Agencies voice concern over objectivity of consultancy audits

Dive Brief:

Advertising agencies are concerned that management consultancies will not be able to objectively carry out certain aspects of their business such as media audits as major players in the space like Accenture and Deloitte continue to push into offering more marketing services, according to a report in Ad Age.
The issue stems from the fact that consultancies might no longer be impartial in auditing agencies who are quickly starting to serve as competitors for marketing clients' business. "You can't have a fox in the henhouse," MediaLink Chairman and CEO Michael Kassan told Ad Age. "This is potentially the most egregious example of someone grading their own homework."
For their part, consultancies argue that firewalls including governance structures and tight policies are in place between their different business units. Accenture, for example, noted that its Media Management unit is separate from its Interactive digital agency. However, agencies point out that audits of their books provide those consultancies with private internal data and economic information regardless, which the marketing arm of a consultancy might use for competitive advantage.

Dive Insight:

In an industry that's been obsessing over the idea of transparency — it was the ANA's marketing word of the year in 2016 — the latest news adds an interesting wrinkle to the conversation. While, in the past, accusations of a lack of transparency have largely been lobbed at agencies, the Ad Age report raises what might be some legitimate concerns directed at a consultancy space that is slowly encroaching on traditional agency business.

Not just agencies, but also major marketing figures, including Procter & Gamble's Chief Brand Officer Marc Pritchard, are skeptical toward the practice of having one organization conduct both agency and auditor duties, per Ad Age.

Forrester Research recently found that 60% of marketers were willing to work with consultancies and that only about half were happy with their agency partners. Stemming from that, agencies are being audited and put under review by marketing clients more frequently than they have in the past.

The auditing space itself is additionally under more careful inspection from watchdog groups including the Media Rating Council, Ad Age said, which seek to establish more standardized "ground rules." It might ultimately end up being a situation where the auditors are getting audited, layering more complexity onto an already complicated process.