It appears the agency-consultancy stand-off is set to get even uglier with news today that WPP will soon refuse to be involved in pitches that involve its bitter arch-rival, the consultancy firm Accenture.
For a long time now, traditional agencies have feared being audited by the consultancy firms’ accounting arms.
Adland argues that it gives the consultancies too much insight and intelligence into their business model and, in turn, allows the consultancies’ media arms to undercut agencies during the pitch process.
So concerned is WPP by Accenture’s influence, the world’s biggest media company has reportedly announced it will stop participating in any media pitches supervised by Accenture starting in 2020, Didgiday UK is reporting.
Digiday cited an email from an from an unnamed ad executive who works closely with WPP’s GroupM buying arm. The email reportedly states that WPP is threatening to withhold cost and qualitative data from unspecified global pitches that have been overseen by Accenture auditors.
The email reportedly read: “It’s due to Accenture Interactive acting as both an auditor and a media agency of sorts with its pitch to help advertisers take their ad tech in-house.”
Neither WPP or Accenture have verified the claims made in the article. Nor is it clear if other holding companies plan on following WPP’s lead.
However, for WPP’s plans to work, it has to get the clients on side to agree to remove Accenture from the process.
Many media clients use auditors to ensure that their spends match what has been promised by the media agency.
The practice is particularly common in Australia where a media agency acts on behalf of a global client who may not have the appropriate local staff to perform the due diligence themselves.
Any audit can allow access to information such as cost per gross rating points on TV, display CPMs, viewability rates and how the reach of any ad equates to how many times it has been seen.
Agencies argue it gives consultancies unprecedented access to the inner workings of the agency and then allows the consultancy’s media arm to undercut the traditional model at the next pitch.
This is particularly alarming due to consultancies’ strength in things like tech and programmatic.
Didgiday then goes on to quote another unnamed media executive who said of WPP’s mooted boycott of Accenture: “This decision comes from the people at the top of WPP, but it’s hard to see how it plays out at global and local levels.
“A stance like this suggests WPP will say no to being audited as there aren’t many auditors outside of Accenture currently that global advertisers are going to want to use. WPP needs to have a compelling argument to justify the boycott to advertisers as I doubt many will share the same conflicts of interests concerns as agencies.”