Accenture shuts media auditing arm amid 'conflict' questions

Consulting giant wants to focus on agency operations.

Accenture shuts media auditing arm amid 'conflict' questions

Accenture is to shut its media auditing business in the wake of criticism that the consulting giant faced a conflict of interest as its separate digital marketing business, Accenture Interactive, has become a major global agency.

An Accenture spokesman said: "We can confirm that Accenture has decided to ramp down the area of its business that performs media auditing, benchmarking and agency pitch services by the end of August [when the company’s financial year ends].

"As part of the plan, we will work with clients to fulfil existing commitments and support their transitions."

Accenture’s media auditing arm, known as Accenture Media Management, is a small operation and is thought to have only a few dozen staff.

By contrast, Accenture Interactive has over $10bn of annual revenues and has been expanding rapidly, after buying agencies such as Droga5, and has been increasingly competing with the agencies that its sister business was auditing and benchmarking.

Industry rivals claimed that was a conflict of interest, particularly after Accenture moved into programmatic planning and buying in 2018.

Asked if avoiding a conflict was part of the rationale for the closure, a spokesman said: "We continually adapt and transform our business to create value for our clients. This decision is part of a broader initiative to position Accenture in the most strategic, high-growth areas of the market."

The company did not comment on how many staff work in Accenture Media Management but said it was discussing how to "redeploy them to other roles across Accenture".

Sam Tomlinson, a partner with responsibility for marketing and media assurance at PwC, which competes with Accenture Media Management, said: "I’m sure Accenture have kept their media auditing well segregated from Accenture Interactive but agencies have been vocally sceptical, so its exit is not a surprise.

"In any case, media auditing is fundamentally changing. In today’s media world, clients are increasingly looking for a new approach and a different standard of assurance professionalism, risk management and governance."

David Indo, chief executive and co-founder of ID Comms, which also competes with Accenture Media Management, said: "We’ve been waiting for this to happen for a while.

"When they began to accelerate their investment in Accenture Interactive and move into programmatic buying, then it became a real conflict of interest and it became untenable [to continue doing media auditing and benchmarking and run agency pitches]."

Indo said the potential to manage many billions of dollars of programmatic media planning and buying far outweighed the value of media auditing which was "a rounding error" by comparison for Accenture.

He claimed that some of the methodologies used by the well-established media auditing firms, including Accenture Media Management, look out-dated.

He pointed, in particular, at "pool-based" auditing, which worked in the days when broadcast TV dominated and pricing was easier to calculate but is now less relevant as media-buying has become biddable and auction-based.

Indo suggested Accenture may be relieved to exit the media auditing business as it can focus on its agency operations as it competes with WPP, Omnicom, Publicis Groupe and other big holding companies. 

"This is Accenture Interactive making a statement to the market: ‘We’re ready. There’ll be no more concerns about inviting us onto pitches, there’ll be no conflict of interest, we’re going to go after your business on your territory,’" Indo said.

He added that the only "surprise’" was that Accenture was not selling its media auditing business.

Accenture Media Management’s biggest competitor is Ebiquity, which has seen its share price slump in recent years as clients’ needs have been changing rapidly.