Editorial: Consultant fight masks big issue

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How much to pay ad agencies has become the emotional and explosive wedge issue dividing agencies and advertisers, and the role played by compensation consultants in that debate is bringing agencies' worries, and resentments, out in the open. That's good. But it's a mistake if agencies allow advertisers to think the problem is simply a nasty feud between agencies and some consultants. There are much bigger questions here that advertisers, in the end, will have to answer for themselves.

On Page 1 last week, we reported on the tensions between agencies and some consultants over what agencies say are unethical practices. This week American Association of Advertising Agencies President O. Burtch Drake, on our Forum page (see Page 83) lays out for advertisers why ad agency managers are so angry. Advertisers and consultants should read it closely.

Agency costs should not be immune from scrutiny (no more than media costs, production costs and so on). And, no doubt, many advertisers are getting, in larger or smaller measure, lower prices from their agencies as a result of their cost-cutting efforts. That's business, and what managers are expected to do. But obtaining agency services at the lowest possible price must not become the only measure of success for client marketing departments. Obtaining advertising that connects with consumers, creates markets and builds value into a brand should be the goal. Would Nike walk away from Wieden & Kennedy because it could buy agency services more cheaply elsewhere?

Of course, some advertisers may really believe advertising and marketing services, and the thinking and people behind them, are interchangeable commodities. That's what the Four A's needs to address head on. And advertisers? They need to realize that the unthinking pursuit of the lowest price for agency services will go a long way to make that commoditization of ad agencies a very ugly reality.

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