Before and ABCs is established, each individual market player is using its own definitions and terminology. As an example, how are printed copies versus sold copies defined, and are these two principles differently interpreted by each individual market player? A lack of standardization can create many misunderstandings and problems.

In the countries where I have worked with ABCs the ABCs themselves introduced for the first time a clear and understandable set of standards related to circulations. Today, in these countries, the key players are using the ABC terminology when talking about press distribution.

The ABC has, in a sense, created a language not only for the trade of advertising, but also for business communications more generally.

Last, but not least, an ABC should seek to educate the market about its activities, rules and regulations, and on how to read and understand its audited figures, and use its standards.

Maintaining a standard makes it necessary to educate an ABC’s key publics about its standards, and to teach it how to communicate in the audited world of media.

On of the most important principles guiding an ABC is self-regulation. There are many definitions of this terms.

Here are a few:

• The system by which an organization or institution deals with its own disciplinary and legal problems, often in private, rather than being publicly regulated by somebody else.
• To function automatically or without outside control.
• The controlling of a process or activity by the people or organizations that are involved in it, rather than by an outside organization.

An industry standard may be imposed (through government legislation/law), or – by contrary – may be developed by the industry players.

A standard which is imposed may be not be so readily accepted, and if it comes with a threat of penalties or sanctions that are enforced, this outside authority diminishes the initiative that self-regulation can bring, while lessening the credibility of the ABC itself.

The obvious – and best – alternative is to create a self-regulatory environment.

From an ABC perspective, self-regulation implies:

• Working together and maximizing the involvement of the industry. The more the number of players involved with standardization, the higher the acceptance of standards within and outside the ABC.
• Be representative. The larger the coverage of all industry sectors (in our case: advertisers, media agencies, media companies), the better. Diverse membership yields more credibility.
• Seeking common goals. One can work with others only if there are commonly accepted goals.
• Setting objectives with the lowest common denominator, or broadest impact and acceptance in mind. The objectives to be achieved must take into consideration a minimal platform, where acceptance by members is as close to unanimity as possible.
• Imposing the rules. A rule is as good as it is applied. In other words, the work of self-regulation must consider the set of necessary controls and actions to be taken against those who are breaching them.

The well understood and applied self-regulation within an ABC is instrumental in building trust among members and market players. It makes the future work much more easier and straightforward.

Forming an ABC as a non-for-profit organization communicates that the audit is not a means of making money and profits, but is truly a service to the media industry, and the free market more generally. This non-profit foundation inherently places trust as a guiding operation principle for an ABC. Of course, this doesn’t mean that an ABC should not plan budgets and operate to brek even in its works. It has to have enough revenues via membership and audit fees and other services such as research to fund itself. The non-profit basis means that the focus is on delivering the best service to its customers.

If the execution of a particular year’s audit bureau plan and operations generates net revenues, these excess funds should be reinvested in the next year’s budget. The net revenues can also be used to induce more membership by reducing memberhsip fees.

One benefit of the not-for-profit operations is that the price of providing the service is the lowest possible, since it doesn’t have to generate net profits for its members.