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Rebate Media Transparency

JP Morgan pauses ad spend amid agency rebate row

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By John McCarthy, Opinion editor

September 23, 2016 | 2 min read

JP Morgan has paused its $250m annual ad-buying account in the face of a supposedly widespread undisclosed rebates from media suppliers.

JP Morgan

JP Morgan

The decision was made in response to a K2 Intelligence report created for the Association of National Advertisers that found “substantial evidence of non-transparent business practices in the US market in the form of rebates”.

In an investigation spanning several months, it claimed to have found evidence of several instances where “media suppliers paid rebates to agencies, or entities affiliated with those agencies, in amounts ranging from 1.67 per cent to approximately 20 per cent of aggregate media spending” - these payments were often undisclosed to clients.

The Wall Street Journal cites people familiar with the matter stating that chief marketing officer Kristin Lemkau launched an audit into the bank’s media buying agency.

The K2 report refrained from naming agencies engaged in these practises.

The Drum analysed the five questions marketers must ask their media partners earlier today (23 September), which can be read here.

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