• Adweek, Sunday, July 18, 2010 11:36 PM

Should the winning media agency in a new business pitch be required to pay the client a $1 million-plus "signing-on" fee for the privilege of handling the account? Or should all agencies be required to pay a pitch fee to demonstrate a good-faith commitment to winning an account they're contending for? wonders Adweek.
Two recent overseas media pitches have had the industry buzzing over such questions for the last two weeks. Agency executives and search consultants were critical of the tactics imposed by the clients: travel company Thomas Cook for a U.K. review and Reckitt Benckiser for a pitch in India -- and said such provisions haven't been tried in the U.S. and wouldn't fly here if attempted.
 
According to a report in Campaign, which broke the story, Thomas Cook was demanding a so-called "signing-on fee" of nearly $1.5 million from the winner of its ongoing media agency review in the U.K. The company spends an estimated $45 million in the market. Separately, Campaign's India edition reported that Reckitt was demanding $10,000 pitch fees from all contenders.
 
"I've never heard of it being done here," said Russel Wohlwerth, principal at search consultant Ark Advisors, referring to both situations. "And I don't think it would go over very big here, either," he said, noting, "We have an issue when marketers want to own the creative concepts coming out of a pitch. "

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