media trough M&M Global.“
ANA urges brands to reassess agency contracts07.06.2016
In the light of its damning report on the “pervasive” presence of rebates in US media, the Association of National Advertisers (ANA) has urged marketers to reassess and rewrite agency contracts.
The US trade body revealed it has commissioned Ebiquity and FirmDecisions to develop a set of guidelines and recommendations to help advertisers tighten up their agreements with agency groups, which is set to be released in the “coming weeks”.
One of the biggest complaints in the 58-page study is that agencies have been exploiting the wording of contracts to boost revenues through agreements with media and ad tech vendors.
The report stated: “In general, advertisers expressed a belief that their agencies were duty-bound to act in their best interest. Meanwhile, many agency executives interviewed said their relationship to advertisers was solely defined by the contract between the two parties.”
Until its full set of guidelines is unveiled, these are the full recommendations it is offering to advertisers:
1 – Re-visit those contracts
“Re-examine all existing media agency contracts and meticulously review all terms and conditions. As appropriate, use an expert, independent third party to provide insight and contractual expertise to optimise transparency, upgrade reporting and analytics, and substantially expand audit rights if necessary.”
2 – Sort out your training
“Implement media management training, particularly in the areas of contract development and management of the digital media supply chain.”
3 – Clarify the role of your agency
“Confirm and reaffirm the basis on which your media agency is conducting your media business. Be critically clear and comfortable with the agency’s role as agent and principal. Ensure there are no conflicts of interest, and that there are clear processes in place for resolving conflicts that might emerge.”
4 – Look at the holding group, not just your agency
“Assess whether contract terms permit you to ‘follow the money’ by having full accountability for every dollar that is invested with a media agency. It is recommended that audit rights cover not only the media agency but the holding company and any affiliated companies that touch your business.”