FELIX VICENTE small.2006.JPGMcCann Erickson, the leading agency in Spain by controlled investment according to Infoadex, has voluntarily left the Advertising Agencies Association (AEAP), the industry's trade body, which opened a case against it last week for a direct marketing activity in which it claimed to be the only group capable of guaranteeing its clients transparency in its operations. Pictured here is Félix Vicente, president of McCann Erickson.
This is, for now, the most notable consequence of the implementation by media groups listed on the US stock exchange of the Sarvannes-Oxley Act, which requires that the information provided by companies be transparent. As a result of these obligations, the Interpublic Group, to which McCann belongs, had to disclose an internal audit, which, in turn, led it to shop return to its clients revenues obtained through negotiations with third-party suppliers.
Although advertisers in Spain and other European countries generally take such revenues for granted, especially in the case of media agencies, these groups cannot ignore US law, and have been forced to operate on other bases, primarily through management fees or through a contract in which the advertiser cedes these benefits. Few advertisers admit in writing what was actually happening.
The conflict between McCann and the AEAP began to develop in late March, when McCann and its media agency, Universal Media, announced that they would work with their clients under a regime of complete transparency, including an audit of their accounts (which is not required by US law). The assertion that the two companies were the only ones that could guarantee complete transparency in Spain had already drawn considerable criticism from other agencies. The direct marketing campaign aimed at advertisers, in which this assertion was repeated, has led to this split.
