Ameritech Corp. is laying down unusual ground rules for its $100 million media review, asking the ad agencies contacted to agree not to dump the account even if they take on creative work for another telecommunications marketer.
In a letter sent to the selected shops by consultant Morgan, Anderson & Co., New York, Ameritech also said it won't consider it a conflict even if "a sister office of the media AOR office . . . works in the media area for another telecommunications company," as long as there's no sharing of Ameritech information.
A SEA CHANGE
If participants in the review agree to the terms, it could mark a sea change in how U.S. shops deal with conflicts, particularly in crowded fields like telecommunications.
Ameritech's unusual stipulations--the first very restrictive, the second very lenient--reflect two factors affecting the review.
First, it indicates the difficult position Ameritech was put into by former agency Leo Burnett USA, Chicago, which abruptly dropped the media account on Oct. 17, after having lost the creative to Ammirati Puris Lintas, New York, in July. One of the reasons Burnett finally decided to resign the media was so it could pursue full-service telecommunications business.
Ameritech, in its letter from Morgan Anderson--a copy of which was obtained by Advertising Age--stipulates that the next agency it selects as media AOR must "agree in the future not to pitch or take on a new telecommunications creative [brand] account without first discussing this with Ameritech, and that . . . you will continue to handle Ameritech's media AOR account and not resign the Ameritech account for reasons of conflict."
DIFFICULTY A FACTOR
The second factor clearly affecting the review is finding a buying service or agency of any scope that does not already have a client in the hugely expanding category. That's behind Ameritech's statement that it will allow a sister office of its media AOR to represent another telco, as well as the fact Ameritech does not consider it a conflict "where the parent company of the media AOR does creative work for another telecommunications company."
"These are extraordinary statements for a client to make," said one top agency media executive.
"For someone in a category as competitive as telecommunications to allow a media conflict in a sister office of the same shop is unheard of in this country," he said.
He added that the problem Ameritech will likely face is that any telecommunications company already represented by an agency or buying service probably would not allow a dual representation of Ameritech, even in another office.
A manager at another agency said, "Ameritech is likely to run into resistance about its stipulation that an agency getting the media AOR can't go after a bigger creative/media telco account down the road. That's just too, too restrictive, and frankly, not a decision for the client to make."
Arthur Anderson, principal of Morgan Anderson, citing confidentiality, declined to talk about the Ameritech review. However, he did address the conflict issue in general.
"We're seeing a trend that's going to end up to be a hybrid, I think, between the American tradition of the package-goods companies--with their strict rules about conflicts--and the Japanese tradition--where a number of automobile companies, for example, use the same agency," he said. "The hybrid will likely end up closer to the American model."
Five agencies or media independents have responded to the questionnaire and agreed to its terms, said an executive close to the review. The names of those agencies or media independents were not disclosed. Two of those are likely to be Ameritech's creative shops, Ammirati and Cliff Freeman & Partners, New York. Both could be hooking up with media specialists.
NEED TO KNOW BASIS
Attached to the letter sent to participants is an eight-page questionnaire marked "Highly confidential" that asks respondents not to share it with anyone who doesn't have a need to know. The questionnaire further says that "spending for 1998 is projected to approach $100 million, of which the majority is spot TV."
Also, the winning shop must hit spot TV daypart and weekly goals within 5%.
The questionnaire goes on to ask for detailed information about posted second-quarter 1997 and projected second-quarter 1998 spot TV buys in Chicago; Cleveland; Columbus, Ohio; and Detroit.
Copyright November 1997, Crain Communications Inc.