The ad agency network transparency scandals are doing us all a favour
While Dentsu is doing its level best to isolate the over-billing scandal to its Japanese office, the discovery is entirely unsurprising. If you haven’t been following, the results of the probe into the world’s fifth largest advertising agency found 997 trading errors affecting 96 clients. Dentsu’s answer: add an “independent” layer of oversight (agency employees) to monitor digital reporting and transactions and reform programmatic operations. This is like a sixth former marking their own A Levels.
Dentsu has been a key name in recent over-charging scandals
With ever shrinking margins, agencies are under increasing pressure, encouraging them to beat the system. Being forced to put your own interests ahead of those of their clients is the first red flag.
Dentsu isn’t alone. Interpublic, Omnicom, WPP and Publicis have all had questions asked too. This case is the symptom of a wider industry issue. There is a deep-rooted lack of transparency in the marketer-agency-publisher relationship. Proctor and Gamble’s recent decision to review all agency contracts brings this issue into even sharper focus, this is the start of the dam breaking.
Brand-side marketers with little time on their hands, trust the experts; often following guidance without asking the important questions. Agencies meanwhile, are seeking out opportunity. Even if it comes dressed in a straitjacket. At the end of last year WPP was issued a subpoena over potentially rigging pitches for production work to favour their in-house solutions. What should be a healthy transparent relationship between marketers and their agencies has become opaque.
This grey area often lurks within adtech. Knowing how and why your cash is being spent today requires both the deep technical knowledge and the time to investigate it thoroughly. A quick look at the current LUMAscape shows you that this complicated and crowded space needs an expert to navigate it successfully. It’s no wonder that most marketers are inclined to follow their trusted agency or consultancy’s advice, rather than risk being ‘left behind’.
So, what questions do marketers need to ask of their agencies to ensure they’re being served with the best technology solution for their business?
We know we should be asking about our data. Questions like: are we collecting the right data? What should we do with it? How can I obtain a complete overview of spend? And, most importantly, where and when is data being pulled?
Most media agencies are short on tech expertise. Clients are furnished with solutions based on deals they have in place with their preferred vendors. That’s fine if you’re receiving the discount as the client, but these back-hander agreements are often completely hidden from the client. And it promotes the recommendation of one-size-fits-all, sub-optimal technologies.
This approach can often leave marketers with tech that simply isn’t fit for purpose. And certainly doesn’t maximising spend.
Agencies aren’t the enemy but there must be a concerted move towards more transparency within the marketplace. And while the agencies are under so much pressure, brand marketers must seek out impartial expertise to navigate the martech stack. The cases of Dentsu and WPP are not isolated with other major networks such as Interpublic, Omnicom and Publicis also contacted and we must be grateful that they highlight the systemic issue. The relationship is broken and it won’t be long before marketers start to seriously question why these technology stacks aren’t delivering the results they should. Proctor and Gamble will not be the only firm to extensively review their digital advertising spend; the demand for transparency will only grow louder and louder as more and more firms question their current inefficient solutions.
This space doesn’t always have to operate like this. The first step is for a client to question everything in their technology stack, then they can take back ownership of the problem. A marketer armed with the correct knowledge and insights will always arrive at the right outcome for their business.
Neil Eatson is CEO and founder of Appraise Digital. He can be found tweeting @NeilEatson