ANA and 4A’s Duke It Out Over Kickbacks and Media Transparency

On June 7, the ANA released a study conducted in conjunction with K2 Intelligence that showed evidence of "pervasive" kickbacks, estimating that some agencies marked up media buys by 30 to 90 percent. Both the 4A's and the ANA have released their own set of media transparency guidelines to tackle the issue. On July 28, the 4A's, which released its guidelines in January, rejected recommendations released by the ANA on July 18 with the support of marketing analytics company Ebiquity and FirmDecisions.

Nancy Hill, president and CEO of the 4A's, told Adweek, "We maintain our position that transparency is a best practice and continue to advocate for this to our members. It is inappropriate for a trade association to comment on contractual language, which is between the two contracting parties, not between two trade associations. We have always wanted to have open dialogue, and still welcome finding common ground. But when it comes to legal and contract specifics, we feel these are best left between agency and client." 

Meanwhile, the ANA feels that the 4A's' guidelines "do not fully or adequately reflect the best interests of marketers," ANA CEO Bob Liodice said in a statement. And by rejecting the ANA's recommendations, the 4A's "essentially called for a preservation of the status quo," Liodice said.

The ANA's guidelines included recommendations that advertisers could implement to achieve full transparency from their agencies, including: establishing overarching media agency management principles that can be easily understood and executed; establishing primacy over the client/agency relationship and regularly re-evaluating and upgrading internal processes and practices; and creating a uniform code of conduct between the advertisers and agencies.

The 4A's guidelines included principles addressing transparency in working relationships among marketers, agencies and media covering areas of client and agency relationships for U.S. media planning and buying; separate commercial relationships among agencies, media vendors and other suppliers; and client and agency governance.

The 4A's is hosting a town hall meeting for members on Aug. 17 to discuss its transparency principles. In his statement, Liodice invited the 4A's board of directors to meet with the ANA board at the ANA's national conference in Orlando in October to discuss the issue.