On this week’s #MediaSnack Tom and David kick off with some more troubling transparency news from the US, where the
Wall St Journal reports that the Department of Justice has launched a criminal investigation into major US creative agencies, which it accuses of “bid-rigging” on creative production.
The DoJ launched their investigation following receipt of information from K2 Intelligence, which the intelligence firm discovered during its work on behalf of the trade body Association of National Advertisers (ANA) into Media Transparency.
Evidence on the potential rigging of production costs (bid rigging is in violation of US anti-trust laws and wholly illegal) was not included in the ANA’s final report but the DoJ are following up
They have, according to the WSJ, issued K2 with a subpoena to collect relevant information – information collected as part of the K2’s media transparency investigations. A previous DOJ investigation into a similar matter ended up with agency people in jail, so stand by.
There may also be some nervous media agency execs in US hoping the DoJ doesn’t get visibility of K2’s media rebate evidence and launch a subsequent investigation aimed at them. It’s a realistic possibility. Holding group IPG has admitted they have been contacted by DoJ, we wait to see how far this will reach.
What Tom and David find amazing is that marketers have evidently been asking their creative agency to manage a process for them in which the creative agency themselves will bid. They argue that the whole situation illustrates the pitfalls of blind trust. Don’t ask agencies – of any type – to mark their own homework.
Next they discuss findings from a report by research boffins Nielsen which has analysed 44,000 digital marketing campaigns across Europe and found that nearly 50% of all served impressions did not reach the intended target audience.
This is alarming news for marketers who have been confronted this year with numerous questions over the way digital marketing is measured. It follows reports earlier this year that there are estimates of huge volumes of fraudulent clicks to digital display ads as well as continuing revelations by Facebook of errors in the methodologies of their own performance measurements.
Looking ahead to next year, Tom and David consider how marketers will want their digital marketing partners to help them solve these issues and inaccuracies.
Finally, in the continuing saga of the big consulting firms eating the agencies’ breakfast, lunch and dinner is news that Accenture Interactive (the marketing services division) has paid $50m to acquire leading UK independent creative shop Karmarama, the most high-profile agency purchase so far.
It sets a new marker for the spread of consulting scope into traditional areas of agency work. Accenture has a stated ambition to offer an “end-to-end” marketing service, which raises questions about whether they might move into traditional areas of media buying.
It seems unlikely that the industry would tolerate Accenture buying media whilst the company’s global media auditing business also examines the prices paid by other media agencies.
This is something that it will have to resolve.
