Such a system can go too far, as Europeans now know. Can the same happen here if Interpublic's move sparks a new round of growth for U.S. media-buying specialist companies? We think not.
In France, the market was so rife with kickbacks and undeclared volume discounts that the government stepped in last year with the loi Sapin, designed to eliminate hidden commissions and other charges advertisers couldn't see. Now, at least, French advertisers know what the media they paid for actually cost.
Profits of ad agencies-almost all now members of large buying groups-plunged.
Possibly more disconcerting in a system like Europe's, the full-service account is fast becoming the exception. Advertisers, encouraged to see media as separate from the creative and strategic process, simply shop for the best deal.
Not that that's not happening in the U.S., too. But not on the same level as Europe. During the past year, Carat has gone country-by-country siphoning off hundreds of millions of dollars in Volkswagen media buying from the automaker's full-service shops.
The strength and importance of independent and/or separate media-buying operations in the U.S. is not comparable with Europe. Qualitative differences have meaning, and the U.S. system of buying media time and space is soundly based. With that foundation, there's nothing to fear from the growing trend toward large-scale buying or buying operations. By and large, the client is never in the dark.
As is evident now in France, opening the shade to the light of day can rescue even a runaway media-buying marketplace.