GroupM told its staff Monday that it did not want any loose lips on the subject of remuneration agreements with clients and media buying practices generally.
The internal memo was issued by Kelly Clark, outgoing GroupM CEO North America, the media management arm of WPP.
Clark referenced the recently launched Association of National Advertisers’ investigation into media practices in the U.S. and elsewhere, noting the firms hired to conduct it — K2 and Ebiquity/Firm Decisions.
Clark said the company intended to cooperate with the investigation, “but protecting the confidentiality of our client agreements is our primary responsibility. We also need to ensure that our own reputation for being compliant with client contracts and law is consistently managed.”
Therefore, Clark wrote: “If you are approached by anyone from K2 or Ebiquity/Firm Decisions (or anyone else enquiring about remuneration agreements or media buying practices) please refer them to the CEO, CFO, or the Corporate Communications Department of your company and they will manage the communication.
And for those in the company wondering about certain U.S. practices that the company might engage in, Clark posed six questions related to rebates, remuneration and buying practices:
1. Does GroupM
seek/accept rebates from media vendors in the US?
2. Does GroupM receive rebates elsewhere in the world as a result of spending in the US?
3. Does GroupM acquire discounted inventory for Xaxis in the US as a result of aggregated GroupM spend?
4. Does any client of GroupM in the US purchase Xaxis media products/inventory without a specific contract to that effect?
5. Are there any media transactions between GroupM in the US and companies in which WPP is a shareholder that are not disclosed?
6. Does GroupM in the US receive any ‘services’ revenue from media owners excluding those clients for which GroupM acts as media agency?
“The questions related to agency remuneration inevitably fall into one of these six areas and the answers to each of these for GroupM businesses in the US is an unequivocal NO,” Clark wrote.
The memo did not address practices outside of the U.S. where in many markets rebates are an accepted part of doing business.
The memo opened by reminding staff that it was time review and acknowledge the details of company’s Policy & Procedure Manual.Commenting on the missive, a GroupM rep said the specific comments about the ANA inquiry and related issues “were to reiterate our policies around requests for information…and to remind everyone of our position which we’ve communicated previously to the marketplace.”