Agencies Reportedly Settle Over Rebates; Omnicom, Publicis To Split Disney Media Account

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Rebate Redux

Media agencies are paying settlements to clients as a result of contract audits sparked by the ANA’s 2016 transparency report, AdAge reports. Nearly 100 audits have taken place, but it’s not clear which clients or agencies are involved or if any money has changed hands yet. Most clients are forgoing cash payouts to avoid public disclosures and accepting free media instead. But they’re doing so on the precondition that they can’t audit the media, meaning they don’t know the quality of the inventory or how much the agency paid for it. Often, agencies will leverage the collective buying power of their clients to get a cheaper rate. But CMOs have no incentive to change these dealings, because free media helps them meet their performance goals. “I get how that looks good,’” said Stephen Broderick, CEO of FirmDecisions, a marketer consultancy that does agency audits. “But the reality is you’re just buying more of the same nonsense you got involved [with] in the first place.” More.

House Of Mouse

Publicis and Omnicom have emerged as winners in the multibillion-dollar review of Disney’s media business. Publicis won the business for Disney’s parks, wresting the account from Dentsu’s Carat, and for the new streaming service Disney+, which will mean a deluge of ad spend. Omnicom has retained the majority of Disney’s ad spend, winning its TV networks, including ABC, FOX and Nat Geo, as well as entertainment studios Marvel and Pixar. People with knowledge of the deal say Disney was impressed by Publicis’ Epsilon business, the data company it acquired for $4 billion earlier this year, Campaign reports. Meanwhile Omnicom followed another trend by creating a bespoke agency for Disney, OMG23 (a reference to 1923, when Disney was founded). More.

Get Low, Get Low, Get Low

Walmart, long known for its tough approach with vendors, has taken an unusually brand-happy strategy to help it undercut Amazon’s low-price advantage. Walmart is inviting some sellers it carries into the new Competitive Price Adjustment program, where the retailer will discount products but the brand earns the same as at the higher, typical rate. “Customers will get a brief window of deep discounts, but some might be driven away when the prices return to their original level,” Bloomberg reports. “Manufacturers, meanwhile, might get complaints from shoppers who bought the item for more elsewhere. But Walmart is determined to get creative as the battle for online customers heats up this holiday season.” More.

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