Advertising Week

ANA Chairman: 'Our Perspectives Not Aligned' With 4A's on Transparency

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Tony Pace sitting for an interview with Ad Age in 2015.
Tony Pace sitting for an interview with Ad Age in 2015. Credit: Nathan Skid or Advertising Age
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If it wasn't already clear enough, a panel today at Advertising Week pretty much assured that the ANA and 4A's are going their own way when it comes to solving the rebate issue.

Issues around media transparency will likely be solved "on a more individual marketer-to-agency basis versus having a global solution because of different perspectives in the membership of 4A's," said Tony Pace, chairman of the Association of National Advertisers, during a panel at Advertising Week.

The 4A's was originally slated to speak during the Trust Forum panel on transparency, but the association pulled out of the discussion a few weeks ago to put more energy into educating its members.

"I'm not inclined to be interested in drama," said Mr. Pace. "I would say our perspectives are not aligned right now, but we don't have any ill intent."

ANA CEO Bob Liodice said that even though the 4A's has different principles and guidelines, the ANA is happy that the ad agency trade association is pushing transparency. He said someday the groups might have "better convergence" on the topic.

Mr. Pace said he's optimistic that transparency issues will be solved and agencies and clients will work together. "The stewardship of media in my mind" is a shared responsibility, said Mr. Pace, adding that companies should have chief media officers in place.

"There's a perception that back in the day you hired an agency to do all this work for you, and a lot of companies have junior media people, but you need senior media people to dig through this puzzle and peel the onion," Ben Jankowski, senior VP-global media at MasterCard.

Last week, Dentsu Inc. informed longtime client Toyota of "irregularities" related to some digital media business transactions, a move the ANA applauded. The Wall Street Journal also reported last week that two prominent ANA members, JPMorgan Chase and General Electric, were conducting audits of their media agencies following findings of the rebate inquiry by Ebiquity and K2.

"This isn't just about the agencies; it's about the marketers as well," said Mr. Liodice. The 700 ANA members, which control about $200 billion in advertising spend, have to pay attention to the issue and listen to the Ebiquity report recommendations, such as looking over agency contracts and understanding the flow and costs of funds and decisions being made by agency partners, he said.

On the flip side, Mr. Liodice said during his 21 years at the ANA, "agency compensation has always been a topic of intense discussion ad scrutiny," and agencies have brought up unfair behavior from advertises, such as squeezing margins. "We can't let agency compensation or lack thereof be a reason for non-transparent, non-disclosed behavior," said Mr. Liodice. He said both sides have to be transparent and understand each other's pressures.

For small and mid-size companies, Mr. Pace advises them to read the K2 and Ebiquity reports, which is an "hour-plus investment, but time well-spent."

Beyond that, he says advertisers must have open dialogues with their agency partners to understand their business relationship. "It sounds simple, but that's really what has to happen," said Mr. Pace.