Forget True Detective. A noir-ish saga is unfolding in the advertising world, complete with favoritism, kickbacks, and shady deals. Who wants the movie rights?
A new report from the Association of National Advertisers (ANA), which represents many of the largest advertisers, found that numerous ad agencies are not always operating in the best interest of the client. The report cuts across all media channels but focuses a great deal on the world of digital advertising and its opaque ethics.
For instance, companies and organizations hire ad agencies to design and execute the best possible advertising strategy. But agencies often direct client funds toward a particular media supplier from which the agency receives a rebate, without the client knowing. Agencies also direct client money to companies with which the agencies are affiliated, when more affordable services may be available.
For now this practice – and many other questionable practices noted in the report – is perfectly legal, though perhaps not for much longer. The ANA report is just the latest among other troubling reports concerning the prevalence of misleading and fraudulent practices. As a result, some advertisers are reportedly “tapping the brakes” on their digital advertising, and Congress is beginning to take notice. Two U.S. senators recently asked the Federal Trade Commission to investigate digital advertising fraud.
While ad mail consultants sometimes similarly direct client funds to, say, an affiliated printer, ad mail as a whole operates in a much more transparent environment. A regulator not only reviews service standards and on-time delivery, but also the pricing of postal products. Congress also keeps a close eye on mail service and pricing. In short, ad mail practices and results are more easily eyed and measured, meaning it’s not so hard to tell if you are getting what you paid for.
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