In a July 3, 2019, commentary on Media Post, staff writer Richard Whitman raised the question of whether consultancies – Accenture in particular – were more conflicted than holding companies.
While some agencies have on occasion refused to participate in agency searches that included agencies held by the client’s auditors, WPP has reportedly declined to participate in Accenture-managed agency searches.
Accenture, as well as a few other consultancies, still provide brands with consulting services which range from in-depth audits of client’s agency contracts, pricing, scopes and processes to managing agency searches (which also gives them detailed access to confidential proposals from participating agencies) and realigning agency rosters. And now of course they all hold a number of advertising agencies and related service providers.
As agency search consultants, we have argued over the years that there is indeed a far bigger conflict of interest than agencies within a holding company offering work to competing brands.
In the case of the latter, most agencies within holding companies don’t talk to each other – nor do agencies within a network of offices unless they share an account. This is not as true, however, of media agencies despite the claims of “fire walls,” but that’s a topic for another time.
However, the conflict for consultancies, in our opinion, could rise to unfair competitive advantages over the holding companies and their agencies – whether leading a client audit or managing an agency search, they do indeed receive detailed information that agencies have provided to clients in the form of proposals, contracts, scopes, staffing plans, pricing, and reconciliations.
Despite receiving assurances that there are strict safeguards between the consulting practice and the agency practice, we’ve had a few former new business leaders from consultancies who are now at holding company digital agencies tell us that the consulting team from their former employer did indeed share such confidential information with its agency new business developers.
While this is all hearsay, it’s definitely something the 4A’s and their member agencies should investigate and develop explicit clauses in their client contracts to prevent any unfair competitive advantages by consultancies.
For the ANA, with all its efforts around media and production issues, they should also be developing standards of client ethics around agency audits and procurement to ensure unfair competitive advantages for consultancies are avoided.
And, maybe, the DOJ needs get involved in this issue as well.
Bajkowski + Partners LLC is a leading consultancy providing services to marketing and procurement teams in the areas of agency relationship management, agency search, process audits, contract and SOW development and audits, and other marketing operations related areas. For more information, please visit our website.
