Is Accenture’s Programmatic Pivot a Primal Threat to Media Agencies?

One consultancy might just disrupt the market

Some agency leaders and industry groups argue that a line has been crossed. Getty Images, Accenture

The consultancies are no longer coming … they’re here.

What had been a semi-serious joke in the agency world became a bit more real last month when Accenture Interactive, the international consultancy’s marketing division, announced plans to begin offering programmatic media buying services.

The news was significant, but not unexpected.

“It’s a perfectly logical step for Accenture Interactive to launch a programmatic service, because they already advise many businesses on technology, infrastructure, process and skills, which are essentially the key ingredients of an in-house programmatic operation,” said Tom Denford, co-founder and chief strategy officer of global management consultancy ID Comms.

Sarah Warner, digital investment lead for programmatic and video at WPP’s GroupM, added, “I wasn’t particularly surprised by this.” She credited the “democratization of the technology and the skill-set” with an “increasingly lower cost of entry.”

According to industry leaders, the issue is not whether the company can enter this potentially lucrative market, but whether it can truly stand out.

“Accenture has tremendous market knowledge of their business,” Warner said, but “not necessarily as it relates to media buying and activation.”

Fellow player or direct competitor?

Still, quite a few executives on the agency side saw the news as a sign of Accenture infringing on their turf—a shot fired, as it were.

Their key argument centers on the idea that Accenture, which performs auditing services for hundreds of clients, has created a potential conflict of interest by giving itself the power to recommend this new programmatic offering to the same companies.

“The audit arm in theory could be in the position of having to ‘independently’ assess the performance of its own programmatic advice,” said Denford.

"We would never be in a position to audit our own work."
Scott Tieman, global programmatic services lead, Accenture Interactive

As one agency leader who spoke to Adweek on condition of anonymity put it, “Their position has been ‘agencies are not neutral, clients need a neutral third party to evaluate how their agencies operate.’ They are now an agency and will be under the same supply chain scrutiny of all agencies.”

The 4A’s and MediaCom chairman and CEO Stephen Allan were even more blunt in their critiques.

In a LinkedIn post, Allan warned clients to be “very wary” of the “troubling” development, writing, “You can’t ask for money to pay the piper and then play the tune yourself.” The 4A’s described the “unacceptable” new offering as “a clear conflict of interest, positioning Accenture to engage in media trading and then also be responsible for auditing the trading results and processes of its competitors.” It then called for revisions to media auditing guidelines and asked agencies to reconsider participating in any reviews overseen by Accenture.

For its part, Accenture sees no such friction.

We’re all in this together

Accenture Interactive global lead of programmatic services Scott Tieman told Adweek that concerns about a conflict of interest within the “very large” and multilayered organization are misplaced. “The part of the organization we are in—the Interactive and Marketing team—is completely segregated from auditing, which sits in our procurement division,” he said, adding, “these are not marketers.”

“We have strict policies in place to restrict how [client] data can be used,” he continued, stating that the divisions never share data and that “we would never be in a position to audit our own work” on the marketing side.

He also clarified that, when the organization does audit itself, it never does so in conjunction with unrelated services like ad buying.

“Accenture has tremendous market knowledge of their business, but not necessarily as it relates to media buying and activation.”
Sarah Warner, digital investment lead for programmatic and video, GroupM

Allan, like several other media agency leaders, anticipated such a response and wrote that, while he welcomes competition from Accenture, its new sales business is “frankly incompatible” with its more traditional role as an auditor. Others predicted that Accenture will eventually dial down or even eliminate those auditing services because, as Denford put it, they will “be far less lucrative in the long term than its new programmatic business.”

When asked why his company had decided to move into the programmatic space, Tieman said, “We’re just really focused on helping clients … not making a quick buck.”

Greg March, CEO of independent agency Noble People, believes that clients with large scale accounts who previously felt like they had no other option but to deal with media agencies that “made a lot of margins by being clever accountants and deal makers” may find Accenture’s offer enticing. He predicted that the consultancy may charge more for its services than large holding companies but that “[they] will play it straight up.”

Not all parties agree that Accenture poses an existential threat to major networks. Most, however, did say that a lack of trust created this opening for the consultancy.

“Mechanically, competition in programmatic increases yield for publishers, and we want to see more of that,” said Oscar Garza, evp of media activation at GroupM’s Essence. Citing agencies’ recent struggles with rebates and transparency, he added, “Competition is good for the industry … because a bad actor makes us all look bad.”

Trust, transparency and control

“Clients have concerns about adversarial relationships with some service providers,” said Tiernan, who told Adweek that the practice by which some agencies take a given portion of a client’s media spend as revenue “incentivizes the wrong behaviors.” (Problems stemming from this very approach led to 2016’s notorious ANA report on “kickbacks.”)

To that point, CEO Kamran Asghar of indie agency Crossmedia “applauds anyone who’s bringing clarity and transparency to media in general” and programmatic in particular. “We would look forward to partnering with Accenture” if they were handling such work for a given client, he said, concluding that the key lesson to draw from this trend is that clients have more fully recognized the importance of control and visibility in the media chain.

"If clients are asking Accenture for this, then what the hell is wrong with our industry?"
Kamran Asghar, CEO, Crossmedia

Asghar predicted that Accenture’s entry will ultimately hurt holding companies that draw a large portion of their profits from media fees. But the size of this impact remains an open question.

Warner told Adweek she expects “business as usual” at GroupM despite the presence of a big new player in the space. The anonymous executive even argued Accenture is “late to market” as major advertisers like American Express have been moving programmatic operations in-house for several years with agencies adapting in turn. He does not believe the new offering will have a discernible effect on his shop’s relationships with existing or potential clients.

Traditional shops also have an inherent advantage because they “have been doing it so long,” said the agency source, adding, “For right now, we feel we can better manage and protect our clients in that space, but we’ll see what happens with [Accenture.]”

And while Garza spoke optimistically of the company’s entry into programmatic, he added a caveat, cautioning advertisers to ask “all the right questions” because “there’s just a lot of things to worry about [in terms of] determining that value.”

Crossmedia’s Asghar expressed his concerns more succinctly. “There’s no shortage of people who can deliver programmatic as a service,” he said. “If clients are asking Accenture for this, then what the hell is wrong with our industry?”

@ErikDOster Erik Oster is an agencies reporter for Adweek.
@PatrickCoffee Patrick Coffee is a senior editor for Adweek.